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    Yes, a Nonworking Spouse Can Collect Social Security.

    May 12, 2010

    Dear Carrie,

    Can my nonworking wife retire and receive social security benefits while I am still employed?

    A Reader


    Dear Reader,

    There's a lot of confusion about whether or not a nonworking spouse is entitled to Social Security benefits, so I'm glad you asked this question. The short answer is that a nonworking spouse who has reached age 62 can collect Social Security based on the working spouses earning's record once the working spouse has filed for benefits.

    You say that you're still employed, so I'm going to assume that you're not collecting Social Security yet. I'm also going to assume, for the sake of simplicity, that your wife doesn't qualify for her own benefits. (If she did, she could file in her own name regardless of your filing status once she turned 62.) If my assumptions are accurate, while your wife may be eligible for Social Security benefits, she can't collect until you file for benefits yourself.

    This sounds clear enough, but as with so much that has to do with the government and money, there are a number of rules and exceptions to complicate things a bit.

    What and when a nonworking spouse can collect

    The Social Security benefit of a nonworking spouse is 50 percent of the full benefit of the working spouse. So if your full benefit is $2,000, your wife would be able to collect $1,000. However, the age limits that apply to worker benefits also apply to spousal benefits. There are two choices. Your wife can:

    • Take Social Security at age 62. But the 50 percent spousal benefit would be further reduced by about 25 percent for the rest of her life.
    • Wait until what the IRS designates as her “full retirement age” (between 65 and 67, depending on when she was born) to receive the full spousal benefit. In this case she will receive 50 percent of your full benefit.

    Just for the record, there is an exception to the age requirement if your spouse is caring for your child who is under age 16.

    Why timing is important

    Both you and your wife should give a lot of thought to when to begin collecting Social Security. For instance, if you applied early at age 62, your benefit would be permanently reduced. If your wife also elected to take Social Security early, her 50 percent benefit would be permanently reduced. That could make a big hole in your monthly income.

    While it might seem smart to begin taking benefits as soon as possible—after all you'll then collect checks for a longer period of time—it's a good idea to look at your "break even age" before making a final decision. This is how long you need to live to make sure choosing a later date will give you greater lifetime benefits. You can find a break-even calculator at IRS.gov. It's definitely worth a look. Chances are, the longer you can each wait, the better.

    Another strategy

    You don't say how old you are, but if you've reached your full retirement age, you could file for benefits even though you're still working and your wife could then file for the spousal benefit. At full retirement age, there's no limit on the amount you can earn and still collect full benefits. However, if you prefer to delay taking your own benefits, there's another strategy to consider. The IRS lets you file for Social Security and then immediately suspend your benefits. This would allow your wife to begin collecting a spousal benefit based on your earnings while you continue to work. At the same time, your own future benefit would continue to grow. Another plus to this strategy is that the larger your eventual benefit, the larger your wife's survivor benefit. That's because, should you die first, your wife would collect 100 percent of your Social Security.

    As you can see, there are a number of things to consider. I'd suggest you talk to your financial or tax advisor about the best strategy for both you and your wife. A little planning can help maximize the total benefit for your household. And why not? After all, you've earned it!

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