Misconceptions About Delaying Social Security

[Animorph]

Doesn't matter if that higher earner waits till his/her FRA for spousal benefit. Gets 1/2 the spouse's FRA benefit regardless between their FRA & age 70 or whenever after FRA the higher earner starts taking their own increased SS benefit.

"Even if he or she has never worked under Social Security, your spouse may be able to get benefits if he or she is at least 62 years of age and you are receiving or eligible for retirement or disability benefits."

Retirement Planner: Benefits For Your Spouse

To get spousal benefits, the other spouse must be receiving benefits or have applied and suspended. This makes it more difficult if the younger spouse is the bigger earner.

 

[RobLJ]

Haven't read all the posts.
But one consideration I'm pondering is that the timing could be dependent on retirement and portfolio timing. That is, as long as the investment environment/portfolio is doing well, continue to delay SS.
If the market crashes, take it earlier and defer drawing from the portfolio, particularly the stock piece. Seeing it as an income option (or option on stock/portfolio value) increases under the scenario that both stocks and bonds allocations go down at the same time.
Just a thought but I suspect someone made it already.
Also, as retiredunder50, it would allow further consumption earlier on the assumption spending will decrease later as one slows down.

 

[heirloom]

Just remember, per SS newsletter in May/2013 SS funds will be depleted.

"The combined assets of the Old-Age and Survivors Insurance, and Disability Insurance (OASDI) Trust Funds are projected to become depleted in 2033, unchanged from last year, with 77 percent of benefits still payable at that time."

We'll still get some, but it will decrease.

I feel it will get worse because there are so many unemployed that can't contribute to SS and the wages of middle class employees aren't increasing with inflation. They just mentioned this week that the top 1% are getting richer while the lower class are getting more poor. This doesn't help SS at all.

 

[heirloom]

I stand to be corrected....2033, not 2013.

 

[gerntz]

"Even if he or she has never worked under Social Security, your spouse may be able to get benefits if he or she is at least 62 years of age and you are receiving or eligible for retirement or disability benefits."

Retirement Planner: Benefits For Your Spouse

To get spousal benefits, the other spouse must be receiving benefits or have applied and suspended. This makes it more difficult if the younger spouse is the bigger earner.

I'm not following why this makes it tougher. I would think the older, lower income spouse is most likely to taking SS benefits first. Yes/No? So when the younger high earner reaches their FRA, he/she just applies for spousal benefit of older spouse already on SS.

Don't know what the spouse who never worked has to do with this. I think that spouse can only collect spousal benefits, not benefits on their own.

 

[Animorph]

I'm not following why this makes it tougher. I would think the older, lower income spouse is most likely to taking SS benefits first. Yes/No? So when the younger high earner reaches their FRA, he/she just applies for spousal benefit of older spouse already on SS.

Don't know what the spouse who never worked has to do with this. I think that spouse can only collect spousal benefits, not benefits on their own.

Yeah, file and suspend mechanically works the same, but you only get 1/2 the lower earning spouse's full benefit. Not as good as the other way around. The key part of the quote was: "you are receiving or eligible for retirement or disability benefits." That hinders the older spouse from receiving additional spousal benefits (from the higher earner) before receiving their own benefit (if higher) at age 70. That's my poorly worded "difficulty". Without that requirement it would have been possible for the older low earning spouse to file at FRA for half the higher earning spouse's full benefit, just like the case when the high earner is the same age or older.

 

[braumeister]

Doesn't the high earner in this case have to be at FRA before the spouse can get spousal benefits?

 

[Animorph]

Doesn't the high earner in this case have to be at FRA before the spouse can get spousal benefits?

No, but...

Spousal benefits are available as long as the other spouse is already taking benefits. That could be age 62 to FRA. But the other spouse is then stuck with that lower-than-FRA benefit forever. Not a problem for many, as we all know. The other spouse can only file and suspend if they are at FRA or above.

 

[retiredunder50]

how much faith do you have in actuarial tables

I wonder how this current & next generation of our population will impact the actuarial tables. Yes, there are medical advances, but compared to the previous generation, how much will our obese, sedentary lifestyles, with sleep deprivation, screen-watching, minimal physical activity, and exposure to more chemical toxins in our foods and environment affect the tables? Doesn't anybody think we might be experiencing a real downward trend in life expectancy?