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Old 04-05-2015, 07:20 AM
 
87 posts, read 48,943 times
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Good morning. I am looking to maximize our SS benefits when the time comes to collect. I am 60 and my wife is 64. Her benefit should be $570 at FRA. I plan to work till 66 or 67 and my benefit should be around $2400 a month. My question is if she takes her $570 at her FRA can I take spousal benefits at 62 and then when I reach FRA switch to my benefit and my wife switches to spousal benefits? Also if we do the first part will it affect the amount we collect on the second part?

Thanks for the help.
Ivan
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Old 04-05-2015, 08:16 AM
 
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no , spousal benefits are not an option if you have your own work record and are below your fra.

pre fra you can only get your own benefit and that stays with you forever. it isn't until you reach full retirement ge that true spousal bemefits become an option you can chose from.

at best she can get 1/2 your full rate when you file or do a file and suspend . one other choice would be at your fra to file for 1/2 hers using selective application and leave yours to grow to 70 but rarely does that work out as well as file and suspend . but in any case you have zero opitions before your own fra.
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Old 04-05-2015, 08:43 AM
 
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Thanks for the quick reply.

One more quick question. She can take her full benefit of $570 at her FRA and then switch to spousal benefits when I retire I assume ?

Thanks
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Old 04-05-2015, 08:52 AM
 
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no , once you file before fra you never can switch benefits except survivor.

what happens is when you file they will take 1/2 your full benefit and subtract what her full would have been if she didn't file early. that difference is then added to her early benefit.

if she filed early it will always be less than 1/2 your full the way it works.

i will make up some numbers as an examples.

lets say her full would have been 10,000 a year . your full is 28,000 .

so 1/2 of yours is 14,000 less her full of 10,000 which is 4000.

they will add 4k a year to her early benefit or 333 a month bringing her to 570 + 333 = 903.00


had she waited instead of filing early she would have gotten 1/2 your full or 1200 a month.

Last edited by mathjak107; 04-05-2015 at 09:01 AM..
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Old 04-05-2015, 09:43 AM
 
Location: Mount Airy, Maryland
10,478 posts, read 5,941,871 times
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He was asking is she waited until her FRA before filing on her own can she then switch over to 1/2 of his at his FRA. He said nothing about her filing early.
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Old 04-05-2015, 10:15 AM
 
71,779 posts, read 71,896,917 times
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Quote:
Originally Posted by Im45us View Post
. My question is if she takes her $570 at her FRA can I take spousal benefits at 62 and then when I reach FRA switch to my benefit and my wife switches to spousal benefits? Also if we do the first part will it affect the amount we collect on the second part?

Thanks for the help.
Ivan

Quote:
Originally Posted by Im45us View Post
Thanks for the quick reply.*




One more quick question. She can take her full benefit of $570 at her FRA and then switch to spousal benefits when I retire I assume ?*




Thanks


there were two questions , but yes i did read one wrong .

so yes as long as she is fra she can get her own and then get 1/2 yours instead when you file.
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Old 04-05-2015, 12:50 PM
 
Location: Cape Elizabeth
425 posts, read 388,445 times
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Default Another scenario

Quote:
Originally Posted by Im45us View Post
Good morning. I am looking to maximize our SS benefits when the time comes to collect. I am 60 and my wife is 64. Her benefit should be $570 at FRA. I plan to work till 66 or 67 and my benefit should be around $2400 a month. My question is if she takes her $570 at her FRA can I take spousal benefits at 62 and then when I reach FRA switch to my benefit and my wife switches to spousal benefits? Also if we do the first part will it affect the amount we collect on the second part?

Thanks for the help.
Ivan
Based on my 35 years working for SSA and helping people like you and your wife, I have a question and a hunch: Is your wife working now and earning above the $15720.00 allowed in 2015? I have a hunch she is not, because her own retirement is so low, she has many zeroes in the computation. She probably worked earlier in life...but of course I could be wrong.

But, if I am right, if she is sitting home, not working and not collecting, why don't you consider having her apply for reduced retirement. You said she is 64. Her FRA is 66. Yours is 66 + 2 months. At 64 her reduction factor is 24 months (if she is really 64 + 3 months etc, her reduction factor is even less.). So, for purposes of this example, lets use 24 months. She would receive a $76.00 a month reduction on the $570.00. That is her loss. But, what does she gain? She gains $494.00 for 24 months. That is $11856.00. You divide the gain by the loss to see how long it takes her to make up the $11856.00 she could have had. It takes her 13 years beginning at age 66 to just break even.

And, in her case, when you begin to collect say, if you retire at FRA and you get $2400.00 a month (if that was your full retirement amount, your wife, begins to collect as your spouse. Take the $2400, divide it in half- $1200.00. Subtract her $570.00. That leaves $630.00. It doesn't have to be reduced because she is already 66. The $630.00 gets added to her $494.00 so her total when you begin to collect is $1124.00. You get your $2400 and she gets $1124.00.

Now, because your wife is due an additional $630.00 on your record, there is an incentive for you to collect. Because you must collect for her to get the additional $630.00. So, in the year you turn 66 + 2 months, you might want to consider applying in January of that year. I posted a long scenario about that for someone else that you might want to find.

So, in closing, does that $76.00 per month make a difference in your lifestyle? The $11856.00 might, especially if you save or invest it (because you weren't even expecting it). I hope you find this helpful. I am not trying to persuade anyone of anything. Just help people the way we always used to help people when the government actually hired, trained and allowed the public to be helped.
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Old 04-05-2015, 12:54 PM
 
71,779 posts, read 71,896,917 times
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thats what we are doing . my wife is collecting since she is 62 , i may take mine at 63 , no point waiting to 66 when i run the numbers, and then she will get a kicker added to hers.

we would need to lay so much out of investments if we delay that the lost gains and lost checks may just cancel each other out . the higher tax bracket on the extra ss when combined with rmd's would be another negative of delaying in our case.
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Old 04-05-2015, 02:04 PM
 
30,165 posts, read 47,394,029 times
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That is why we think drawing my spousal on my husband's and he drawing his is better for us than my drawing spousal on his file and suspend and his waiting until 70--
Taxes are our bane and waiting until RMDs start doesn't really help us.
I was FRA this past August and he was FRA/66 in Dec...
I won't ever want to draw my work benefit because of the government offset of my teacher pension which is larger than my SS

What works for some people isn't the answer for everyone.
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Old 04-05-2015, 02:29 PM
 
Location: Cape Elizabeth
425 posts, read 388,445 times
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Quote:
Originally Posted by loves2read View Post
That is why we think drawing my spousal on my husband's and he drawing his is better for us than my drawing spousal on his file and suspend and his waiting until 70--
Taxes are our bane and waiting until RMDs start doesn't really help us.
I was FRA this past August and he was FRA/66 in Dec...
I won't ever want to draw my work benefit because of the government offset of my teacher pension which is larger than my SS

What works for some people isn't the answer for everyone.
loves2read- I hate to be the bearer of bad news but your spousal benefit appears to be subject to the Government Pension Offset. Your own SS, if you have your 40 quarters (outside of the teacher work, where it seems you did not pay into SS) might be subject to the Windfall Elimination Provision, not the GPO.

Now, there are plenty of teachers, in plenty of states who are not subject to those provisions, because their teacher work was covered by SSA. But, If you receive a pension from a federal, state or local government based on work where you did not pay Social Security taxes, your Social Security spouse’s or widow’s or widower’s benefits may be reduced. Two thirds of your non covered pension (unless you meet one of the exceptions) must be subtracted from any spousal or survivor SSA benefit.

The WEP, on your own, is at most a 40% reduction in your FRA amount. It might be all you are due - that is if 2/3 of your own pension wipe out anything you are due as his spouse.

Please read up on GPO and WEP on ssa.gov. The maybe good news is, since you are past FRA, and if you are only due a WEP'd retirement, you can go retroactive 6 months.

Please let me know if I am not understanding something about your situation.
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