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How couples can get the most from Social Security

Knowing how and when to claim can make a huge difference in lifetime payouts. Therefore, mistakes come at a painfully high price.

By MSN Smart Spending editor Sep 6, 2013 11:42AM
This post comes from Lucy Lazarony at partner site

MoneyRates logoWhen deciding how you and your spouse should approach Social Security retirement benefits, there are a lot of approaches to consider. Unfortunately, many of them can result in you getting significantly less than what's available to you.

Mature couple calculating expenses © Abel Mitja Varela, the Agency Collection, Getty Images"It's like a game of chess," says Mari Adam, a certified financial planner based in Boca Raton, Fla.

Each decision you make as a couple can impact the monthly Social Security benefits you receive for the rest of your lives. Consequently, even small missteps can shave thousands from the cumulative benefits you receive as a couple.

To prevent you and your partner from getting short-changed, consider these five tips for helping married couples maximize their Social Security benefits.

1. Understand the impact of timing

Whether you're single or married, deciding when to start your benefits is critical. But when a couple makes a bad timing decision together, the losses are compounded. This makes it especially important for couples to grasp the basics.

"If you start early, you get less on a monthly basis. If you wait longer, you get more on a monthly basis," says Kurt Czarnowski, who worked for Social Security Administration for 34 years and is now principal at Czarnowski Consulting, a retirement planning company.

You can choose to start collecting Social Security benefits early (starting at age 62), but your benefits will be permanently reduced from what you would have received if you waited until your full retirement age (age 66 for people born from 1943 to 1954). Claiming benefits at 62 means your monthly benefit is likely to be about 25% less than what you would have received at your full retirement age, Czarnowski says.

Conversely, if you wait past your full retirement age to collect your benefits, your future monthly payout will increase by up to 8% each year until you turn 70.

2. Wait at least until full retirement age to claim benefits

Simply waiting until full retirement age to claim benefits can have a significant impact on a couple's finances over the course of their lives, says Josh Koehnen, a certified financial planner in San Diego.

"Assuming health is good, married couples should hold off until at least full retirement age (66 or 67) before taking any benefits," Koehnen says. "Taking it before this time will result in a permanent reduction that could mean missing out on significant dollars, depending on how long they live. I recently ran an analysis for a client, which showed that if they both waited until full retirement age and ultimately lived until age 85, they would receive over $150,000 in additional benefits."

For healthy couples who would like to maximize their lifetime payout, Koehnen recommends delaying the collection of benefits -- with the exception of Social Security spouse's benefits, as you'll read below -- until age 70 if possible.

3. Delay Social Security benefits for the higher earner

If one spouse was the major breadwinner for the couple, that spouse may want to delay receiving monthly retirement benefits from Social Security longer than their partner. Doing so can help guarantee that the surviving spouse will collect as large a benefit as possible when the other dies.

"The spouse with the higher monthly benefit should postpone collecting Social Security as long as possible, but not beyond the age of 70," says Michelle Tucker, a certified financial planner at Tucker Wealth Management in Honolulu. "The object of postponing is to maximize your benefit and this higher benefit will be paid to you for life and continue for the life of your surviving spouse."

4. Consider a file-and-suspend approach . . .

Using a file-and-suspend strategy is one way couples can reap an oft-overlooked perk: Social Security spouse's benefits.

For example, if both spouses are eligible for benefits and one opts to file and suspend while the other doesn’t file at all, it allows the nonfiling spouse to claim a spouse's benefit as both of them continue to let their regular benefits grow. If the couple intended to delay collecting anyway, this monthly spouse's benefit effectively equals free money.

"A client recently used this strategy where the husband decided to file and suspend his benefit at age 66 so that the wife could take a spousal benefit until they both begin taking their own benefits at age 70," Koehnen says. "She is now getting about $1,100 per month for the next four years, which will result in over $55,000 of additional funds."

5. . . . or a file-and-restrict strategy

A strategy similar to file-and-suspend is called file-and-restrict. This approach also bring spouse's benefits into the mix, but unlike file-and-suspend, one of the spouses must be collecting his or her regular benefits in this scenario.

"If you are 66 and your spouse is collecting Social Security based on her earnings history, you can file and restrict your application and qualify for your spousal benefit based on her earnings history," Tucker says. "By doing this, you will collect a spousal benefit while you postpone collecting your own benefit, which continues to grow."

Then, when your regular benefit has grown to a level that satisfies you, you can withdraw your restriction and begin collecting that amplified benefit for the rest of your life.

More from

Sep 6, 2013 1:45PM
I wished the government would quit putting out these articles.  Any financial planner will tell you, you have to live to be 80 to see the difference between taking SS at 62 versus 65.  SS just does not want you to take it at 62 because then there will not be enough for people who are drawing SS disability illegally and there are a lot of those scum bags out there.  I have heard on several occasions of people have a business while collecting SS disability to boot.  The government is to lazy to go after these people as they are to busy sitting around playing poker on their phones instead of dealing with the real issues. 
Sep 6, 2013 1:49PM
Delay, delay, delay until you drop dead and we don't have to pay you a dime. Just give me all the money I paid in and stop taking it out of my check every payday and get me out of this government Ponzi.... 
Sep 6, 2013 2:18PM

I am retiring in Jan at age 64 and for one am not going to wait to get my money....wife is doing the ame thing...we are done and going to start taking it. No waiting....may not be there when we need it.


Sorry - for those coming behind us....but I have been paying in since 1966 and plan on getting mine before it is all gone.+

Sep 6, 2013 2:12PM
I am very tired of these articles suggesting that people wait to take their benefits.  Take them when you are ready and able to retire.
Sep 6, 2013 1:58PM
One thing you can count on, these so-called experts are always wrong. Do the math, you'll get just as much money if you take it early then if you wait.
Sep 6, 2013 2:47PM

After much calculating I began collecting my SS at 62 with the idea of having the full amount I receive each month transferred from my bank to several direct investment stock accounts.

I chose stocks with a long record of paying better than average dividends along with capital appreciation, and chose to have our dividends re-invested.

To date the amount we receive in dividends surpasses the difference we would have received if we waited to collect SS at full retirement with the added benefit of having a lump sum available if needed.

I realize this option is not available to everyone but it definitely can be a beneficial alternative to waiting until full retirement age.

Sep 6, 2013 2:40PM
 Take the benefit ASAP.... do the math, and remember, you have to be alive, to collect the benefit.
Sep 6, 2013 2:13PM

Does the expert figure the dollars used in the difference between benefits at age 66 vs age 62?

Each year adds a devaluation of that dollar.  What about the case of two wage earners who earned about the same during their lifetimes?  In our case the break even point was 79.  My life expectancy

is about 86.  Seven more years and the quality of life is different towards the end of that time.  I won't be doing as much between 79 and 86 like I am between 62 and 66!  Even so, has anyone ever figured out what the actual payback should be based on 45 years of paying in?  What about the poor slob who dies before cashing in on SSAN or at the beginning of the payout and he worked all his/her life and has no dependents? What happens to all that money?

Sep 6, 2013 3:03PM
I have a relative that just turned 66, is working full time and has a state retirement program.  He has a children 5 and 11.  He was told by his financial advisor to start taking SS now and also since he has children under 18, he would get benefits for both of them to at half of his monthly SS rate (i.e. example say he gets $1500, then the children would get $750 each monthly).  So, the SS program is supporting his children and himself, then on top of that he has a good job that pays well, including retirement benefits when he finally decides to retire. He did not know that SS would pay benefits to his children, but is glad to take the money.  I just wonder why SS wants to provide benefits for retirees that have children under 18 years of age and especially for those that have the resources already for their care.  Oh by the way, his wife also has a good job and a state retirement program.  It seems to me that no one in this scenario should get maintenance for their children. 
Sep 6, 2013 3:24PM
When someone can guarantee me in writing that I will live up to 66 to collect my social security benefits then I'll wait 'til I'm 66, but, in the mean time I'll start collecting while I'm still alive.
Sep 6, 2013 3:12PM
!993 house across a street a philipino woman psychiatrist without green card moved in. She married an american household servant in few months. Since 1993 He has been collecting social security disability for over 20 years and still continues. She signs her papers to show he is diable. This man works 24 hours machine non stop almost daily. Some of his routine work now a days Fix all 3 cars meaning engine change brakes tires exhaust and all in drive way, take kid to school am and pick her up pm, go mcdonald get breakfast, lunch , dinners  daily ,prepare and do complete parties 10 times a year for 50 philipinos, go post office pick up mail, go bank deposit checks, The man works like a maniac 24 hous non stop , take care of 2 dogs, cut grass, repair things in home , make new fence, put new pool, and million other chores with collecting disability from our paychecks and laugh at idiot us government daily in small town in OHIO. Nobody does anything eventho we filed compalint with soc sec 10 times. BTW there are 10 millions who came in this country since they had no money, never contributed a dime in soc sec system collecting SSI and fight in church why she got 1200 and I got 1142 dollars per month free money . I am seeing this for 40 years and it still goes on. This legal immigrant older people are cancer to us laws but government pay them to travel 3 times a year to go asia and come back free at our expenses . I have put money in soc sec system for 42 years and still have to wait 4 more years to see one penny of my contributions. THIS IS REAL USA...

This article gives examples for "healthy old people"!!!


How many healthy old people do you know? Very few, so this article applies to them only!

I got laid off at 61, I took unemployment for two years while I did my best to re-qualify and get a job, but then I had no choice but take SS at about 63. MY wife does not qualify for SS and she will have to wait 4 more years to collect half of my SS. I lost a lot by taking it early and my wife would take less for that.

Then I got cancer... I have friends with stroke and some other "unexpected" medical problem. So, this article suggests...

Oh, my 401k disappeared in the market crash! bad timing and got screw allover

Sep 6, 2013 3:11PM
If there is still social security left when I turn 62, I am taking it while I can.  I can invest the money or whatever, but it will be better off in my hands than in the governments hands.  They want to you wait and then they hope you will die before claiming it.
Sep 6, 2013 3:06PM
I ran the math, the break even point is age 76. Assuming 4% increase per year, the difference at 80 is only about 5%, or 9% at 85.

Assuming $1500 at 65
Age  Start 65   Start 62  Difference
65  $    18,000.00  $    57,327.00  $   39,327.00
76  $  270,464.00  $  270,318.00  $       (146.00)
80  $  392,842.00  $  373,562.00  $ (19,280.00)
85  $  575,466.00  $  527,615.00  $ (47,851.00)

If you live up to 85, that $48K is some change, but it took 20 years to see the effect. Not very convincing.
Sep 6, 2013 4:01PM
Are you kidding me?? Wait no longer than the minute I turn 62.  My parents both died young, 56 and 59 and paid into social security all their lives.
Sep 6, 2013 2:00PM
The strategy does not work if one of the couple retired from Education.  They do not get survivor benefits.  Additionally, if you are retired and do not take SS, then you need to take money out of other sources.  Everyone situation is different and no one set of rules or guidelines work for everyone.
Sep 6, 2013 3:47PM
For a married couple the only important fact in this article was "if you are both in good health."  My husband and I both elected to take our SS at 62, if something happens to him, I get his SS and lose mine.  And after working all those years I was definitely going to draw on my SS when I could.
Sep 6, 2013 5:19PM
A good friend of mine did just that 2 months ago he told me he was about ready to retire.  He died this week he was 66.  Boy it sure did him good waiting to 65.  You just cannot trust the Government any longer to tell the truth!
Sep 6, 2013 4:37PM
I'm taking mine at 62 I don't care what anyone says.....I've seen too many people apply for it and either only collect for a short period or not collect at all due to the fact that they die.....I'm taking the money I put into the system, since where does my money go if I don't ever collect it???   There shouldn't be a shortage for SS, many people have never collected it....
Sep 6, 2013 4:17PM
PUT CONGRESS ON THE SAME RETIREMENT PLAN... then maybe I'll consider not retiring early.
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