Spouse benefit while you're both living?

[qwerty3656]

Missing a basic understanding. My wife and I are both the same age. My social security benefit is more than twice hers. I thought if we both wait till we are 67, she would get half my benefit. When we run OpenSocialSecurity, it has me starting at 70 and my wife starting at 67, but it is showing her getting her benefit rather than half of mine (so the total is my benefit at 70 plus her benefit at 67)? Is that right? When does the spousal benefit come into play?

EDIT: THERE IS A WHOLE OTHER COLLUMN FOR SPOUSAL BENFIT - YOU CAN DELETE/IGNORE THIS QUESTION

 

[tango2]

As I understand it, your wife will get amt equal to 1/2 your fra amt. however if her benefit is greater than 1/2 yours she takes her’s. She will not get any of the increase if you wait till you are age 70. She will only get that if you die first. Then she will get hers or yours whichever is larger but not both. The way it works is she has to draw hers first then gets part of yours to equal the larger amt. The spousal benefit went away about 2 years ago.

 

[RetiredHappy]

Each person's contribution into Social Security, is used to calculate the contributor's Primary Insurance Amount (PIA), at Full Retirement Age. Spousal amount is 50% of the other person's PIA. If your PIA is more than twice your wife's PIA, then at her attained age of 67, she will be drawing on the spousal benefit, which is half your PIA. Her own earnings record is no longer "directly" used in the computation of her SS. Your SS at 70 years old will be more than twice of her spousal benefit because you delay starting your SS benefit.

 

[timbervest]

OpenSocialSecurity calculates the strategy that maximizes the expected benefit you will on a combined basis collect over your lifetimes. What it is saying is:

• You wait until age 70 to maximize your benefit
• Your wife files for her benefit now
• When you file for your benefit at age 70 she continues to collect her benefit plus the difference between that and 1/2 your benefit amount at age 67 (technically the same as "switching to 1/2 of your benefit")
• She does not get extra amounts for your delayed benefit.

you can try other strategy scenarios but the present value will probably be less.

Others -- please correct this if I am mistaken

 

[cathy63]

I think your spouse cannot collect the spousal benefit until you start collecting your own. So if you are the same age and she files at age 67, then she will collect her own benefit for 3 years until you file for yours, then she will be able to bump up to half of your PIA benefit (i.e. half of what you would have gotten at age 67, not half of what you actually get at age 70).

 

[Romer]

I am glad you figured it out. I didnt even know about the spousal benefit. I thought she just got what she earned which is 25% of mine so it was a nice surprise

I got aa similar answer to what you figured out

She needs to wait until 67 so she can get the maximum (50%) spousal benefit.

If you take your benefit at 67, she applies for the spousal benefit and gets half your benefit

If you wait until later then she files for her benefit and then applies for spousal benefits when you do. She still caps out at half your benefit at 67. Whether they say she gets her benefit and a bump to equal the spousal benefit or just gets the spousal benefit, its the same dollar value.

Even though you figured it out, I think this is a good thread for history as this isn't something that is obvious until you start digging in to social security

 

[EastWest Gal]

Let’s see if I have this right. Let’s say spouses are the same age but one spouse has a significantly higher income. If the high income spouse waits until 70, the couple loses 3 years of 50% spousal benefit between ages 67 and 70. The low income spouse only gets 50% of the FRA benefit, not the delayed benefit, but only starts get that benefit when the high income spouse files. Is that correct?

 

[VanWinkle]

Let’s see if I have this right. Let’s say spouses are the same age but one spouse has a significantly higher income. If the high income spouse waits until 70, the couple loses 3 years of 50% spousal benefit between ages 67 and 70. The low income spouse only gets 50% of the FRA benefit, not the delayed benefit, but only starts get that benefit when the high income spouse files. Is that correct?

Yes that is correct!!

 

[ivinsfan]

Let’s see if I have this right. Let’s say spouses are the same age but one spouse has a significantly higher income. If the high income spouse waits until 70, the couple loses 3 years of 50% spousal benefit between ages 67 and 70. The low income spouse only gets 50% of the FRA benefit, not the delayed benefit, but only starts get that benefit when the high income spouse files. Is that correct?

If each person in the couple has earned their own benefit the lesser earning person can file for their own benefit at their FRA. So to be 100% correct what you would be losing is the difference between 100% of the low earning spouse benefit.. and the spousal benefit top off. Say lower spouse benefit 100 dollars a month, lower earning spouse total spousal benefit 110. Lower spouse can collect a 100 a month from FRA until spouse files at FRA or later and then get 110 dollars a month.



But these number are both based on FRA ages.



I'm not sure if that's what you were saying. In this case we aren't talking pure spousal benefit as much as spousal benefit top off. With a pure spousal benefit the person cannot claim a spousal until the primary earner files.


What Cathy63 said...




But of course the advantage of the higher earning spouse waiting until 70 means that when one person in the couple dies the other will get the highest check as a survivor benefit. Each couple can decide if that trade off is worth it.