Life. Priorities
ML: What’s the rule of thumb for couples? How does being married affect the decision to claim benefits?
DL: Waiting can be even more beneficial for a couple. When a two-income couple defers collecting their primary benefits until each person is 70, they can increase their joint lifetime benefits by 22%, compared with what they’d receive if they each claimed their benefits at 62.
Then there’s the spousal benefit to consider, which can be especially useful if one spouse has higher lifetime earnings. Here’s a strategy that many couples could implement, though not everyone is aware of it: The higher earner—let’s say it’s the wife—files for Social Security at age 66. She then immediately suspends payments, allowing her husband—let’s say he’s also 66 and has reached his full retirement age—to begin collecting the spousal benefit. This benefit would amount to 50% his wife’s full benefit.
Having that extra income to supplement the household budget allows the wife to comfortably delay taking her benefit until she reaches 70. When she refiles, or “unsuspends,” her claim at that age, she’ll receive her maximum benefit. Her husband can continue to receive his spousal benefit based on her earnings—or file for his own increased benefit, whichever is higher. Under certain conditions, the spousal benefit even applies to divorced couples.
