Ask Larry: Should My Wife Get A Job So She Can Get Her Own Social Security Retirement Benefit?

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Today’s column addresses questions about whether it would be worth it for a spouse to continue working so that could draw their own Social Security retirement benefit, whether working more can increase an existing benefit and survivor’s benefits after remarriage at 60. 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.

Should My Wife Get A Job So She Can Get Her Own Social Security Retirement Benefit?

Hi Larry, According to her account report from Social Security, my wife is one credit short as she has only 39 out of 40 and so she cannot get a Social Security retirement benefit on her own account. She has been a homemaker most of her life, so has not reported any taxable income for many years.

Should she get a job so that she can earn the required taxable income so that she can draw on her own account? Or can she draw on my account as my spouse?

If she draws on my account, should she wait until I start drawing in October of this year when I will reach my full requirement age or could she start drawing immediately? Thanks, Simon

Hi Simon, I’ll start by answering your second question first. Your wife couldn’t be paid spousal benefits at least until you start drawing your retirement benefits.

Your wife couldn’t collect her own benefits plus spousal benefits at the same time, so assuming that your primary insurance amount (PIA) is more than twice as much as her own potential PIA, the only thing that your wife might gain by earning a 40th quarter of Social Security coverage would be the potential for collecting retirement benefits on her own account before you start drawing your benefits. A person’s PIA is equal to their Social Security retirement benefit rate if they start drawing their benefits at full retirement age (FRA).

I would need to need to know your PIA, and your wife’s age and potential PIA to be able to tell you how much if any upside there might be to her qualifying for retirement benefits on her own account. You and your wife could use my company’s software — Maximize My Social Security or MaxiFi Planner — to run reports with different future income estimates for her so you can fully analyze your options so that you can determine the best possible 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

If I Take My Benefits Now But Keep Working, Will I Automatically Get A Rate Increase?

Hi Larry, I received a letter from SSA about taking my retirement benefits at my full retirement age of 66 and two months. If I take my benefits now but keep working and contributing, will I automatically get a rate increase in the next year? Or is it locked in? Thanks, Frank

Hi Frank, Yes, you can potentially increase your Social Security retirement benefit rate if you continue working after you claim benefits, but your benefit rate will only increase if your subsequent annual earnings are higher than one or more of the highest 35 years of wage-indexed earnings that are currently being used to calculate your benefit rate.

Social Security automatically recalculates benefit rates to include such earnings, so you shouldn’t need to do anything to receive any increases to which you’re entitled. Best, Larry

Am I Entitled To Widow’s Benefits On My Former Husband’s Record Even If I Remarried At Age 60?

Hi Larry, My husband of 43 years passed away and I remarried when I was 60. I started drawing my retirement benefit at 62 but I don’t draw much. Am I entitled to my widow’s benefit? My current husband gets a small disability check and we still make a small income. Thanks, Tasha

Hi Tasha, Yes, at least potentially. Marriages that occur after a person reaches 60 don’t bar them from being able to collect survivor benefits on the account of a deceased spouse.

However, since you’re apparently already drawing benefits on your own account, you could only qualify for additional survivor benefits if survivor rate is higher than your own benefit rate. If it is and if you haven’t yet reached your full retirement age (FRA), then it may be more advantageous for you to wait until you reach FRA to apply for survivor benefits.

That way your survivor rate wouldn’t be reduced for age. But if your former husband collected reduced Social Security retirement benefits prior to his death then your potential survivor benefit would reach its maximum rate at some point before you reach FRA. And in that case, you wouldn’t want to wait beyond then to claim any survivor benefits for which you could qualify. Best, Larry

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