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Today’s column addresses whether marrying will cause Social Security benefits to end, how much income is exempt under the earnings test if you reach FRA this year, potential effects of suspending, which month to start benefits and potential effects of a teacher’s pension. Larry Kotlikoff is the founder and president of Economic Security Planning, a company that markets Maximize My Social Security, a Social Security benefits calculator referred to in this post.
See more Ask Larry answers here.
Ask Larry about Social Security:
Will I Lose My Social Security Benefits If I Get Married?
Hi Larry, I’m 66 and going to get married in September this year. Will I loss my Social Security benefits that I’m currently receiving? My husband to be will be 73 in October and is already receiving his Social Security retirement benefit and has been for just under five years. His benefit is higher than mine as I mostly worked in the home at first and then as an assistant in my ex’s office without a salary. Thanks, Christie
Hi Christie, If you’re receiving Social Security retirement benefits based on your own work record, then marrying won’t cause you to lose your retirement benefit. Nor would getting married have any effect on widow’s benefits on the record of a former spouse.
Furthermore, after you’re married it’s possible that you might become eligible for spousal benefits on your new husband’s record, but only if 50% of his Primary Insurance Amount (PIA), which is equal to his full retirement age (FRA) retirement benefit amount, is more than your PIA. In most cases, though, you must be married for at least a year before you can qualify for spousal benefits.
You mention your ex and about the only way that your marriage could result in losing your Social Security benefits is if you’re receiving divorced spousal benefits on a living ex-spouse’s record, or if you’re receiving disabled adult child’s benefits on the record of a parent. Once you do get married, you may want to inquire with Social Security to see if you could qualify for spousal benefits on your husband’s record, or vice versa. Best, Larry
How Much Can I Earn Up This Year Without Being Penalized?
Hi Larry, I turn 66 on the last day of December and I was told that I can receive my Social Security retirement benefits because I will be 66 in the year of 2019. I do plan to continue to work and was told as long as I made under a certain amount, I would not be penalized. Is this true? Thanks, Jason
Hi Jason, Yes, as long as you earn less than the earnings test exempt amount in 2019, you could potentially draw benefits in 2019 and not lose any of them due to the earnings test. And even though you won’t reach your full retirement age (FRA) of 66 until the last day of 2019, the applicable exempt amount for you would be the higher amount set for people who reach FRA during the year. The higher exempt amount for people reaching FRA in 2019 is $46,920.
However, the downside of starting your benefits before your FRA is that you will then receive a reduced benefit rate. Furthermore, depending on your marital history you may have other and better filing options available to you. You can use an expert Social Security benefits calculator as described in other answers to explore and compare your filing options before you make a decision on when to apply for benefits. Best, Larry
How Will Our Benefits Be Affected If I Voluntarily Suspend My Benefits?
Hi Larry, My question concerns voluntary suspension of benefits. I started taking my Social Security retirement benefit at 62 and am now 66. If I were to request a voluntary suspension of my benefit, would the amount of my benefit increase during the time it’s suspended until I resume taking it at age 70? If so, how much? Also, my wife has been receiving an excess spousal benefit in addition to her retirement benefit since I filed at age 62 . How will she be affected if I decide to suspend my benefit? Thanks, Ernesto
Hi Ernesto, Your benefit rate would go up if you voluntarily suspend your benefits, and the increase would amount to 2/3rds of 1% for each month (8% per year) that you aren’t paid benefits between your full retirement age of 66 and age 70.
The plus side of suspending your benefits, as noted above, would be that your benefit amount would be higher after your benefits are reinstated. Furthermore, the higher rate that you would then receive could be passed on to your wife as a widow should you die before her.
The downside is that you would not be paid any benefits during the suspension period, nor could your wife be paid spousal benefits while your benefits are suspended. So your wife would only be paid her own retirement benefit rate during that time. And any increase in your benefit rate that results from suspending your benefits would not increase your wife’s spousal rate when your benefits are reinstated. You may want to consider using an expert Social Security benefits calculator, such as my company’s software or other very accurate and comprehensive software, to compare your options so that you can determine whether the positives of suspending your benefits would outweigh the negatives in your case. Best, Larry
Which Month Should I Choose To Start My Benefits?
Hi Larry, this July I will be 66 and so eligible for my full retirement benefit with no reductions for filing before my full retirement age. Should I request August as the starting month or is there a more advantageous one? I definitely want to retire this year but I don’t want to have my benefit permanently reduced for filing earlier than I intend. Thanks, Shandra
Hi Shandra, You would receive an unreduced benefit rate if you chose July and your first check would then be issued in August. But you may want to consider waiting past 66 to start drawing if it’s at all possible to do so. Your Social Security retirement benefit rate would increase by 2/3rds of 1% for each month, at a rate of 8% annually, that you delay drawing benefits from 66 until age 70. In other words, if you wait until age 70 to file, your retirement benefit rate will be 32% higher than your age 66 rate even if you stop working at age 66.
You don’t mention your marital status so I don’t whether or not you have additional options and considerations. You may want to use an expert Social Security benefits calculator, such as Maximize My Social Security or other very careful and precise software, to explore and compare your options so that you can choose the best course of action. Best, Larry
Will My Wife Be Ineligible For Spousal Or Widow’s Benefits Because She’s Receiving A TRS Pension?
Hi Larry, I am 61 and the higher wage earner. My current Social Security statement has me at 70 receiving a little over $3,000 a month but I intent to continue to work till 66 in my current high income job. I then intent to work part time and delay to 70 receiving my Social Security retirement benefits.
My Wife is 59 and has been retired from her 30 plus years of teaching since 2014. She has been receiving full TRS retirement pension since then and we opted for the lifetime payout. Is she eligible to receive either spousal or widow’s benefits based on my record? We have been told she is ineligible since she is receiving TRS benefits. Thanks, Roland
Hi Roland, Your wife wouldn’t necessarily be ineligible for spousal or widow’s benefits, but assuming that she didn’t pay Social Security taxes on her earnings as a teacher any spousal or widow’s benefits for which she qualifies would likely be subject to offset by 2/3rds of the amount of her TRS pension. As a result, if your wife’s TRS pension amount is at least 150% of her potential Social Security spousal or widow’s benefits, then her spousal/widow’s benefits would likely be reduced to zero. This is due to the Government Pension Offset (GPO) provision, by the way.
For the record, though, even if your wife wouldn’t be able to collect monthly Social Security benefits, she could still likely qualify for at least technical entitlement as a spouse or widow on your record. That would enable her to qualify for premium free Part A of Medicare when she reaches age 65. You and your wife may want to consider using an expert Social Security benefits calculator as described in other answers that is fully programmed to handle GPO considerations. Best, Larry
To learn more about your Social Security options, visit Economic Security Planning, Inc.