AMAC Certified Social Security Advisor Russell Gloor, Association of Older American Citizens
Dear Rusty: My wife started her Social Security in March 2017 at age 62 and I filed a limited application shortly after to collect a partner’s benefit from her. Our plan is that later this year, when I turn 70, I will apply for my own Social Security. Then my wife will apply for her partner’s benefit from me. Our life expectancy is 93 and 96. Is this still the best plan for maximum benefits? Signed: planning ahead
Best schedule: Yes indeed. You have chosen an excellent strategy that is no longer available to younger beneficiaries. The Limited Application option you chose to receive only partner benefits and increase your own income was eliminated for anyone born after January 1, 1954.
When you turn 70, you will be eligible for your maximum SS retirement benefit at that point. Social Security recommends that you submit an application about three months before you want the benefits to start (you indicate on the application when you want the benefits to start), so that you can submit this application before your birthday if you do. want, but make sure to explicitly state that your benefit start month is the month you turn 70. That way, you won’t lose any of the Deferred Retirement Credits (DRCs) you’ve accrued since you reached full retirement age (FRA) of 66. Your benefit at age 70 will be 32% more than at age 66.
Keep in mind that when you apply, Social Security will likely offer to pay you benefits for six months retroactively. While that lump sum can be quite tempting, accepting it will also reduce your Social Security benefit by 4% for the rest of your life. With a life expectancy in your 90s, I recommend choosing wisely.
After you have submitted your application for unemployment benefits, your current partner’s benefit will stop as soon as your higher benefit starts. After you have applied for your 70-year-old benefit, your wife’s partner’s benefit is automatically awarded when your own benefit starts (automatically because she was born after 1 January 1954). FYI, your wife’s partner benefit is based on your full retirement benefit, not the increased amount you will receive because you deferred until age 70. You should also be aware that your wife’s benefit as your husband will be less than 50% of your FRA benefit because she applied for her own benefit at age 62 (claiming her own benefit early will affect her partner’s pension).
Nevertheless, with a life expectancy in your 90s, you have chosen an excellent strategy that will pay you the highest possible monthly amount and most cumulative benefits throughout life, while also providing the highest possible survivorship benefit to your wife if you die first. . While waiting until age 70 isn’t the right decision for everyone, I congratulate you on making a very wise choice in your particular case.
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