Social Security Strategy Tips for Married Couples

A married senior couple is using laptop at home.
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For single people, knowing exactly when to start Social Security benefits depends on a lot of factors, such as life expectancy and their retirement portfolio. But what if you are married? Social Security for married couples gets even more complicated, and there can be a lot to think about.

See: 10 Reasons You Should Claim Social Security Early
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Every couple is unique, so that means there is no blanket advice that will work in every situation. Still, there are some basic guidelines you might be able to follow when it comes to claiming Social Security. With the help of the experts, let’s take a look at some of the best strategies for maximizing Social Security for married couples.

Tips on Claiming Spousal Benefits

Social Security includes a benefit for spouses. Needless to say, understanding the spousal benefit and how to take advantage of it is one of the most pertinent parts of this topic. We’ll cover several important points here to help you take full advantage of spousal benefits.

All Spouses May Be Entitled to Social Security Benefits

You might think you are only entitled to Social Security benefits if you made enough money or paid enough into the system. However, for married couples, any spouse can claim Social Security, regardless of their earnings, says Marina Shepelsky, family attorney in New Jersey and New York.

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“For example, if a couple is married for 10 years or more and then decides to part ways — each spouse is entitled to a certain percentage of the Social Security retirement benefit of the other,” Shepelsky says.

The important point here is that even if a married couple separates, both partners may be able to claim Social Security. That is true even if one of the partners has no lifetime earnings, Shepelsky says. “Even if the wife never worked a day in her life and never showed any earnings, and she is now divorced from the breadwinner husband — the wife will receive a percentage of his benefits provided that certain conditions are met.”

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Claim Spousal Benefit Before Your Own

In many cases, spousal benefits are crucial in the event that they are higher than one partner’s full benefit amount. However, one strategy is to claim the spousal benefit early while delaying your own benefit. The spousal benefit is a maximum of 50% of the higher earner’s salary, but that amount can still be beneficial if the lower earner intends to claim their own benefit later.

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Philip Herzberg, CFP and lead financial advisor at Team Hewins, says one spouse can use this strategy to delay their own benefit until age 70 while claiming the 50% spousal benefit. “This strategy may help to maximize survivor’s income, as well as retirement income, since the surviving spouse will be eligible for the greater of his or her own benefit or 100% of the spouse’s benefit,” Herzberg says.

Have You Been Separated at Least Two Years?

If you were married but have since separated, you might be eligible to start collecting Social Security, Shepelsky says. “If you have not applied for Social Security retirement benefits but already qualify for them (for example, you did not apply but you are already 66 years old), your ex-spouse can immediately begin to receive the benefits using your record, provided that you are divorced for at least two straight years.”

Delaying Your Benefits Leads to Higher Monthly Payments

This particular point is not limited to married couples, but there can be more to think about if you are married, particularly if you have shared finances. The biggest reason to delay your benefits is because you’ll receive an 8% increase in benefits every year you delay payments beyond your full retirement age. Those increases stop at 70 years old, but that can result in much higher payments overall.

Of course, the problem is that none of us knows exactly how long we’ll be around, says Jody Jody D’Agostini, advisor at Equitable Advisors.

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“Social Security is guaranteed income that will stay with you until your last day,” D’Agostini says. “If the higher wage earner dies before his/her spouse, the spouse can step up to the higher Social Security amount thereby maximizing the household strategy. If it is possible to live off savings, delay retirement, or work even part time to accomplish this, it will likely be a good choice”

Don’t Forget About Tax Implications

Social Security benefits are taxable, and that means they are considered income from the perspective of the IRS. Steve Parrish, adjunct professor at The American College Of Financial Services, says this can result in retired couples being hit with a “tax torpedo,” or excessively high taxes.

According to Parrish, middle-class couples should delay filing for Social Security in order to avoid the tax torpedo. “If, instead, they expect to be high bracket taxpayers in retirement, they must look at their Medicare premiums and how they coordinate with their Social Security benefits,” Parrish says. “In some situations, the high taxes associated with a working spouse can cause a non-working spouse’s Social Security check to be reduced.”

As Parrish explains, the working spouse’s check may be reduced because “the Social Security benefit payment usually first subtracts the Medicare Part B and D premiums.” In other words, high premiums can lead to a significantly reduced Social Security benefit.

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About the Author

Bob Haegele is a personal finance writer who specializes in topics such as investing, banking and credit cards. He left his day job in 2019 to pursue his passion for helping people get out of debt and build wealth. You can find his work at outlets such as Business Insider, Forbes Advisor and SoFi.
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