Spousal Benefits Social Security ?

[Romer]

Wanting to make sure I have this fully understood. I will use our numbers as an example. I thought it was best to wait until both of us were 67. Now thinking otherwise

DW FRA is $11,700
My FRA is $44,844

So if we both take it at 67 the Spousal Benefit is $22,422
The $22,422 is made up of her SS $11,700 + the Spousal Makeup of $10,622. There are two components.

As long as I don't file until 67 (She is 30 days older) the spousal Makeup value doesn't change even if she starts SS at age 63.

However her component to the Spousal does change for 63. Her SS at 63 is $8,820.

So if she files at 63 and I file at 67, the spousal at 67 is $9,408+$10,622=$19,482

She could collect 4 years of SS of $42,648

The lower total SS at 67 then would be $2,940 less a year. At that value it would take 14.5 years (age 81.5) to break even (simple math with other factors like taxes, COLA, etc not considered)

Doing this doesn't change her Survivor benefit which is equal to my FRA value

The change to my understanding is that only her portion of the Spousal Benefit scales by her taking SS early. The spousal makeup is independent and doesn't get reduced at 67, but will if I file earlier than my FRA. I knew about both components, but thought they both scaled if she filed early even if I didn't.

Is this correct?

 

[mathjak107]

Wanting to make sure I have this fully understood. I will use our numbers as an example. I thought it was best to wait until both of us were 67. Now thinking otherwise

DW FRA is $11,700
My FRA is $44,844

So if we both take it at 67 the Spousal Benefit is $22,422
The $22,422 is made up of her SS $11,700 + the Spousal Makeup of $10,622. There are two components.

As long as I don't file until 67 (She is 30 days older) the spousal Makeup value doesn't change even if she starts SS at age 63.

However her component to the Spousal does change for 63. Her SS at 63 is $8,820.

So if she files at 63 and I file at 67, the spousal at 67 is $9,408+$10,622=$19,482

She could collect 4 years of SS of $42,648

The lower total SS at 67 then would be $2,940 less a year. At that value it would take 14.5 years (age 81.5) to break even (simple math with other factors like taxes, COLA, etc not considered)

Doing this doesn't change her Survivor benefit which is equal to my FRA value

The change to my understanding is that only her portion of the Spousal Benefit scales by her taking SS early. The spousal makeup is independent and doesn't get reduced at 67, but will if I file earlier than my FRA. I knew about both components, but thought they both scaled if she filed early even if I didn't.

Is this correct?

i am still confused here

from what is being said .

if she files early she gets a reduction to her benefit .

but if both she and the higher earning soouse file early then there is a double cut besides the original reduction

i am still fuzzy on if husband files after his fra and she files pre fra as to whether there is still a double cut

 

[Romer]

i am still confused here

from what is being said .

if she files early she gets a reduction to her benefit .

but if both she and the higher earning soouse file early then there is a double cut besides the original reduction

i am still fuzzy on if husband files after his fra and she files pre fra as to whether there is still a double cut

As I understand it, if I files at 68-70, it would not make any difference to the spousal benefit as it is based on my FRA value

 

[mathjak107]

so it looks like i think i have it now thanks to this explanation.

if i have it correct when it comes to spousal the lower earner who is filing pre fra gets a deduction in the spousal portion as well as their own benefit whether the higher earner files pre fra or after .

it seems solely dependent on when the lower earner files .

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. A spousal benefit is reduced 25/36 of one percent for each month before normal retirement age, up to 36 months. If the number of months exceeds 36, then the benefit is further reduced 5/12 of one percent per month.

For a spouse who is not entitled to benefits on his or her own earnings record, this reduction factor is applied to the base spousal benefit, which is 50 percent of the worker's primary insurance amount. For example, if the worker's primary insurance amount is $1,600 and the worker's spouse chooses to begin receiving benefits 36 months before his or her normal retirement age, we first take 50 percent of $1,600 to get an $800 base spousal benefit. Then we compute the reduction factor, which is 36 times 25/36 of one percent, or 25 percent. Applying a 25 percent reduction to the $800 amount gives a spousal benefit of $600. Thus, in this case, the final spousal benefit is 37.5 percent of the primary insurance amount.


you can see it in this chart


https://www.ssa.gov/oact/quickcalc/earlyretire.html

 

[oldtimer]

Let me suggest that before going down the spousal benefit rabbit hole, one should confirm that the lower earners PIA is less than half of the higher earners PIA. If it is, then use Mike Piper's opensocialsecurity.com calculator for all your what-ifs.
However, if the lower earners PIA is greater than or equal to half of the higher earners PIA, then there is no spousal benefit for either spouse. An example would be high earner PIA = $3000 and lower earner $2000.

 

[MuirWannabe]

Open Social Security suggested DW to file at 62 & for me to file at 70, so that is what DW did/I will do, we could have easily waited for DW to file at FRA of 67

I was not aware of / nor our Fidelity Rep suggested to check out the Fidelity SS software.

Oh, well I hope Mr Piper's Open Social Security was/is right .

Right there with you. Hopefully it’s the right choice for us. DW’s PIA is definitely less than half mine. She just turned 62 in December and got her first SS payment yesterday. I’m 61 and plan on waiting until 70.

 

[Romer]

Wanting to make sure I have this fully understood. I will use our numbers as an example. I thought it was best to wait until both of us were 67. Now thinking otherwise

DW FRA is $11,700
My FRA is $44,844

So if we both take it at 67 the Spousal Benefit is $22,422
The $22,422 is made up of her SS $11,700 + the Spousal Makeup of $10,622. There are two components.

As long as I don't file until 67 (She is 30 days older) the spousal Makeup value doesn't change even if she starts SS at age 63.

However her component to the Spousal does change for 63. Her SS at 63 is $8,820.

So if she files at 63 and I file at 67, the spousal at 67 is $8,820+$10,622=$19,482

She could collect 4 years of SS of $42,648

The lower total SS at 67 then would be $2,940 less a year. At that value it would take 14.5 years (age 81.5) to break even (simple math with other factors like taxes, COLA, etc not considered)

Doing this doesn't change her Survivor benefit which is equal to my FRA value

The change to my understanding is that only her portion of the Spousal Benefit scales by her taking SS early. The spousal makeup is independent and doesn't get reduced at 67, but will if I file earlier than my FRA. I knew about both components, but thought they both scaled if she filed early even if I didn't.

Is this correct?

corrected a typo where I used the wrong years value for 63. Total was correct though

 

[latexman]

Excellent discussion!

DW just filed in Jan. at 66.5 (she's a July 21, 1957 model), and is expecting her first direct deposit on Feb. 28th. I'm a June 1957 model and plan to wait to 70 to file. Will DW have to file for spousal when I file (June 2027), or will SS automagically do that for her?

So, our CU shows DW got her first direct deposit from SS yesterday night, Feb. 26th at 11:24 p.m. Is that typical? Two days before the 4th Wednesday?

 

[MissMolly]

So, our CU shows DW got her first direct deposit from SS yesterday night, Feb. 26th at 11:24 p.m. Is that typical? Two days before the 4th Wednesday?

Yes. I always get mine in my account on Monday's.

 

[Shanky]

My reading from the actual Social Security Administration website and the law establishing Social Security is that the spousal benefit is based on the worker's Primary Insurance Amount (PIA), which is a calculated number that does not change, even if the worker starts taking benefits early. If the spouse retires early, then the spousal benefit is reduced from 50% of the worker's PIA, not reduced from 50% of the worker's actual benefit (which will be less than PIA if the worker retired early)

I have read the following sources that lead to to the above conclusion.

From the SSA website:

https://www.ssa.gov/oact/quickcalc/...gins receiving,spousal benefit is not reduced.

https://www.ssa.gov/benefits/retirement/planner/applying7.html

42 U.S.C. Subchapter II - FEDERAL OLD-AGE, SURVIVORS, AND DISABILITY INSURANCE BENEFITS

See Sections 402 and 415

https://www.law.cornell.edu/uscode/text/42/chapter-7/subchapter-II

I can confirm this. I filed at 62 and was the high earner, my wife was stay at home Mom, then volunteer work, so SS benefit was minimal. She is nearly 5 years older than me, so when I was 62, she was her full Retirement age. (66.5). Whether I filed at 62, 67 or 70, her benefit was 50% my Full Retirement Benefit. This really changed the math on our “should I file at 62” scenario. The fact that she would go 5 or 8 years collecting nearly nothing until I filed, pushed our “break even” as a couple to nearly 85 years old for me.

 

[imnontrad]

I am an admin for a (50K) FaceBook group specifically to answer Social Security questions.

When you file for SS, you will be "deemed filing" for your own benefit and the spousal benefit and will get the higher of the two amounts.
Someone cannot apply for the spousal benefit (if higher than their own) until after their spouse starts SS.
An exception is if someone applies for spousal benefits based on a divorced spouse. Then the rules are that the ex-spouse must be at least 62 and you must have been divorced for at least 2 years or the ex must have started their SS.
The Spousal benefit is actually composed of two parts - your own benefit and a "spousal excess" (aka "top off") equal to the difference between your own benefit at FRA and 50% of your spouse's FRA amount.

 

[statsman]

Excellent discussion!

DW just filed in Jan. at 66.5 (she's a July 1957 model), and is expecting her first direct deposit on Feb. 28th. I'm a June 1957 model and plan to wait to 70 to file. Will DW have to file for spousal when I file (June 2027), or will SS automagically do that for her?

So, our CU shows DW got her first direct deposit from SS yesterday night, Feb. 26th at 11:24 p.m. Is that typical? Two days before the 4th Wednesday?

I know many here have said to be patient. But I filed on January 9th to start SS benefits on March 1 (for a first SS payment in April) and to start Medicare also in April. Not a word. Still in review.

I'm glad to see someone is getting their SS benefits in a timely fashion.

 

[MissMolly]

I know many here have said to be patient. But I filed on January 9th to start SS benefits on March 1 (for a first SS payment in April) and to start Medicare also in April. Not a word. Still in review.

I'm glad to see someone is getting their SS benefits in a timely fashion.

I applied on Aug 1 to start benefits in November (first payment in December). I got my approval letter on Dec 7 - only 2 weeks before the first payment arrived. This is not unusual.

 

[Gumby]

I know many here have said to be patient. But I filed on January 9th to start SS benefits on March 1 (for a first SS payment in April) and to start Medicare also in April. Not a word. Still in review.

I'm glad to see someone is getting their SS benefits in a timely fashion.

My birthday was in January, meaning my first month of SS eligibility was February and the earliest I could get the first check was March.

I applied on-line for social security on 12/6/20. On 2/8/21, they called me and asked me to send my passport to prove my citizenship, which I did that day. They returned it on 2/16/21. I received my first deposit on 3/11/21, which was the first time I knew that my application had been approved. The actual approval letter that I received in the mail is dated 3/14/21, and it never showed as approved on the computer before the money arrived. In fact, it never even showed that anyone was reviewing it, only that it had been received (i.e. - step 1 in the bar graph.)

Hope that helps.