Social Security

When to Take Social Security: A Breakdown by Marital Status

Find the best benefit claiming strategies for singles, married couples and divorcees.
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Social Security Secret:

How to Add Thousands to Retired Couples Incomes

Research shows how clients can gain tens of thousands of dollars in extra retirement income by applying little known Social Security Administration rules.

In the first of two scenarios, a husband and wife both have similar earnings but the higher earning husband plans to delay receiving Social Security benefits until he is 70 (thus accruing credit that will boost his monthly income). The wife meanwhile will start taking her Social Security benefits at age 62 (thus receiving less than the full benefit that kicks in at age 66).

Most retirees likely assume the husband in this scenario is prudently delaying his retirement to maximize their retirement income without appreciating that the husband is entitled to claim spousal benefits while continuing to accrue deferral credits.

By filing a “restricted application,” the husband will receive 50% of his wife’s Social Security income for each month he delays claiming his own benefit (but only after his wife turns 66). (This illustration assumes husband and wife are both 66, so there are four years during which he can earn spousal benefits while earning deferral credits of his own).

That’s $42,000 in found money. (Of course, these numbers could vary a great deal based on how much Social Security credit a person has accumulated.)

That particular strategy works well when the early-retiring spouse is entitled to a reasonably high income.

Another technique when the retiring spouse is entitled to a low monthly income of, say, $100. In this second scenario–assuming the husband, again, is a high earner delaying retirement till 70 and the wife has reached her full retirement age of 66–the husband should “file and suspend.” That is, he should file for his higher level of benefits but suspend his receipt of the benefits.

This entitles his low-earning wife to claim spousal benefits. If he would be earning $2,000 a month and she $100 a month, she can now claim half his benefits ($1,000) minus her benefit ($100) for a $900 monthly benefit. Under this scenario, the husband continues to earn deferral credits till age 70 while the wife collects an additional $43,200 in additional benefits.

Be aware Social Security Administration is more restrictive these days about allowing filing changes so it is imperative that retiring clients think through their strategy before submitting their benefit claims.

To compute the effect of early or delayed retirement for the retiree, access the following Web page:                                                                                                                                                                                  

To compute the effect of retirement choice on spousal benefits access


American Portfolios Advisors, Inc. an SEC Registered Investment Advisor.