Ask Bob: How Does Delaying My Social Security Start Date Impact My Spouse's Benefit?

A reader has been told delaying his benefit won't improve his wife's spousal benefit. Elaine Floyd of Horsesmouth explains what does, and doesn't, impact a spousal benefit.
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Question

While delaying your benefit beyond your FRA (full retirement age) will increase your benefit, I have been told by Social Security that it has no bearing on your wife’s spousal benefit or survivors' benefit.

I have scoured the Social Security information available online concerning these benefits and while there is mention of reduced benefits for starting Social Security early, they do not mention anything about delayed retirement credit, but use terms like basic benefit, workers earnings, etc.

I have two friends who are also nearing FRA, and have been told by Social Security that their spouse's benefit will not increase with delaying their benefit. It seems to me like it should, and in planning for retirement it’s HUGE.

If you could provide me with any documentation or a specific individual/phone number who can verify that delayed retirement credits will increase my spouse's benefits under any circumstance, I would be eternally grateful.

Answer

When a question arises that is not addressed in the Social Security Administration’s (SSA’s) consumer-facing website, we turn to its Program Operations Manual System (POMS), which is the reference used by Social Security employees, says Elaine Floyd, CFP®, director of retirement and life planning at Horsesmouth. “This question — exactly how are spousal and survivor benefits calculated? — is one we have clarified by deciphering the arcane language of POMS and by talking with claim specialists within SSA,” she explains.

In a nutshell, the spousal benefit (where the worker spouse is still alive) is 50% of the worker’s primary insurance amount (PIA). The PIA is the amount the worker would receive if he claims his benefit at full retirement age (FRA). It is not 50% of the worker’s actual benefit. “So, if the worker delays, his own benefit will accumulate delayed retirement credits (DRCs), but the spousal benefit will not,” says Floyd. Conversely, if the worker-spouse claims early and is receiving a reduced benefit, the spousal benefit will still be 50% of his PIA.

“However, it’s different for survivor benefits. If the worker-spouse dies after FRA, the survivor benefit will include DRCs,” she adds. If he dies before claiming, i.e., before age 70, the survivor benefit will include DRCs earned up to the month of death. If he dies after claiming, the survivor benefit will equal the amount of his benefit at death, including the DRCs he earned as a result of delaying his own benefit. “We advise all married couples to have the higher-earning spouse claim benefits at 70,” says Floyd. “This will not affect the amount of the spousal benefit but it will maximize the higher benefit for the longer-lived spouse.”

Here are the POMS references: Spousal benefits - RS 00615.201 Reduced Spouse's Benefits

Embedded in this discussion of reduced spousal benefits is the statement under B(1)(a): "The unreduced spouse's benefit is 50% of the NH's unreduced PIA.” (NH stands for “number holder” — the worker-spouse in our discussion)

Survivor benefits - RS 00615.690 Delayed Retirement Credits (DRC).

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Email Robert.Powell@maven.io

Question

While delaying your benefit beyond your FRA (full retirement age) will increase your benefit, I have been told by Social Security that it has no bearing on your wife’s spousal benefit or survivors' benefit.

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