Social Security Benefit for Spouses
Let’s look at an example; Margaret just turned 62 and her husband is
64. Margaret has not worked for the past 10 years and worked 20 of the last
35 years. If she retires now, she’s entitled to a monthly payment of
$400 (after the 25 percent reduction for retirement at the age of sixty-two).
When Margaret’s husband retires at the age of sixty-six, in 2 years,
his monthly Social Security benefit will be $1,350. Margaret could claim her
social security today and receive her $400 per month, based on her own earnings.
Then when her husband retires, she could receive a benefit based on his work
record. This will come to $472.50, or 35% of her husband’s benefit (see
prior table). You may have heard that spouses get 50% of the higher-earning
spouses benefit—but that’s ONLY if they wait until their own full
retirement age to start collecting benefits.
Decisions for Spouses
Start
my own benefits at age 62 |
You
can take reduced benefits on your wage record before full retirement
age. If you do, your benefit will always be reduced--even if you take
reduced benefits on your own record and then take spouses benefits
when the higher earning spouse retires (see previous table showing
reduction in spousal benefits). |
Start
my own benefits at full retirement age |
If
you are the higher earning spouse, you always will quality for benefits
under your own earnings record and then the decision is when to start
benefits as discussed in the previous section |
Start
benefits at age 62 based on my spouses social security earnings |
You
cannot receive spouse's benefits until your spouse files for retirement. If
you choose to receive a reduced benefit before full retirement age,
you are not entitled to the full spouse's benefit rate upon reaching
full retirement age. A reduced benefit rate is payable for as long
as you remain entitled to spouse's benefits. |
Start
benefits at full retirement age based on my spouses social
security earnings |
If
you stopped working for several years or had low earnings, the spouse's
benefit may be higher. At full retirement age, a spouse receives 50
percent of what the higher-earning spouse is entitled to at full retirement
age. At death of the higher earning spouse, you receive that deceased
spouse's full benefit |
Unfortunately, the federal govenrment likely taxes your social security income
and our next article explains how to reduce or eliminate tax on social security
income:
Social
Security Taxes - How to Reduce Taxation of Your Benefits
|
