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How Can Couples Max Out Social Security Benefits?

Key Points
  • While delaying filing generally means a higher Social Security benefit, with a little planning couples may be able to optimize their benefits over the short and long term.

  • Each couple’s finances, birth dates, relative ages, anticipated longevity and earnings records all factor in, but there are a few general guidelines that can help couples understand their options.

  • Review these 5 strategies to see how they might apply to your own situation.

Dear Readers,

Are you and your spouse nearing that magic age when you can file for Social Security benefits? If so, you've got a lot to think about. Because while waiting longer to file generally means a higher monthly benefit, with a little planning couples may be able to optimize their benefits over the short and long term.

Of course, there's no one-size-fits-all approach. Each couple’s finances, birth dates, relative ages, anticipated longevity, and earnings records all factor in, but there are a few general guidelines that can help you get started.

Social Security basics everyone should consider

Before we get into specifics for couples, let's review some Social Security basics that should factor into everyone's decision on when to file.

  • If you file at 62 (the earliest age possible), your monthly benefit will be permanently reduced by 25-30 percent based on your full retirement age. If you file at any time between 62 and your full retirement age (FRA), your benefit will be permanently reduced by a certain percentage accordingly.
  • If you delay filing until age 70, your monthly benefit will increase approximately 8 percent for every year you wait past FRA—a potential increase of 32 percent if your FRA is 66.
  • If you file before FRA and continue to work, your benefits are reduced $1 for every $2 you earn over a certain amount ($17,640 in 2019). The year of your FRA, benefits are reduced $1 for every $3 you earn over a certain amount ($46,920 in 2019). Your monthly benefit will be readjusted to pay you back the amounts withheld once you reach FRA.
  • At FRA, your benefit won’t be reduced regardless of how much you earn.

A special consideration for couples: the spousal benefit

The spousal benefit allows a wife or husband—including a spouse who never worked—to collect up to 50 percent of what a working spouse's Social Security benefit would be at FRA as long as that spouse has already filed.

Before 2015, it was possible for one spouse to file specifically for the spousal benefit and let their own benefit continue to grow. Now when you file for benefits, you're deemed to be filing for all benefits due you, including your own benefit, and you'll automatically get the highest amount. However, there is an exception. If you were born before January 2, 1954, have reached FRA and have not yet claimed your own benefits, you can file what's called a "restricted application" for the spousal benefit only while delaying your own benefit until age 70.

Situations and strategies to maximize benefits

Now with the basics and spousal benefit in mind, here are some general situations and strategies that could potentially increase both current and lifetime benefits for you and your spouse. Again, your decision when to file will depend on your personal situation, but you can use these as a starting point.

Situation 1: One spouse earns more than the other.

Strategy: In this situation, it can make sense for the higher earner to delay filing for benefits until age 70 while the lower earner files at FRA. Assuming good health and the prospect for a long life, this has two advantages. First, it can eventually add up to a larger lifetime benefit. And second, it can mean an increased benefit for a surviving spouse. In the meantime, the couple can still enjoy receiving the Social Security benefits of the lower-earning spouse.

Situation 2: Both partners have equivalent earnings records.

Strategy: When spouses have equivalent earnings records, it may make sense for both to delay filing until age 70. Provided that both anticipate a long life and can afford to postpone benefits, this would maximize both retirement benefits for themselves—and survivor benefits for each other.

Situation 3: One spouse qualifies to file a restricted application.

Strategy: One spouse files for benefits at FRA. At that time, the spouse born before January 2, 1954 files a restricted application, collects the spousal benefit, and switches to his or her own higher benefit at age 70. That would increase the current amount the couple receives—and provide a significant boost down the road.

Situation 4: Neither spouse qualifies for a restricted application.

Strategy: Unless one spouse qualifies for a restricted application, it's again a question of timing. If your own benefit will be higher than the spousal benefit, waiting until age 70 is generally the best optimizing strategy. If the spousal benefit is higher, hold out until your FRA if you can—but no longer. The spousal benefit, while reduced if filing early, doesn't increase if you delay beyond your FRA.

Situation 5: Only one spouse has earned income.

Strategy: Although health and anticipated longevity certainly come into play, it often makes sense for the breadwinner to postpone benefits until age 70. While the couple will forego spousal benefits until the earner files, it will allow for the largest possible retirement and survivor benefits. Other couples, however, may want the earner to file once the spouse reaches full retirement age, which is when the spousal benefit maxes out. In this case, though, they are forfeiting the highest survivor benefit as well as a higher benefit for the earner.

An advisor can help

It's easy to get mired down in the details, but don't let that stop you. Talk with your spouse about what would be best for each of you both now and in the future, run some numbers on a social security calculator, and consider consulting with an advisor who specializes in social security benefits. It may take a little effort, but the possible increase in your benefits is certainly worth it.


Have a personal finance question? Email us at Carrie cannot respond to questions directly, but your topic may be considered for a future article. For Schwab account questions and general inquiries, contact Schwab.

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