Dear Rusty: I am 69 and have been holding off on collecting my Social Security payment until I’m 70 on the assumption that my wife would collect my benefit if I died first. My thought was that she would collect the monthly benefit I will earn at age 70 in the event of my death. Now a Social Security employee is telling me she would only be entitled to what my benefit would have been at age 66 (my full retirement age). That is about an $800 drop in monthly benefits from what I thought it would be. My wife is a year younger than me, much healthier than I am, has mostly worked part-time and she started collecting her SS at age 62 and gets about $700 a month. So, is the Social Security employee correct? Signed: Concerned Husband
Dear Concerned: The Social Security employee you spoke with might have misunderstood your question. It sounds like the answer you were given pertained to the benefit your wife is entitled to as your spouse while you are living, which is based upon your “primary insurance amount,” or “PIA” (your PIA is the amount you were due at your full retirement age, or “FRA”).
When you claim your increased benefit at age 70 your wife can apply for her spousal benefit, which will be based on your FRA benefit amount (not the increased amount you’ll get by waiting until age 70 to claim). She gets that spousal benefit if it is more than she is receiving on her own work record, which from what you’ve told me it will be. What actually happens is that she will continue to get her own benefit and she will also get a supplemental amount to make her total Social Security benefit equal to what she is entitled to as your spouse. That amount will be a bit less than half of your FRA benefit because she took her own benefit at age 62 (claiming Social Security early doesn’t only affect one’s own benefit, it affects their spousal benefit also). The spousal benefit your wife gets when you claim at age 70 will continue for as long as you are living.
But the Social Security benefit rules are different for your wife as your widow and your survivor. If you predecease your wife, her spousal benefit from your work record, as described above, will discontinue and she will be switched to her survivor’s benefit. That survivor’s benefit will be 100 percent of the benefit amount you were receiving at your death, instead of the lower amount she was receiving as your spouse when you were living. So, your original assumption is correct – as your widow your wife will get 100 percent of the increased benefit you were receiving when you pass. The Social Security employee was incorrect by telling you that, if you pass, your wife will only get what you were due at your full retirement age; instead she’ll get the full amount of your current Social Security benefit (your full age 70 benefit, plus any COLA adjustments made after your claim).
Russell Gloor is an Association of Mature American Citizens certified social security advisor. To submit a question, visit amacfoundation.org/programs/social-security-advisory or email firstname.lastname@example.org.