16 Jul How can my wife get the highest Social Security benefit?

Q. I will turn 62 in May of 2020 and my wife will turn 62 in September of 2024. Her Social Security benefits are slightly higher than half of mine. I have been retired since 2014 and will begin receiving benefits next spring. She will continue working until she reaches 62. Can she begin drawing half of my benefit amount when she turns 62 and let her own benefits continue to increase and switch to draw her own benefits when she reaches full retirement age?
— Husband

A. Optimizing Social Security benefits can be complicated.

Here’s what you need to know.

Your wife would be able to claim spousal benefits at age 62, which is the earliest age for claiming, said Jody D’Agostini, a certified financial planner with AXA Advisors/The Falcon Financial Group in Morristown.

She said the requirements are that you were married for at least a year, and that you, as the other spouse, have already filed. This would allow her benefit to grow.

“This might make sense if she does in fact retire,” D’Agostini said. “If not, the Social Security benefit could be reduced as it is subject to an earnings limit.”

For 2019, if you earn more than $17,640 per year, Social Security will withhold $1 for every $2 of earnings above this limit, she said.

D’Agostini said it appears that your wife was born after Jan. 1, 1954, which means that she is entitled to the greater of her reduced Social Security benefit or one half of yours.

If your wife was born before that date, she could file a restricted benefit application for the spousal benefit, she said. This allows her to continue to earn delayed retirement credits based on her earnings history.

“The increase would be 7 to 8 percent per year until the age of 70,” she said. “It can increase the monthly benefit by as much as 76 percent between the ages of 62 and 70 depending upon her age.”

Because your wife has the higher benefit, it makes sense to delay taking her benefit as long as it is possible to maximize the family Social Security benefit, D’Agostini said.

“If your wife were to predecease you, you could step up to her higher benefit,” she said. “The widower benefit is 100 percent of the deceased benefit.”

It’s smart to have a conversation with a local Social Security office to confirm the numbers and run projections based on both of your earnings histories.

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This story was originally published on July 16, 2019.

NJMoneyHelp.com presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.