Ask Liz Weston

Get smart with your money

spousal benefits

Q&A: When should a second earner start taking social security?

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Dear Liz: I am 64 and still working and earning decent pay. My wife is 61 and retired. I have been a high earner for most of my life while she was working and raising our family. I don’t plan to retire anytime soon. Is it a good idea for her to start taking Social Security at 62?

Answer: The vast majority of people are better off delaying their Social Security applications for as long as possible so they can maximize their lifetime benefits. It’s especially important for you to delay, since as the higher earner, your benefit will determine what the survivor gets.

Your wife, however, may be one of the few who is better off starting early. That may be the case if you continue to delay your application, and her eventual spousal benefit is more than what she would receive on her own record.

If both of those things are true, she could start her own reduced retirement benefit at 62, then switch to a spousal benefit of up to half of your check after you apply for your benefits — preferably at age 70, when they max out.

Your wife won’t be able to get a spousal benefit until you apply for your own. On the other hand, she won’t be allowed to switch benefits if you’re already receiving yours when she applies.

Clearly, there are a lot of rules involved, and the best course for you two will depend on the specifics of your situation. You’d be smart to use a Social Security claiming site, such as Maximize My Social Security or Social Security Solutions, to help you determine your best approach.

Q&A: Benefits’ disappearance is no accident

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Dear Liz: You recently indicated that restricted applications for Social Security spousal benefits are no longer available to people born on or after Jan. 2, 1954. Who is responsible for this change, and when was that enacted? Is there any way it can be reversed?

Answer: Congress is unlikely to revive what was widely seen as a loophole that allowed some people to take spousal benefits while their own benefits continued to grow.

Congress changed the rules with the Bipartisan Budget Act of 2015. As is typical with Social Security, the change didn’t affect people who were already at or near typical retirement age. So people who were 62 or older in 2015 are still allowed to file restricted applications when they reach their full retirement age of 66. They can collect spousal benefits while their own benefits accrue delayed retirement credits, as long as the other spouse is receiving his or her own retirement benefit. (Congress also ended “file and suspend,” which would have allowed one spouse to trigger benefits for the other without starting his or her own benefit.)

Q&A: Social Security spousal benefits

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Dear Liz: My wife plans to file for her Social Security benefit when she turns 66 in April 2020. I plan to file for my benefit at age 70 in July 2022. Can I file for a spousal benefit when my wife files in 2020? Can my wife claim a spousal benefit in 2022 when I file for my own benefit, assuming it is more than her own benefit? Will my wife’s spousal benefit increase like my benefit does between my ages of 66 to 70, or does it max out at my age 66?

Answer: Because you’ve reached your full retirement age of 66 and you were born before Jan. 2, 1954, you are still allowed to file a restricted application for spousal benefits once your wife applies for her own benefit. When your benefit maxes out at age 70, you would switch to your own because there’s no incentive to further delay.

Restricted applications are no longer available to people born later. Instead, when they apply for benefits they are deemed to be applying for both their own and any spousal benefit to which they might be entitled. They’re given the larger amount and typically can’t switch later.

One of the exceptions could apply in your case, however. Your wife won’t be able to take a spousal benefit when she applies because you won’t have started your benefit. Once you start, if her spousal benefit based on your work record is larger than what she’s receiving based on hers, she could switch.

Because only one spousal benefit is allowed per couple, you’ll want to investigate which could result in more money before you apply.

As for your last question: Spousal benefits don’t earn the delayed retirement credits that can increase a worker’s retirement benefits by 8% annually between full retirement age and 70. If your wife had started spousal benefits before her own full retirement age of 66, the amount would have been permanently reduced — she would receive less than 50% of the benefit you’d earned at your full retirement age. But she won’t get more than 50% if she starts them after her full retirement age.

Q&A: Social Security spousal benefits

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Dear Liz: I’m confused by Social Security benefits for divorced spouses, which you’ve written about recently. I was told that because I remarried (after age 60), I have to wait until my ex-husband died before receiving a part of his benefits. Is this still true for remarried ex-spouses? My ex does collect Social Security and I collect my small benefit (both of us started at full retirement age).

Answer: Yes. Divorced spousal benefits would be available only if you are currently unmarried. Survivor benefits, on the other hand, could still be available if you remarried at 60 or older.

Spousal and divorced spousal benefits can be up to 50% of the worker’s benefit, while survivor and divorced survivor benefits can be up to 100%.

Q&A: Divorced spousal benefits

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Dear Liz: I never expected to be where I am financially. I work as an independent piano teacher and my present earnings are just enough to get by (which isn’t saying much in Southern California). I was married for 18 years and am now single, with no plans to remarry.

After I turn 66 next year, I intend to apply for Social Security benefits as a divorced spouse because my personal Social Security benefits would amount to just $875 a month and my ex is doing quite well (with earnings somewhere in the six-figure range). I anticipate the divorced spousal benefit will be greater than my own.

But I have a lot of questions. Will waiting until my former husband is 66 or 70 (he is 64) do anything to maximize my benefits? Will my Social Security be taxable? How much am I allowed to continue earning if I also receive Social Security?

Answer: Spousal and divorced spousal benefits can help lower earners get larger Social Security checks. Instead of just receiving their own retirement benefit, they can receive up to half of the higher earner’s benefits at the higher earner’s full retirement age. But divorced spousal benefits are different in some important ways from the spousal benefits available to married people.

If you were still married, you couldn’t get a spousal benefit unless he was already receiving his own.

Divorced spousal benefits are available if your marriage lasted at least 10 years and you aren’t currently married. If you meet those qualifications, you can apply for divorced spousal benefits as long as both you and your ex are at least 62 — he doesn’t need to have started his own benefit. Your divorced spousal benefit will be based on his “primary benefit amount,” or the benefit that would be available to him at his full retirement age (which is 66 years and two months, if he was born in 1955). It doesn’t matter if he starts early or late; that doesn’t affect what you as his ex would receive.

Spousal and divorced spousal benefits don’t receive delayed retirement credits, so there’s no advantage for you to delay beyond your own full retirement age (which is 66, if you were born in 1954) to start. Your benefit would have been reduced if you’d started early, though, so you were smart to wait.

Also, waiting until your full retirement age means you won’t be subjected to the earnings test that otherwise would reduce your checks by $1 for every $2 you earn over a certain amount ($17,640 in 2019).

Q&A: Sorting out the ex’s benefits

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Dear Liz: I am 68 and plan to delay starting Social Security until I’m 70. I was married for 15 years prior to an amicable divorce 15 years ago. My ex just turned 60 and remains unmarried but may possibly marry at some future time. Does she qualify for survivor benefits? If so, what can I do to help ensure that she can efficiently apply for that benefit? We have already reviewed her option to assume my benefit upon my demise, but our benefits are virtually at identical levels and so that option does not seem applicable.

Answer: You seem to have confused divorced survivor benefits with divorced spousal benefits. She may well be eligible for both, but the only way you can help her get survivor benefits is to die. It’s great that you two are still friends, but that may be taking friendship a little too far.

Your ex is too young to claim a divorced spousal benefit, which isn’t available until she turns 62. She wouldn’t be able to get the full amount, which is 50% of your benefit at your full retirement age, until she reaches her own full retirement age. If she was born in 1959, then her full retirement age is 66 years and 10 months.

Furthermore, she would get a divorced spousal benefit only if that’s larger than her own benefit. If your benefits are “virtually identical,” that’s not likely to be the case.

If you should keel over tomorrow, though, she would be eligible to receive a divorced survivor benefit and put off receiving her own. Survivor benefits are available starting at age 60, or age 50 if the survivor is disabled, or at any age if the survivor cares for the dead person’s child who is under 16. Your ex also could marry at 60 or older without losing her survivor benefit. People who receive divorced spousal benefits, on the other hand, lose that benefit if they remarry.