Couples who are currently married, or who have stayed together at least 10 years, tie their working records — and the resulting Social Security checks — together as long as they both live. In the case of Social Security payments, the result is often better for the couple. Spouses have Social Security claiming options that single people don’t.
Here are a few ways couples can boost their Social Security benefits:
Utilize Spousal Payments
Spouses are entitled to a Social Security payout of up to 50 percent of the higher earner’s check if that amount is higher than benefits based on his or her own working record. Retired couples in which one spouse did not work or had low earnings have the most to gain from this provision. However, low-earning spouses must wait until what the Social Security Administration calls the “full retirement age” to collect the full 50 percent. (For baby boomers born between 1943 and 1954, the full retirement age is 66.)
Benefits are reduced for spouses who collect before their full retirement age. For example, a low-earning spouse whose full retirement age is 66 would only be eligible for 35 percent of the higher earner’s benefit at age 62. The spousal benefit does not increase above 50 percent of the higher earner’s benefit if claiming is delayed beyond the full retirement age.
Claim and Suspend
The lower earner cannot receive spouse’s benefits until the higher earner files for retirement benefits. Workers who have reached their full retirement age may apply for retirement benefits and then request to have the payment suspended. Claiming and suspending payments allows the lower earner to claim a spousal benefit and the higher earner to continue working and earn delayed retirement credits until age 70.
“This would tend to maximize their lifetime benefits and more importantly maximizes the survivor’s benefit,” says Andrew Biggs, a resident scholar at the American Enterprise Institute and a former deputy commissioner of the Social Security Administration.
“You will ensure you will have a higher benefit when you need one, which is when you are a widow later in life.” Social Security checks increase by 7 to 8 percent for each year of delayed claiming between your full retirement age and age 70. After age 70 there is no additional benefit for waiting to collect your due.
Duel-earner couples who have reached their full retirement age can claim Social Security twice: first as a spouse and later using their own work record. A person may choose to sign up for only a spouse’s benefits at their full retirement age and continue accruing delayed retirement credits on their own Social Security record.
The worker may then file for benefits based on their own work at a later date and receive a higher monthly benefit due to delayed retirement credits. For example, a man planning to retire at age 70 could claim a spouse’s benefit based on his wife’s earnings at age 66 and then claim again based on his own working record when he exits the workforce at age 70. High-income couples with relatively equal earnings gain the most using this strategy, according to calculations by the Center for Retirement Research at Boston College.
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Social Security recipients who have children under age 16 or who are disabled can secure additional Social Security payments for the child and a spouse caring for the child, even if the spouse is under age 62. Each child is eligible for up to 50 percent of the retiree’s full benefit.
However, payments to family members are capped, typically at 150 to 180 percent of the retiree’s benefit payment. If the total benefits due to the retiree’s spouse and children are above this limit, their benefits will be reduced. The retiree’s payout, however, will not be affected.
Ex-Spouses are Eligible
A former spouse may be eligible for benefits if the marriage lasted at least 10 years. The divorced spouse must be age 62 or older and unmarried. The amount of benefits an ex-spouse claims has no effect on the benefits the worker and her or her current spouse can receive.
Boost the Survivor’s Benefit
Widows and widowers are entitled to the higher earner’s full retirement benefit. Surviving spouses can begin receiving Social Security benefits at age 60, or age 50 if they are disabled. Benefits are reduced by up to 28.5 percent if claimed before the recipient’s full retirement age. The surviving member of a dual earner couple can also claim a reduced benefit on one working record and then switch to the other.
For example, a woman could take a reduced widow’s benefit at age 60 and then claim 100 percent of the retirement benefits based on her own working record when she reaches her full retirement age. Most survivor benefits are paid to women because wives are generally younger than their husbands and live longer.
A husband can increase the monthly survivor’s benefit his wife will receive by 60 percent by waiting to sign up for Social Security until age 70.