Question: I was wondering if I could take my Social Security now at 64 and then at 66 switch over to my husband's. We were married for 20 years and he never was able to collect on his. What would be the filing times if I could?
Answer: Are you married, divorced or widowed? It makes a big difference, says Mike O'Connor of Economic Security Planning, which developed and sells the Maximize My Social Security software program.
If you are currently married to, or divorced from, this husband -- and since filing for your retirement benefit at age 62 is before your full retirement age (FRA), it depends on whether you are eligible for spouse's/divorced spouse's benefits at that time, says O'Connor.
"If so, you will be deemed to have filed for both retirement and spouse's/divorced spouse's benefits at that time, i.e. you can't file a restricted application for just retirement benefits and delay your spouse's/divorced spouse's benefits until age 66," he said.
If you become eligible for spouse's/divorced spouse's benefits after you file for your retirement benefits, but before your FRA, then you will be deemed to have filed for both retirement and spouse's/divorced spouse's benefits at that time of dual eligibility, said O'Connor.
"If widowed, then yes you can file for retirement benefits now and switch to widow's benefits at your FRA," he said. "However, depending on your husband's age when he died there may be better alternatives based on the RIB-LIM." One way to determine your best filing strategy is to use a Social Security calculator such as MaximizeMySocialSecurity.
The Bipartisan Budget Act of 2015 included significant changes to Social Security's rules. According to O'Connor, the new rules dramatically change Social Security claiming options and effectively divide each individual into one of three groups:
People born on or before May 1, 1950 will be the least affected, although if they plan to suspend their retirement benefit in the future, they must request to do so before April 29, 2016. Those born on or before May 1, 1950 who will have requested suspension by April 29 will still receive auxiliary benefits, i.e. spousal and child benefits, during suspension.
People born between May 2, 1950 and January 1, 1954 will see mixed effects of the new rules on their optimal benefits filing strategy.
People born on or after January 2, 1954 will be the most affected in terms of the effects of filing and suspending as well as not being able to file a restricted application for either just a spousal benefit or just a retirement benefit even after their full retirement age. They will not receive auxiliary benefits during suspension.
O'Connor said individuals in groups two and three, as well as married couples with at least one spouse in group two or three, should recalculate their maximized strategy to reflect the new rules.
According to O'Connor, this is how the new rules can affect you:
- No one can collect a spousal or child benefit based on the covered earnings record of a worker who suspends retirement benefits on or after April 30, 2016, during the period that the worker's retirement benefit remains suspended. Those born after May 1, 1950 cannot file and suspend within this window and those born on or before May 1, 1950 must request to suspend on or before April 29, 2016 to allow auxiliary benefits to be claimed on his or her record while their retirement benefit is suspended.
- No one who requests to suspend his or her retirement benefit on or after April 30, 2016 can collect an excess spousal or excess widow(er)'s benefit while their retirement benefit is suspended.
- For those born on or after Jan. 2, 1954, deeming is extended through age 70. Deeming is the requirement that if you take your retirement benefit and are eligible for a spousal benefit or a divorced spousal benefit, you need to also take your spousal benefit and vice-versa. This leaves you with roughly the larger of the two benefits.
- Only those who suspend their retirement benefit on or before April 29, 2016 will be able to receive a lump sum payment of previously suspended benefits. Those who suspend their retirement benefits on or after April 30, 2016 can no longer receive their suspended retirement benefits in a lump sum payment.
Those who are subject to deeming, but aren't deemed to be filing for their excess spousal benefits when they file for their retirement benefit because their spouse has not yet filed for his/her retirement benefit will be so deemed as of the date their spouse files for his/her retirement benefit.
Question: My husband is 62, one quarter shy of being benefits eligible and is most likely qualified for disability and would be hard pressed to gain employment. This doesn't help our retirement planning at all. Anything we can do at this point?
Answer: Disability benefits don't require 40 covered quarters, so that's the best he can do, said O'Connor. "You might be eligible for spouse's benefits off of his disability record," he said.
Got questions about the new tax law, Social Security, Medicare, retirement, investments, or money in general? Want to be considered for a Money Makeover? Email Robert.Powell@TheStreet.com. Kim McSheridan assisted with this report.
Question: I was wondering if I could take my Social Security now at 64 and then at 66 switch over to my husband's. We were married for 20 years and he never was able to collect on his. What would be the filing times if I could?Subscribe for full article
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