Spousal SS (an easy question)

[marko]

Ok folks, this should be a short thread. I just want to make sure I'm not missing anything.

Caveat: This is a simple question. Please: Let's not get into the benefits of taking SS at whatever age or let it drift into the solidity of the program; we don't need another poor dead horse getting beaten.

Here's my question:
I took SS at 62. DW is six years younger than I and will also be taking it at 62.
Key: Her benefit is almost exactly the same as mine; within $600 annually.

I think there is no benefit in her filing any special way (spousal benefit or anything like that) because her benefit is the same as mine. She should just file on her own, without any gymnastics right?

I never fully understood the spousal benefit process and the most recent change a few years ago, so any insight appreciated.

Yes, yes, yes, we fully understand the differences between waiting to FRA and 70...let's not go there. We just want to know if we're missing some filing process that could be beneficial; I don't think there is but...just asking.

 

[Carol1862]

Your spouse was born after 1953 so no spousal benefit for her as far as file and suspend. She’ll file on her own SS and they will adjust accordingly if she’s due more money on your account. You asked for a simple answer!! That’s as simple as it gets!!

 

[marko]

Your spouse was born after 1953 so no spousal benefit for her as far as file and suspend. She’ll file on her own SS and they will adjust accordingly if she’s due more money on your account. You asked for a simple answer!! That’s as simple as it gets!!

Simple! Thanks.
What do you mean "adjust accordingly if she's due more money"? What does my account have to do with her?

 

[pb4uski]

If her benefit at her FRA based on her own work record was less than half of your benefit based on your work record at your FRA then she would get a spousal benefit to bring her benefit to 50% of your benefit.... but since your benefits based on your own work record are so close it won't apply in your situation.

But it does in our case since I was the main breadwinner and DW was a SAHM and my PIA is 3.6x hers.

 

[marko]

If her benefit at her FRA based on her own work record was less than half of your benefit based on your work record at your FRA then she would get a spousal benefit to bring her benefit to 50% of your benefit.... but since your benefits based on your own work record are so close it won't apply in your situation.

But it does in our case since I was the main breadwinner and DW was a SAHM and my PIA is 3.6x hers.

Thanks. This is what I thought but was just double checking.

 

[mountainsoft]

Usually a spouse will receive the higher of their own SS benefits or 50% of your benefits. However, since you retired at 62 the spousal benefit will be reduced (down to 35% in some cases). There's a calculator on the SS site at https://www.ssa.gov/OACT/quickcalc/spouse.html#calculator

Run the numbers to see, but it sounds like your wife's own benefits will be more than the spousal benefits.

 

[tb001]

Usually a spouse will receive the higher of their own SS benefits or 50% of your benefits. However, since you retired at 62 the spousal benefit will be reduced (down to 35% in some cases). There's a calculator on the SS site at https://www.ssa.gov/OACT/quickcalc/spouse.html#calculator

Run the numbers to see, but it sounds like your wife's own benefits will be more than the spousal benefits.

Since the simple question has been answered, I'll ask a related one.

Is this dependent on the age the higher earning spouse starts to collect SS? e.g. The high earner collects at 62, so the spousal benefit is reduced, even if the spouse doesn't begin to collect until their FRA?

For some reason I thought the spousal benefit was based on FRA, regardless of when the higher earner began collecting.

 

[mountainsoft]

Is this dependent on the age the higher earning spouse starts to collect SS? e.g. The high earner collects at 62, so the spousal benefit is reduced, even if the spouse doesn't begin to collect until their FRA? For some reason I thought the spousal benefit was based on FRA, regardless of when the higher earner began collecting.

As I understand it, the benefit your spouse receives is based on YOUR FRA even if you retire early:

"The spousal benefit can be as much as half of the worker's "primary insurance amount," depending on the spouse's age at retirement. If the spouse begins receiving benefits before "normal (or full) retirement age," the spouse will receive a reduced benefit. However, if a spouse is caring for a qualifying child, the spousal benefit is not reduced."

If your spouse retires early the spousal benefit is reduced just like her own benefit would be reduced:

"A spouse can choose to retire as early as age 62, but doing so may result in a benefit as little as 32.5 percent of the worker's primary insurance amount."

 

[tb001]

As I understand it, the benefit your spouse receives is based on YOUR FRA even if you retire early:

"The spousal benefit can be as much as half of the worker's "primary insurance amount," depending on the spouse's age at retirement. If the spouse begins receiving benefits before "normal (or full) retirement age," the spouse will receive a reduced benefit. However, if a spouse is caring for a qualifying child, the spousal benefit is not reduced."

If your spouse retires early the spousal benefit is reduced just like her own benefit would be reduced:

"A spouse can choose to retire as early as age 62, but doing so may result in a benefit as little as 32.5 percent of the worker's primary insurance amount."

So I read that to mean that if the spouse waits until FRA, but the worker retires at 62, the spouse benefit is not reduced. It is still 50% of what the worker would have received at FRA.

 

[MissMolly]

In order to collect the full 50% of spousal PIA, you must be full retirement age. Even if your spouse began collecting his/her SS at 62, as long as YOU wait until YOUR full retirement age, you will receive 50% of what would have been your spouse's SS at THEIR full retirement age.

 

[MissMolly]

tb001 posted as I was typing my response, but they are the same.

 

[mountainsoft]

So I read that to mean that if the spouse waits until FRA, but the worker retires at 62, the spouse benefit is not reduced. It is still 50% of what the worker would have received at FRA.

Yep, that's how I understand it as well.

 

[tb001]

Yep, that's how I understand it as well.

Ah, ok, I think I misunderstood your original post. Was worried I needed to go back and recalculate!

 

[Want2rv]

My husband took social security benefits at age 62 in 2017. He was the higher wage earner. When I applied for my social security benefits at age 62 in 2018, I went to our local social security office to apply. My benefit was adjusted higher by the social security office to equal 50% of what my husband was currently receiving. It amounted to approximately $60 more a month than the payment I was entitled to receive based upon my record.
They worked through the different calculations for benefits while I was there to make sure I got the highest benefit. This was done without me having to ask. They were very helpful which was a pleasant surprise to me.

 

[Crabby Mike]

My husband took social security benefits at age 62 in 2017. He was the higher wage earner. When I applied for my social security benefits at age 62 in 2018, I went to our local social security office to apply. My benefit was adjusted higher by the social security office to equal 50% of what my husband was currently receiving. It amounted to approximately $60 more a month than the payment I was entitled to receive based upon my record.
They worked through the different calculations for benefits while I was there to make sure I got the highest benefit. This was done without me having to ask. They were very helpful which was a pleasant surprise to me.

I hope you're mistaken, and they actually gave you 50% of his FRA amount, not "what he was currently receiving." Because that's what all the comments above yours say, and what I believe is how it works.

 

[MissMolly]

I hope you're mistaken, and they actually gave you 50% of his FRA amount, not "what he was currently receiving." Because that's what all the comments above yours say, and what I believe is how it works.

No, the above say that if she had been full retirement age she would have gotten 50% of his PIA. But since she filed at 62 she gets a reduced amount.

 

[Crabby Mike]

No, the above say that if she had been full retirement age she would have gotten 50% of his PIA. But since she filed at 62 she gets a reduced amount.

Well, that's a good point. But then they would have calculated hers as 50% of his PIA, adjusted downward due to her early filing, I suppose that would coincidentally have been 1/2 of what he was getting as well, but that would not have been the way it was calculated.

 

[Chapter 3]

Thanks for the original simple question marko. I have a similar situation and always assumed the same as you. Sounds like the simple answer is, we were correct.

 

[marko]

Thanks for the original simple question marko. I have a similar situation and always assumed the same as you. Sounds like the simple answer is, we were correct.

Yes.

But for an 83 year old program that almost everyone gets to eventually use, it surprises me how confusing it can be, as evidenced by the follow-on questions here and the weekly new questions here on this forum.

Then again, maybe I shouldn't be surprised. Gov't programs tend to have automatic, needless and built-in complexity by definition.

 

[MissMolly]

Well, that's a good point. But then they would have calculated hers as 50% of his PIA, adjusted downward due to her early filing, I suppose that would coincidentally have been 1/2 of what he was getting as well, but that would not have been the way it was calculated.

Actually, I think it works out. For example, if his PIA was $1,000 and he takes at 62 he gets 30% haircut - so he gets only $700. If she files spousal at 62 and you start with 50% of his PIA ($500) and then she gets a 30% reduction for taking early, she gets $350 which is exactly 1/2 of what he is currently drawing. Am I thinking right?

 

[travelover]

Yes.

But for an 83 year old program that almost everyone gets to eventually use, it surprises me how confusing it can be, as evidenced by the follow-on questions here and the weekly new questions here on this forum.

Then again, maybe I shouldn't be surprised. Gov't programs tend to have automatic, needless and built-in complexity by definition.

I’ve been pretty impressed by both SS and Medicare as far as clarity and effort to make it understandable to fuzzy headed old people. It seems like they bend over backward to make it fair and give people the benefit of the doubt. Some of the rules are ridiculously generous, the whole spousal benefit being one.

 

[Myssdragn]

My situation is somewhat similar except the roles are reversed. I retired and collected SS at 62. My wife is 5 years older and retired at the same time. For simplicity my PIA is $2000. Since I filed early my benefit is reduced to $1500. My wife is collecting spousal benefits because she was grandfathered under the old rules and can collect on my PIA 50% of my full retirement benefit or $1000. She will collect this amount until she reaches age 70. Then she will collect her PIA plus the increased benefit of waiting until 70 to collect which is approximately 30 greater than she would of collected at age 66 (FRA). Her benefit will be about $2000 at that time even though her income was about 60% of mine during our careers. We were able to retire earlier and have greater income during our early years of retirement. The biggest advantage to us was lower income for my ACA subsidies and not having to tap our nest egg earlier.

 

[Want2rv]

We are traveling with our rv so I don’t have the social security paperwork with me to explain what the calculations were for my monthly amount. I know there were reductions based upon us taking social security benefits early.
I didn’t mean to cause confusion, I just wanted Marko to know that I got more than I expected due to the adjustment that was made because of my marriage.
I hope this explanation helps others.

 

[Octogirl]

So for those of us born after 1953, there is an incentive to wait until FRA to claim SS whether DH or I are the higher earner. Our incomes are similar. We have not claimed SS yet.

Is this correct ?

 

[pb4uski]

So I read that to mean that if the spouse waits until FRA, but the worker retires at 62, the spouse benefit is not reduced. It is still 50% of what the worker would have received at FRA.

That is my understanding.