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File and Suspend versus File and Restrict
Old 10-15-2014, 08:48 PM   #1
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File and Suspend versus File and Restrict

Here's one man's view of File and Suspend versus File and Restrict. I don't recall reading about File and Restrict before, but maybe I missed it.

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But many people who are approaching their retirement years don't want to employ either of those "file and suspend" strategies. Instead, they want to claim benefits from a spouse at age 66, and then later, at age 70, switch to their own retirement benefits to get the 32 percent bonus. These folks want to employ the "file and restrict" policy. To explain this strategy, I must first give a little background.
The law says that an application for one kind of reduced Social Security benefit is automatically an application for every other Social Security benefit you might be due. That is why you generally can NOT file for reduced spousal benefits (at age 62, for example) and later switch to full benefits on your own record.
But the law also says that once you reach age 66, that "unrestricted application" rule goes out the window. What that means is that at age 66 you can file for Social Security and "restrict" your application to spousal benefits only. Then at 70, you can file for your own retirement benefits and get the 32 percent bonus.
Once again, please understand this is NOT a file and suspend scenario. You are not filing and suspending anything. You are filing for Social Security benefits, and then restricting the scope of that application to spousal benefits only.
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Old 10-15-2014, 11:46 PM   #2
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I believe file and suspend and file and restrict are just the two supporting roles of a couple who want one to be able to get get some early money from the spousal benefit. The first person files and suspends in order to make the second person eligible for a spousal benefit. Then the second person does a file and restrict to tap that spousal cash without diminishing his-her later benefit at 70.

Ha
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Old 10-16-2014, 04:38 AM   #3
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a married couple can not do both though . only 1 spusal benefit is allowed per married couple.

a divorced couple can claim sposal on each other.
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Old 10-16-2014, 05:08 PM   #4
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Sounds like file and suspend is one spouse and file and restrict is the other. Same strategy for a couple.

In my case it's just file. I'll be 70 before DW hits FRA. I'll take SS at 70 without any suspension, unless I decide to file earlier and suspend in order to have the option to claim past benefits for some reason. DW will do the file and restrict thing, taking the spousal benefit before taking her own age 70 benefit.

It seems like we've been using term file and suspend a little loosely for the strategy of claiming spousal benefits prior to claiming full benefits. I don't see file and restrict is anything new or different.
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Old 10-17-2014, 05:51 PM   #5
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the two are very different and so are the amounts so you need to run it both ways.

file and suspend has the higher earner not collecting a thing yet and their spouse collecting 1/2 theirs while they let their own grow.

file and restrict has the higher earner taking 1/2 the lower spouses benefit and both are collecting while the higher earner lets theirs grow...

file and suspend only has one check coming in while waiting,

file and restrict has two checks coming in while waiting. my wife collects her origonal early amount and i get 1/2 her full amount.

file and suspend has my wife collecting her early amount plus getting the difference between 1/2 mine but i get nothing yet..
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Old 10-17-2014, 06:07 PM   #6
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Not according to the article. He's saying there's no suspension in File and Restrict, that you are filing and restricting your benefit to spousal only (one check). But as I understand it, in order to allow your benefit to grow to age 70, you have to file and suspend, then your spouse can file for spousal benefits. Still one check. The only way I can see to get two checks is for one person to file and collect, while the second claims spousal benefits.

Obviously I could be missing something here, but I don't really see the difference.

Edit: I just read the article again, and it still looks like semantics. The higher earning spouse files then suspends. The lower earning spouse files, restricting themselves to spousal only. One check, and unsuspend at 70.
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Old 10-17-2014, 07:11 PM   #7
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Originally Posted by mathjak107 View Post
the two are very different and so are the amounts so you need to run it both ways.

file and suspend has the higher earner not collecting a thing yet and their spouse collecting 1/2 theirs while they let their own grow.

file and restrict has the higher earner taking 1/2 the lower spouses benefit and both are collecting while the higher earner lets theirs grow...

file and suspend only has one check coming in while waiting,

file and restrict has two checks coming in while waiting. my wife collects her origonal early amount and i get 1/2 her full amount.

file and suspend has my wife collecting her early amount plus getting the difference between 1/2 mine but i get nothing yet..
Your version of file and suspend sounds like something I considered. One spouse takes early benefits at 62, the other can take spousal at FRA and delay until age 70 to claim their own benefit. Two checks.

It's still all the same thing. One spouse has to be receiving benefits or must have filed and suspended benefits. The other spouse can then claim spousal benefits at their own FRA and full benefits at age 70. "File and suspend" if a suspension of benefits is used, "file and restrict" for the spouse receiving the spousal benefits, and maybe more accurate if no one actually suspends benefits.
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Old 10-17-2014, 07:22 PM   #8
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Originally Posted by harley View Post
Not according to the article. He's saying there's no suspension in File and Restrict, that you are filing and restricting your benefit to spousal only (one check). But as I understand it, in order to allow your benefit to grow to age 70, you have to file and suspend, then your spouse can file for spousal benefits. Still one check. The only way I can see to get two checks is for one person to file and collect, while the second claims spousal benefits.

Obviously I could be missing something here, but I don't really see the difference.

Edit: I just read the article again, and it still looks like semantics. The higher earning spouse files then suspends. The lower earning spouse files, restricting themselves to spousal only. One check, and unsuspend at 70.

there is no suspend when you use file and restrict.
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Old 10-17-2014, 07:26 PM   #9
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Originally Posted by harley View Post
Not according to the article. He's saying there's no suspension in File and Restrict, that you are filing and restricting your benefit to spousal only (one check). But as I understand it, in order to allow your benefit to grow to age 70, you have to file and suspend, then your spouse can file for spousal benefits. Still one check. The only way I can see to get two checks is for one person to file and collect, while the second claims spousal benefits.

Obviously I could be missing something here, but I don't really see the difference.

Edit: I just read the article again, and it still looks like semantics. The higher earning spouse files then suspends. The lower earning spouse files, restricting themselves to spousal only. One check, and unsuspend at 70.


you don't have to suspend with file and restrict since you do not ever have to elect to take your own before you want it after fra.

so as an example my wife filed at 62. at my fra i have a choice of leaving mine alone or taking 1/2 her fra. no suspend is needed since in this case i am not required to file for mine yet at all and she has no suspend option ..

i get a check based on her 1/2 and she continues to get her own. two checks -no suspension needed.

the other option is different , she collects at 62 ,at fra i file and suspend. i get no check at this point but she gets her origonal amount with the difference added between her full and 1/2 my full to her check. we get one check but a bigger check with file and suspend.

the amounts you recieve will be different. for some file and restrict will be more ,for others file and suspend.
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Old 10-17-2014, 08:08 PM   #10
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Interesting. I didn't understand how that could work. Especially I didn't know you could claim, then add the spousal benefit to your check. Thanks for the explanation.
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Old 10-18-2014, 03:08 AM   #11
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if a spouse files early ,they never give up their own benefit.. that reduiced benefit stays with them forever.]

so when you do a file and suspend if 1/2 your full is more they just subtract 1/2 your full from their full and the difference gets added to their reduced benefit .

so lets look at an example.

my wife filed at 62 and gets 700 a month, her full would have been 1k a month if she waited to fra.. so at my fra i do i file and suspend.

my full is 2500 a month so 1/2 my full is 1250.00.

they take 1/2 my full which is 1250 and subtract her full which is 1000 and the difference is 250.00. that 250 gets added to her check and i get no check and let it grow. she now gets 950.00 intead of 700.



if we did a file and restrict
: she filed at 62 and gets her 700. at my fra i file for 1/2 her full and get 500.00. we get two checks totaling 1200.00 ,leaving my own to grow.

in this case we do better doing a file and restrict.
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Old 10-18-2014, 08:10 AM   #12
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In another thread there was some discussion about what month of the year you want to file. Seems like one can screw up big time if all this is not done properly. Guess one of the third party software solutions is needed to determine one's optimal payout. I hit FRA next June, and DW will not be eligible for early benefits until July 2016. I get max SS and DWs is about 50% less.

I have a little more time to figure this out, unless the laws change.
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Old 10-18-2014, 08:19 AM   #13
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they do not give you delayed credits uyntil the following january and only pay going forward.

you would not see delayed credits in your money from feb to dec as an example if you filed in those months for the current year and lose it.

best thing to do is file early january . you will get all credit for delaying.
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