Social Security Moves Married Folks Need to Make

Social Security Moves Married Folks Need to Make

If both members of a married couple qualify for Social Security benefits, it is best to think about when each should file.

When many older Americans get closer to retirement, they often cram in as much information regarding Social Security benefits as possible.

Along the way, there invariably will be missing pieces of information that will prevent one from taking full advantage of the monthly checks and claiming all of the money that they’re entitled to.

For many experts, the most prudent financial decision is generally very simple: wait on filing for the benefits as long as possible—preferably till age seventy.

“Workers planning for their retirement should be aware that retirement benefits depend on age at retirement. If a worker begins receiving benefits before his/her normal (or full) retirement age, the worker will receive a reduced benefit,” the Social Security Administration (SSA) says.

“A worker can choose to retire as early as age sixty-two, but doing so may result in a reduction of as much as thirty percent,” it continues.

But what about married folks out there? Do they need to do anything special? Yes, there are indeed some proper steps an individual needs to take to max out those monthly benefits—and that final total might even be larger than what one anticipated.

Spousal Benefits

According to a finance expert on the Motley Fool, “spousal benefits are generally available to those who are married to someone receiving Social Security checks. They’re particularly helpful for those who either aren’t eligible for their own benefits or are receiving very little from Social Security.”

The maximum amount that an individual can receive via spousal benefits is half of the higher-earning spouse's benefit amount at their full retirement age (FRA). But if the widow or widower qualifies for Social Security on their own record and the monthly payments are higher, they have the option to switch to their own benefit at any time between ages sixty-two and seventy. There is also a “one-time lump-sum death payment of $255 (that) can be paid to the surviving spouse if he or she was living with the deceased; or, if living apart, was receiving certain Social Security benefits on the deceased’s record,” the SSA says.

Claiming Strategy

If both members of a married couple qualify for Social Security benefits, it is best to think about when each should file.

“You can begin collecting benefits at sixty-two years old or any age thereafter, but the age you file will directly affect the size of your monthly payments,” the expert writes. “The only way to receive the entire benefit amount you’re entitled to is to claim at your FRA—which is either age sixty-six, sixty-seven, or somewhere in between depending on the year you were born.”

When One Passes

It is also important to weigh options in the event a spouse passes away, as that decision could dictate how much one receives in benefits in the years ahead. 

The expert notes that “by being strategic about when you both claim benefits, you can make the most of survivors benefits.”

“For example, if the higher-earning spouse is significantly older, it may make sense for that person to delay benefits. If he or she does pass away first, then, the surviving spouse will earn larger checks than if the deceased spouse claimed earlier,” she adds.

Ethen Kim Lieser is a Washington state-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn.

Image: Reuters