How Married Couples Can Maximize Social Security Benefits

On April 29, 2016, a law went into effect that won't allow a spouse to begin receiving benefits until the worker is actually receiving benefits, too. Workers can still file and suspend, but spouses (or other dependents, including minor and disabled children) can't receive benefits during the suspension.  

Are you married, with one spouse wanting to retire but the other one prepared to keep working? If so, you should take a close look at the "file and suspend" strategy to maximize your Social Security benefits.

Spousal Benefits

Spouses are entitled to Social Security benefits on their husband or wife's work record, provided the marriage lasted at least 10 years. If the spouse who is not working or who wants to stop working is at full retirement age or caring for a child under 16 years old, they are entitled to an amount equal to one-half of the working spouse’s full retirement benefit. If the non-working spouse takes the working spouse's benefits before their own full retirement age, the amount received will be reduced.

File and Suspend Strategy for the Working Spouse

In order to receive the spousal benefit, the working spouse must have filed for Social Security retirement benefits. However, the working spouse can continue working using the file and suspend strategy, which can be used as long as the worker has reached full retirement age (age 66 for those born between 1943 and 1954).   

It works this way: the working spouse files for benefits and then immediately suspends them. Once the worker suspends benefits, the non-working spouse can begin receiving spousal benefits while the worker continues to work. The longer the worker delays retirement, the more delayed retirement credits they will accumulate. Social Security benefits can increase by as much as 8 percent a year (depending on date of birth) if a worker delays retirement beyond full retirement age. 

Example: Husband and wife are at full retirement age. The wife wants to start collecting benefits, and the husband wants to continue working. If the husband retired now, he would receive $2,000 a month. He files for benefits and immediately suspends. The wife files for spousal benefits. She receives $1,000 a month on his work record. The husband continues to work and retires at age 70. When he retires, he can get as much as $2,800 a month in benefits.

This strategy can work either if you, as the non-working spouse, are retiring early or if you are retiring at your full retirement age, but for it to be to your advantage you must receive lower benefits on your own record than on your spouse's record. If you retire before your full retirement age, Social Security will automatically give you the higher benefit--your own or the spousal benefit. If your own benefits are higher and those are what you receive, you won't continue to build up delayed retirement credits. If you retire at full retirement age, you can choose which benefit to take. This allows you to take a spousal benefit while your worker's benefit accrues delayed retirement credits.

Example: A husband and wife are both at full retirement age. The husband's benefit is $2,000 a month. The wife would receive $900 a month in benefits if she received benefits on her own work record. The husband files and suspends. The wife receives $1,000 a month of spousal benefits on the husband's work record. At 70, the wife can claim on her own record, which, because of delayed retirement credits, will have grown to more than $1,000 a month.

More Resources

While it may sound complicated to file for worker benefits, apply for spousal benefits, and then suspend worker benefits, it can be done in one visit to your Social Security office. Learn more about suspending benefits.

Get more information about Social Security benefits.

This isn't the best strategy for everyone. To find out if it will work for you, contact an elder law attorney near you.