Ask an Advisor: We’re 62 and 68. Can I Collect Spousal Benefits for 5 Years and Switch at FRA?


Financial advisor and columnist Jeremy Suschak

My husband began drawing his Social Security at age 62. He is 68 now (born in 1955), while I am 62 (born 1961). If I begin to draw my Social Security now it will be reduced, of course. Can I collect spousal benefits from him now and then switch to my benefit at my full retirement age (FRA) of 67? Since he began drawing early does that affect my spousal benefit amount, either now or later at my FRA?

Before covering some of the details of how spousal benefits work, I’ll answer the two questions presented at a high level. First, unfortunately, you are not able to collect spousal benefits and subsequently switch to your own benefits at full retirement age (FRA). Second, the fact that your husband began drawing his own benefits early does not affect your spousal benefit amount but early claiming on your part will. (And if you have additional questions about Social Security, consider speaking with a financial advisor.)

Changing the Basis of Social Security Benefits

As mentioned, it is not possible to switch from spousal benefits to your own benefits at your FRA. This switch is what was known as “file and suspend,” a strategy that was eliminated through The Bipartisan Budget Act of 2015. Following this piece of legislation, individuals who are eligible for their own benefits and spousal benefits must apply for both benefits through a process called “deemed filing.”

Deemed filing essentially means that if you have your own working history and file for either spousal benefits or your own benefits, then you automatically apply for both. The Social Security Administration will pay a combination of the two benefits, with the total equaling whichever benefit is higher. (A financial advisor can help you navigate deemed filing and other components of Social Security planning.)

The Impact of Drawing Social Security Benefits Early

A woman applies for Social Security benefits through the deemed filing process.

The timing of your husband’s filing will not impact your spousal benefit amount, either today or at your FRA. Individuals who are eligible for spousal benefits can receive up to 50% of the “working spouse’s” primary insurance amount (PIA). PIA is the full benefit a person is entitled to if they wait until FRA to collect Social Security benefits. In the calculation of spousal benefits, the PIA is not adjusted if the working spouse begins collecting before their own FRA.

However, spousal benefit amounts are adjusted to reflect when you — the potential collector of spousal benefits — file for Social Security. Specifically, your monthly benefit will be reduced in perpetuity for each month you begin collecting early. The current reduction factors applied to spousal benefits are 25/36 of one percent (approximately 0.7%) per month up to 36 months before FRA, and an additional 5/12 of one percent (approximately 0.42%) per month if the number of months before FRA exceeds 36.

An example using the situation in question might be helpful to illustrate how this works, though we’ll need to make some assumptions. Let’s assume your husband’s PIA is $1,500 and that you are 62 ½ years old, meaning you’d file 54 months before your FRA of 67.

In this case, your base (maximum) spousal benefit is half of $1,500, or $750. Then, the 25/36 of one percent reduction factor is applied to 36 months (36 * 25/36 = 25%) while the 5/12 of one percent reduction factor is applied to the additional 18 months for which you begin collecting in advance of your FRA (18 * 5/12 = 7.5%). This equates to an additional 32.5% reduction from your base benefit. Putting it all together, your spousal benefit would be $506.25, or 33.75% of your spouse’s PIA.

Remember, however, that if you can claim either your own benefits or spousal benefits, deemed filing will result in the SSA paying out the higher amount. Therefore, in this example, your payment will be equal to the value of your retirement benefit if it exceeds $506.25. (And if you need more help calculating your potential benefits and running comparisons like this one, consider speaking with a financial advisor.)

Evaluating Your Situation

A financial advisor can help you plan for Social Security and potentially maximize your benefits.

In assessing your situation — particularly, the timing of Social Security benefit collection — it may be helpful to look at breakeven calculations in relation to your life expectancy. The SSA publishes calculators that you can use to estimate your benefit amount at various filing ages. SmartAsset also has a Social Security calculator. You can then use these estimates in conjunction with a separate breakeven calculator, of which there are many available online.

The overall goal is to evaluate the cost/benefit tradeoff of early collection. If you expect to live well into your 80s, for example, then waiting until your FRA (or later) may make sense since it often results in larger benefit amount compared to what you might receive filing early. On a cumulative basis, this larger benefit can yield a greater lifetime payout.

However, if you don’t expect to live quite as long, it could make sense to begin collecting early, since this could result in greater lifetime collections than if you were to wait and receive a higher monthly benefit over a shorter duration. Comparing the cumulative payouts under various scenarios can show you the age at which you “break even” by waiting to begin collecting Social Security.

Another consideration to factor into your analysis is other income sources and assets you have in place beyond Social Security. If you have other sources of income, such as a pension or non-qualified assets to draw upon in retirement, then waiting to collect Social Security until your FRA could prove worthwhile given how much the benefit could increase. That benefit increase, of course, will depend on how your own PIA compares to your expected spousal benefit. (And if you need help finding an advisor to assist you in this vital planning process, consider matching with one here.)

Bottom Line

Understanding the Social Security benefit amount you are entitled to and determining when to file for benefits can be both confusing and daunting. The possibility of claiming spousal benefits can only further complicate the decision. To simplify the process, consider running some basic comparisons of your expected monthly benefit under various scenarios using publicly available tools.

Analyzing these forecasted payouts in relation to your anticipated lifespan can help you select a filing age. Lastly, and perhaps most importantly, try not to view Social Security decisions — or any other decisions related to your financial plan — in a vacuum. Rather, always seek to evaluate your options in the context of your overall financial plan, including other income sources and assets available to fund retirement. Taking a holistic approach generally leads to optimal outcomes.

Social Security Planning Tips

  • A financial advisor can help you plan for Social Security and figure out when it’s the right time to claim. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
  • If you have other assets, including retirement accounts, you may want to consider the Social Security bridge strategy. This approach calls for you to live off your retirement savings and other sources while delaying Social Security for as long as you can so you can increase your lifetime benefit. Of course, this strategy will only potentially pay off if you have enough retirement assets to support your spending before filing and expect to live past your breakeven age.
  • Get retirement planning and investing tips with the SmartMoney Minute newsletter. It’s 100% free and you can unsubscribe at any time. Sign up today.

Jeremy Suschak, CFP®, is a SmartAsset financial planning columnist who answers reader questions on personal finance topics. Got a question you’d like answered? Email AskAnAdvisor@smartasset.com and your question may be answered in a future column.

Jeremy is a financial advisor and head of business development at DBR & CO. He has been compensated for this article. Additional resources from the author can be found at dbroot.com.

Please note that Jeremy is not a participant in the SmartAdvisor Match platform, and he has been compensated for this article. Some reader-submitted questions are edited for clarity or brevity.

Photo credit: ©iStock.com/Luke Chan, ©iStock.com/Kameleon007



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