Ask Larry: Will My Wife’s Early Spousal Benefit Be Half My Retirement Benefit At 62?

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Today’s column addresses questions about spousal benefit amounts when both spouses file at 62, taking retroactive retirement benefits before larger spousal benefits and when divorced spousal benefits might be available. Larry Kotlikoff is a Professor of Economics at Boston University and the founder and president of Economic Security Planning, Inc, which markets Maximize My Social Security and MaxiFi Planner.

See more Ask Larry answers here.

Have Social Security questions of your own you’d like answered? Ask Larry about Social Security here.


Would My Wife’s Spousal Benefit Equal 50% Of My Social Security Retirement Benefit At 62?

Hey Larry, My wife and I were in the very fortunate position to retire early last year. Both of us have earned enough credits to qualify for Social Security benefits. If my wife begins receiving her retirement benefit at 62 later in 2021, would she be eligible to file to collect the difference between her monthly retirement benefit and 50% of the retirement benefit I will receive at age in 2022? My benefit payment at 62 is approximately three times the amount my wife would receive. Thanks, Evan

Hi Evan, That’s not exactly it. When your wife files for her retirement benefits, she’ll be deemed to be filing for both her Social Security retirement benefits and her spousal benefits. She wouldn’t be able to actually collect spousal benefits until you start drawing your retirement benefits though. If you file for your retirement benefits after your wife files for her benefits, she couldn’t switch from her own benefits to a spousal benefit, but she could file for an excess spousal benefit.

Her unreduced excess spousal benefit would be equal to 50% of your primary insurance amount (PIA), which is equal to your full retirement age (FRA) retirement benefit amount minus 100% of her PIA. However, if she takes her spousal benefit before her FRA, it will be reduced below this amount. Her retirement benefit was also reduced for filing early and this reduction persists even after she files for her reduced excess spousal benefit.

One thing you need to be aware is that if you die before your wife, her maximum survivor rate would be equal to the higher of your benefit rate, or 82.5% of your PIA.

So if you file for your benefits at 62, you will not only be reducing your monthly benefit rate but also the survivor rate that your wife could potentially receive. You and your wife may want to consider using my company’s software — Maximize My Social Security or MaxiFi Planner — to fully analyze the options available to you in order to determine your best strategy for maximizing your benefits. Social Security calculators provided by other companies or non-profits may provide proper suggestions if they were built with extreme care. Best, Larry


Am I Understanding The Spousal Benefit Correctly?

Hi Larry, Am I understanding the spousal benefit correctly? There’s so much conflicting information.

My husband and I are both 67, and reached full retirement age in 2020. He is the higher earner, and will delay filing for Social Security until 70. I’m eligible for a spousal benefit of $1,505.50. This will break down into my own retirement benefit of $1,000, plus an excess spousal benefit of $505.50.

If I claim my own retirement benefits now, I will receive $1,000 but the excess spousal benefit would be delayed until my husband starts his benefits in three years, right? Will it automatically be added or will I need to file?

Are there any pitfalls I’m missing? Thanks, Robyn

Hi Robyn, Yes, you apparently understand spousal benefits correctly, but if you haven’t already applied for your retirement benefits it sounds like you might want to do so immediately.

Any spousal benefits you eventually collect will be calculated by subtracting the higher of your primary insurance amount (PIA), or your PIA augmented by delayed retirement credits (DRC), from 50% of your husband’s PIA. A person’s PIA is equal to their Social Security retirement benefit rate if they start drawing their benefits at full retirement age (FRA).

So if half of your husband’s PIA is more than you could draw on your own record even if you waited until 70 to start drawing, then you would ideally want to start drawing your own benefits no later than at your full retirement age (FRA).

You can claim your own benefits up to six months retroactively, and based on the information in your question you may want to apply for your benefits now and claim the full six months of retroactive benefits. You will also have to file a separate application for spousal benefits when your husband applies for his retirement benefits. Best, Larry


Can My Mother Still Look At Getting A Divorced Spousal Benefit?

Hi Larry, My mother retired and moved here to GA at 66. She was married for 30 years but divorced. Can she be eligible for divorced spousal benefits? He lives in Indiana. Thanks, Frank

Hi Frank, The states in which your mother and her ex-spouse live wouldn’t be an issue, but whether or not she could qualify for divorced spousal benefits likely depends on the relative amounts of her and her ex’s benefit rates.

If your mother’s ex is still living and assuming that your mother is already drawing her retirement benefits, she could only qualify for divorced spousal benefits if her primary insurance amount (PIA) is less than 50% of her ex’s PIA. A person’s PIA is equal to their Social Security retirement benefit rate if they start drawing their benefits at full retirement age (FRA).

She could also potentially qualify for survivor benefits if her ex’s benefit rate or his PIA is more than your mother’s PIA. In any case, it certainly wouldn’t hurt for your mother to check with Social Security to see if she might qualify for benefits on her ex’s record. Best, Larry


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