Yet another SS question

[tessaduncan]

Yes, it's about 'when' <ducking>. Before I became a SAHM, I worked enough to get a small SS benefit. My DH is the main earner and my spousal (half of his) benefit will be greater. I've heard that I can take my small SS at 62 and switch to get the full spousal benefit at our FRA (we're close in age and he would not take his early). If that's so, then there is no reason for me to NOT take mine at 62. Yes, it'll be reduced but otherwise that $ is gone, right? Or would my spousal at FRA be reduced?

 

[Alan]

No need to duck because I've read so many threads on when to take SS that I'm never sure of the rules either.

Your plan matches mine. DW takes hers at 62, I file and suspend at my FRA and she files and gets a bump up to 0.5 of my FRA SS benefit. Can't remember if she needs to get to FRA before she can get the bump up. (She is 9 months younger than me but much lower SS estimate)

I may also have that wrong, and will be happy to be corrected.

 

[Running_Man]

I do not think you can get full 1/2 of spousal SS if you claimed your own at 62 spousal benefit will be 1/2 of spouses age 62 spousal benefit I believe. at least that is what I believe through my looking at website, I would be very happy to be in error on this though!

 

[Bestwifeever]

I do not think you can get full 1/2 of spousal SS if you claimed your own at 62 spousal benefit will be 1/2 of spouses age 62 spousal benefit I believe. at least that is what I believe through my looking at website, I would be very happy to be in error on this though!

Yes. And there is a timing issue here to get the max re spousal or own record benefit--my understanding is that if a lower-earning spouse applies earlier than FRA and the spousal benefit is more than his or her own benefit amount, the spousal benefit will automatically begin then and cannot be changed. In order to have the flexibility of choosing either his/her own benefit amount or the spousal benefit, and switch later, the lower-earning spouse has to wait until his/her FRA to file.

I am waiting til FRA to claim my spousal benefit. At 70 God willing I will switch to my own record, which by then will be more than the spousal benefit.

Of course I could be wrong, and often am, but here is more info http://www.forbes.com/sites/kotliko...and-suspend-at-63-to-enable-spousal-benefits/

 

[Alan]

Thanks for the quick responses. Decision time in 2.9 years.

 

[pb4uski]

Yes, I think it is right that if spouse claims before FRA that spousal benefit is reduced to reflect the spouse's claiming early.

DW was SAHM and is 9 months older than me. She'll claim her benefits at her FRA. I'll file and suspend 9 months later and she will claim spousal benefit, which will bring her benefit to 1/2 of my FRA benefit. Then I'll start my benefits when I turn 70.

 

[jim747]

My DW filed at 62. Her FRA was 66, thus the spousal benefit will be calculated at 38.66% of mine. Try this calculator Benefits for Spouses

 

[FireBug]

DW and I are 18 mths apart in age. Both of us have w*rked 30 years and both of our earnings records are about the same. I know SS can have a lot of ins and outs, with file and suspend, various options for married couples and I've done some preliminary research but backed off when I felt "Well, that probably wouldn't help in our situation". Most of these 'creative' solutions seem to apply well to couples with wide differences in age and earning records.

While still two years from deciding on a SS strategy, its been my early assumption that... If both partners are aprox the same age, with the same earning records, there really isn't to much to be done 'creatively' speaking. It's more in the vein of when do each of you want to start taking it.

So perhaps you good folks can comment with one of the following responses (given both partners are about same age with same SS record).

A. There's plenty you can do.... do more research to maximize your value.
B. Just decide when you want to take the $ (now, FRA, or 70).

I ask because DW will sometimes say... "I've heard about file and suspend, should we look in to it?" I just kind of say... "Don't think it will help in our case". If I'm wrong, I'll delve into more.

 

[pb4uski]

As long as her benefit is more than half of yours, then B as I understand it.

IIRC there is one thing you might do, and that is file and suspend because if you later come down with an illness you can effectively recapture those lost years.

 

[FireBug]

^^ Thanks!

 

[F4mandolin]

In my case....my current SS estimate (I am 57) is $1395 at 62. I plan on taking it at 62. My wife is only eligible for a spousal SS. If she takes it at 62 (which she plans to do) then she will not receive the 50%, but a reduction of that for every month short of HER full retirement of 67. I believe she could get 50% of mine.....but only if she waited until age 67. Jim747 has it right I think....at least in my case.

I sure wish the online SS articles would stop telling people they would get 7-8% for every year they put off taking SS. Not correct.....closer to 5% those first few years. It's gets going good after your FRA.

 

[PERSonalTime]

SAHM?


Sent from my iPad using Early Retirement Forum

 

[tessaduncan]

[

Yes. And there is a timing issue here to get the max re spousal or own record benefit--my understanding is that if a lower-earning spouse applies earlier than FRA and the spousal benefit is more than his or her own benefit amount, the spousal benefit will automatically begin then and cannot be changed. In order to have the flexibility of choosing either his/her own benefit amount or the spousal benefit, and switch later, the lower-earning spouse has to wait until his/her FRA to file. QUOTE]

Thanks for all the responses but I still see confusion in the distinction of "spousal" vs own benefit. I understand that taking the spousal early will result in a reduced spousal benefit but wasn't sure if that was the case when taking it on my record and then switching later. It appears, per the quote above from Bestwifeever, that I don't get to make that choice. I believe that's most likely the case but haven't been able to find supporting documentation.

SAHM = Stay At Home Mom

 

[Animorph]

Try this for strategy:


Social Security Benefits Evaluator - T. Rowe Price


Spousal benefits:


Retirement Planner: Benefits For You As A Spouse


IIRC, claiming before FRA permanently reduces your benefit, spousal or your own. I'm not sure if you have a choice of either before FRA.


DW and I are about equal in benefits, though 5 years different in age. That just means I don't have to file and suspend. I can claim at 70 and DW can take spousal benefits a bit later at her FRA. then she can claim her benefit at age 70.


If we were the same age, I would have to file and suspend a little after age 65 in order for DW to claim spousal benefits. That is definitely worth doing for anyone who can.

 

[tessaduncan]

Try this for strategy:


Social Security Benefits Evaluator - T. Rowe Price


Spousal benefits:


Retirement Planner: Benefits For You As A Spouse


IIRC, claiming before FRA permanently reduces your benefit, spousal or your own. I'm not sure if you have a choice of either before FRA.

Thanks. I've already been to those sites but just wanted to read it in plain English like you (and Bestwife) just did above in bold. I have no intention of taking it early (still have 3 yrs so that could change) but didn't want to miss any loophole as I work on our retirement strategy.

 

[supernova72]

I didn't realize that the SS calculator assumes if you draw at 62 it assumes you work until 62 as well. I went in and found an alternative calculator on the SS site and put in stop working at 55 and draw at 62. It only lowered it to $1670 a month vs. like $1730.


I'm 54 and have 35 yrs worth of history now (although the early yrs are small). Like washing dishes at Royal Fork buffet in 1979 small : )

 

[PERSonalTime]

Tessaduncan,

Thanks for the explanation.


Sent from my iPad using Early Retirement Forum

 

[gerntz]

I've heard that I can take my small SS at 62 and switch to get the full spousal benefit at our FRA (we're close in age and he would not take his early). If that's so, then there is no reason for me to NOT take mine at 62. Yes, it'll be reduced but otherwise that $ is gone, right? Or would my spousal at FRA be reduced?

I believe your spousal at FRA will be reduced by the same percentage as your own age 62 benefit is reduced from its amount at your FRA. This is what we understand will happen with my wife's spousal on my account who took her benefit before FRA. Net, your small personal SS benefit may not be worth the hurt it causes to your spousal benefit if the spousal benefit is much larger. In our case, the difference between her benefit & her spousal were pretty small such that it didn't much matter.

 

[PawPrint53]

If someone plans to take SS at age 70 and dies at 68, for example, could the surviving spouse wait until the deceased would have turned 70 to get the full spousal benefit?

 

[mathjak107]

Yes, it's about 'when' <ducking>. Before I became a SAHM, I worked enough to get a small SS benefit. My DH is the main earner and my spousal (half of his) benefit will be greater. I've heard that I can take my small SS at 62 and switch to get the full spousal benefit at our FRA (we're close in age and he would not take his early). If that's so, then there is no reason for me to NOT take mine at 62. Yes, it'll be reduced but otherwise that $ is gone, right? Or would my spousal at FRA be reduced?

if you file before your fra for your own benefit ,you can not switch to spousal ever .

what you get is your own benefit which is reduced forever.

plus , when the other spouse files you get the difference added to your early benefit from what 1/2 the spouses full less what your full would have been added to your own.

it will work out to be less than 1/2 the spouses if you took your own early.

 

[ivinsfan]

If someone plans to take SS at age 70 and dies at 68, for example, could the surviving spouse wait until the deceased would have turned 70 to get the full spousal benefit?

Confusing to understand, but I thought the spousal benefit is capped at 50% of the primary spouse's number at their FRA..in other the words, the spousal benny does not rise after that date...the only number that would change the payout is the age the spouse starts to collect the spousal benefit.

Now, the survivor benefit when one spouse remains and both of them are drawing off the same earnings records, would be the highest of the 2 monthly payments. Is this correct? My DH is now FRA and I will be eligible to draw a spousal later this year if I want to.

 

[Sunset]

DW and I are 18 mths apart in age. Both of us have w*rked 30 years and both of our earnings records are about the same. I know SS can have a lot of ins and outs, with file and suspend, various options for married couples and I've done some preliminary research but backed off when I felt "Well, that probably wouldn't help in our situation". Most of these 'creative' solutions seem to apply well to couples with wide differences in age and earning records.

While still two years from deciding on a SS strategy, its been my early assumption that... If both partners are aprox the same age, with the same earning records, there really isn't to much to be done 'creatively' speaking. It's more in the vein of when do each of you want to start taking it.

So perhaps you good folks can comment with one of the following responses (given both partners are about same age with same SS record).

A. There's plenty you can do.... do more research to maximize your value.
B. Just decide when you want to take the $ (now, FRA, or 70).

I ask because DW will sometimes say... "I've heard about file and suspend, should we look in to it?" I just kind of say... "Don't think it will help in our case". If I'm wrong, I'll delve into more.

You should listen to DW.
Comparing both taking it at FRA, you can do better by file and suspend given your equal age and earnings.
example: you at FRA file and suspend.
DW get 1/2 your FRA, and hers increases 8% per yr
You take yours at 70 (get the max for you).
DW takes hers at 70 (get the max for her).

This is my understanding, you can check it with SS to be sure.

 

[pb4uski]

Confusing to understand, but I thought the spousal benefit is capped at 50% of the primary spouse's number at their FRA..in other the words, the spousal benny does not rise after that date...the only number that would change the payout is the age the spouse starts to collect the spousal benefit.

Now, the survivor benefit when one spouse remains and both of them are drawing off the same earnings records, would be the highest of the 2 monthly payments. Is this correct? My DH is now FRA and I will be eligible to draw a spousal later this year if I want to.

Yes, but I think the question was what if the higher earner had filed adn suspended and not yet started collecting benefits, what the spousal survivor benefits will be.

We could have that issue as DW will be getting the spousal benefit from my FRA onward, but I plan to file and suspend and claim at 70. The question is if I die between my FRA and age 70, will DW's survivor benefit be my benefit on the date I die or can she wait until I woudl have been 70 and claim the higher benefit (the benefit grows at a simple 8% a year from FRA to age 70).

I don't know the answer and am curious myself.

 

[ivinsfan]

Yes, but I think the question was what if the higher earner had filed adn suspended and not yet started collecting benefits, what the spousal survivor benefits will be.

We could have that issue as DW will be getting the spousal benefit from my FRA onward, but I plan to file and suspend and claim at 70. The question is if I die between my FRA and age 70, will DW's survivor benefit be my benefit on the date I die or can she wait until I woudl have been 70 and claim the higher benefit (the benefit grows at a simple 8% a year from FRA to age 70).

I don't know the answer and am curious myself.

I'd like to know the answer to that one too, as my DH has a business he loves and will keep working...so to put it a little more simply, what happens when you have a file and suspend and a death occurs to the F and S spouse while a spousal benefit is being paid out. That doesn't sound very simple either!

 

[Sunset]

Confusing to understand, but I thought the spousal benefit is capped at 50% of the primary spouse's number at their FRA..in other the words, the spousal benny does not rise after that date...the only number that would change the payout is the age the spouse starts to collect the spousal benefit.

My understanding is: No.

See here they have an example:
Secret Ways to Boost Your Social Security-Page 2-Kiplinger

Now, the survivor benefit when one spouse remains and both of them are drawing off the same earnings records, would be the highest of the 2 monthly payments. Is this correct? My DH is now FRA and I will be eligible to draw a spousal later this year if I want to.

My understanding is: Yes.

But I am guessing that it would be frozen at the value of point of death, ie the dead spouse does not keep earning increases to age 70. So it would be like they say at age 69 they ceased the F and S , if they died at age 69.