Planning to Claim Spousal Social Security Benefits? 3 Surprising Rules You Must Know First.

If you don’t understand the rules, you could wind up sacrificing some of the benefits you’re entitled to.

Social Security is the cornerstone of many Americans’ retirement finances. The income it provides can be the difference between being able to enjoy your golden years and not having enough money to make ends meet.

For some, the program’s spousal benefits option can significantly boost a household’s Social Security income. Those benefits can be worth up to half of the higher-earning spouse’s full retirement benefit. But the rules regarding this benefit for low- or non-earning spouses can make calculating when each member of a couple should claim Social Security a lot more complicated.

If you’re considering claiming spousal benefits in retirement, you need to know the following three rules — some of which may surprise you.

A senior couple smiling at each other while drinking from mugs outdoors.

Image source: Getty Images.

1. Spousal benefits are only available to you if your spouse is also taking their benefits

You can’t claim spousal benefits until your spouse has applied for benefits on their own earnings record. That can make planning when to claim benefits more difficult for couples who are around the same age or when the lower-earning spouse is older.

For example, as a couple, you may want to have the higher-earning spouse postpone claiming their benefits until they turn 70, which will maximize their monthly benefits and the benefits the surviving spouse will receive. However, that could come at the cost of the lower-earning spouse receiving lower benefits (or possibly no benefits at all) for a long time beforehand.

The good news is the Social Security Administration offers everyone estimates of what their benefits will be in retirement. You can use that data to see how various claiming strategies would impact your household income and revise your plans accordingly. Sitting down with a financial planner could help you determine the best claiming strategy for you and your spouse.

2. You don’t get any extra spousal benefits for delaying past full retirement age

You may already know you can maximize your personal retirement benefit by waiting until age 70 to claim it. That’s because the Social Security Administration offers delayed retirement credits for each month you postpone taking benefits beyond your full retirement age.

But that only applies to your personal benefit. Spousal benefits don’t receive any delayed retirement credits, so they max out when the beneficiary reaches full retirement age.

With that in mind, the maximum possible spousal benefit is equal to 50% of your spouse’s primary insurance amount, or PIA, which is the amount they’re entitled to at full retirement age.

What the government defines as your full retirement age depends on when you were born. Those born in 1954 or earlier reached full retirement age at 66. But the full retirement age has increased by two months for each year someone was born after 1954 until topping out at 70 for those born in 1960 or later. That means anyone born in 1957 or earlier has already reached full retirement age.

If you’re planning to take spousal Social Security benefits, it rarely makes sense to delay applying for them beyond your full retirement age. Even if you won’t be eligible for spousal benefits until your spouse applies, you can still receive the benefits you are entitled to based on your own work history while you wait.

3. There’s a steeper penalty for claiming spousal benefits early

You can claim Social Security retirement benefits as early as 62 in most cases, but the government reduces the size of your monthly checks if you claim before reaching full retirement age. The reductions for claiming spousal benefits early are even steeper than those for claiming your personal benefit early. The only exception is if you’re caring for a qualifying child (one who is 16 or younger or a child on disability benefits) of your spouse’s.

The following table shows how claiming early would impact personal and spousal benefits for someone with a full retirement age of 67.

Age When Claiming Percentage of Personal PIA Percentage of Spouse’s PIA
62 70% 32.5%
63 75% 35%
64 80% 37.5%
65 86.7% 41.7%
66 93.3% 45.8%
67 100% 50%

Data source: Social Security Administration. Calculations by author.

For each month before your full retirement age that you claim your spousal benefit, that benefit is reduced by 25/36 of a percentage point (about 0.69%) for up to 36 months. By comparison, your personal benefit only gets reduced by 5/9 of a percentage point (about 0.56%) for the first 36 months. Both are reduced by an additional 5/12 of a percentage point (about 0.42%) per month beyond 36 months.

While each person’s individual situation will be unique, most retirees would maximize their monthly household income in retirement by delaying their Social Security applications for as long as doing so increases their benefits. That’s until full retirement age for those planning to take spousal benefits and until 70 for the higher-earning spouse.

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