Ask Larry: Will My Wife’s Social Security Spousal Benefits Be Deemed When I File?

Social Security may be one of your largest assets. What and when you collect will make a huge difference to your lifetime benefits.

Today’s column addresses deeming under the Bipartisan Budget Act of 2015, marriage requirements for divorced spousal benefits, when survivor’s benefits might be claimed, filing after stopping work and the availability of spousal benefits. 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 My Wife’s Social Security Spousal Benefits Be Deemed When I File?​​

Hi Larry, I’m filing for my Social Security retirement benefit at my full retirement age (FRA) of66 later this year. My wife began her Social Security retirement benefit at age last year. Can she wait until she is 66 to file for her spousal benefit or does she have to start drawing her spousal benefit at a reduced percentage immediately when I file? Thanks, Doug

Hi Doug, Since your wife was born after 1/1/1954 and since she’s already filed for her own benefits, she’ll be deemed to file for spousal benefits when you file for your retirement benefits. Her reduced retirement rate would continue to apply even if she qualifies for additional spousal benefits on your record, and if her spousal benefits start prior to her full retirement age those benefits will be reduced as well.

For example, say Louise files for her retirement benefits at 62. Her Primary Insurance Amount (PIA), which is equal to her full retirement age (FRA) retirement benefit amount, is $500, but she receives a reduced rate of $370 for starting early. A year later, Louise’s husband files for his retirement benefits and he has a PIA of $2,000. Louise’s unreduced spousal rate would be calculated by subtracting her PIA from 50% of her husband’s PIA, which in this case would be $500 (i.e. $2,000 / 2 – $500). However, since Louise is forced to file for her spousal benefits as soon as her husband files for his benefits, Louise’s spousal rate is reduced to $370. This spousal benefit would then be added to Louise’s reduced retirement benefit to give her a combined benefit amount of $740 (i.e. $370 + $370). An expert Social Security benefits calculator as described in other answers can help you compare your filing options in order to determine which strategy is best for you and your wife. Best, Larry

Can I Collect On My Ex-Spouse’s Social Security Record?​​

Hi Larry, I will be 65 in August. I was married from 9/1979 until 7/1989. Can I collect a divorced spousal benefit, at least until 66? If I take a lower paying job, could it increase my benefit? What time period do I have to apply? Someone told me three months before your birthday? What about Medicare? Thanks, Todd

Hi Todd, Assuming that your marriage and divorce dates are accurate, you wouldn’t be able to file on your ex’s record. You must be married for at least 10 full years in order to qualify for divorced spousal benefits. You may want to double check the date that your divorce became final, though, since in some states there is or was a delay between the date of a divorce decree and that it became legally final.

Your retirement benefit rate is based on your highest 35 years of wage-indexed earnings. You can’t lower your benefit rate by working a lower paying job, but you might not increase it. Regardless of that, though, if you wait until age 70 to start drawing your retirement benefits your benefit rate will be 32% higher than if you start drawing at your full retirement age. Before filing, you may want to use an expert Social Security benefits calculator, such as my company’s software or other careful and precise software, to compare your options and determine your best strategy.

You can file up to 4 months in advance of the month you want to claim benefits, or at least as late as the month that you want to claim benefits. And if you file after your full retirement age you can claim benefits for up to 6 months prior to your month of filing. You can file for Part A of Medicare anytime from 4 months before to 6 months after the month that you want Part A coverage to begin. Enrolling for Part B coverage is more complicated and depends on a number of factors but if you want Part B coverage to begin with the month that you turn 65 you should file 1 to 3 months before then. Best, Larry

Can I Draw My Deceased Husband’s Social Security At Age 60?​​

Hi Larry, My husband passed away 7 years ago. I am age 58. We were married 7 years and I have never remarried. Can I draw a widow’s benefit based on his work record when I turn 60? Thanks, Jane

Hi Jane, I’m sorry for your loss. It sounds like you could potentially qualify for reduced widow’s benefits at age 60, which would be paid at a rate of 71.5% of your husband’s Primary Insurance Amount (PIA), which is equal to his full retirement age (FRA) retirement benefit amount. However, if you continue working your benefits could be subject to full or partial withholding until you reach your full retirement age (FRA) depending on the amount that you earn.

Assuming that you will also qualify for retirement benefits on your own record, your best strategy is likely one of the following:

1. File for reduced widow’s benefits at age 60 or as soon as your earnings will permit at least some benefits to be paid, then switch to your own record at age 70; or,
2. File for reduced retirement benefits on your own record at age 62 or as soon as your earnings will permit at least some benefits to be paid, then file for unreduced widow’s benefits at your full retirement age. However, if your husband received reduced retirement benefits prior to his death that could affect the optimal time for you to claim widow’s benefits.

Normally, you would want to start out drawing the lower benefit first and then switch to the higher record when it reaches its highest potential rate. Best, Larry

Can I Retire Before My Full Retirement Age And Wait Until Age 70 To Draw My Social Security Benefits?​​

Hi Larry, If I should retire before I reach my full retirement age (FRA) of 66 years and 5 months, can I leave my retirement benefit alone until age 70 but start to draw from my taxable 401K? I would leave my Roth 401K alone. If I can do this, would my Social Security retirement benefit grow by 8% per year until 70? Thanks, Celia

Hi Celia, Yes, and yes. Regardless of when you retire you can wait until age 70 to claim your Social Security retirement benefits, which would then increase by 8% per year from your full retirement age until you start drawing benefits at age 70. You may want to consider using an expert Social Security benefits calculator, such as Maximize My Social Security or other top rated software, to compare all of your options and verify your optimal filing strategy. Best, Larry

Is My Husband Eligible To Collect Half Of My Benefit Amount?

Hi Larry, We thought that full retirement age for both my husband any me was 67 and we both started collecting our Social Security retirement benefits last year at that age. My husband’s amount is less than half of what I receive (I collect $2,000 and he collects $800). Is he eligible to collect a spousal benefit? If so, when would that start if we went to to make the change? Would he have to stop collecting now and wait until age 70 for the higher rate? Thanks, Susan

Hi Susan, If you and your husband were born in any year from 1943 through 1954, then your full retirement age (FRA) for Social Security benefits is 66, not 67. So, if you both filed last year at age 67 you would be receiving more than your Primary Insurance Amount (PIA), which is equal to your full retirement age (FRA) retirement benefit amount.

Unless your husband receives a non-covered government pension, it sounds like he would probably be eligible for the higher of his own retirement benefit rate or 50% of your PIA. And, if 50% of your PIA is higher than his own benefit rate, he would almost certainly want to claim spousal benefits as soon as possible. If he’s currently age 67 or older, your husband could potentially claim spousal benefits for up to 6 months prior to the month he applies for them, but no earlier than the month that you became entitled to your benefits. Best, Larry

To learn more about your Social Security options, visit Economic Security Planning, Inc.