Social Security Q&A: Should My Spouse File for Retirement Benefits at FRA or Wait and Claim Spousal Benefits at 70?Commentary by Laurence Kotlikoff
August 31, 2014
Social Security may be your largest or one of your largest assets. How you manage it, by deciding which benefits to collect and when, can make an absolutely huge difference to your lifetime benefits. And those with the highest past covered earnings have the most to gain from maximizing their Social Security.
I’ve been answering questions and writing columns about Social Security each week for the past two years on PBS NEWSHOUR’s website. The editors at Forbes asked me to post a Q&A each day from those columns. To see all my columns, please go to my software company’s site, www.maximizemysocialsecurity.com, and click More Press below the WSJ quote.
Today’s question asks if a lower earning spouse should claim retirement benefits at FRA or spousal benefits at 70. The answer brings up the possibility of first filing for spousal benefits at FRA and then claiming her own retirement benefits at 70.
Question: I am 69 and my wife is 62. I plan to start drawing Social Security at 70 and continue to work until 73, when my wife turns 66. She no longer works, so is it better for her to begin her benefits at 66 or wait until 70? At which point will her spousal benefits be higher? I have been the highest wage earner.
Answer: It may be best for your wife to apply just for a spousal benefit at 66. It will be a full spousal benefit equal to half of your full retirement benefit (not half the benefit you’ll get at 70, which includes delayed retirement credits). She would, under this strategy, apply for her own retirement benefit at 70. If her own retirement benefit at 70 is larger than half of your full retirement benefit (her full spousal benefit), her Social Security check will rise starting at 70 to reflect her benefit, not the one she gets as your spouse.