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Q&A: "I am 65 and my Wife is 55. Is There Another Solution to File-and-Suspend at 66?"

Social Security

Question and background: 

I am 65 and my wife is 55. There has been much discussion about boosting Social Security by my signing up at 66, then suspend and allow my wife to collect benefits. She would not be 62 at that time. I don't think this would work. Is there another solution?

Answer:

You're right that, due to age difference, there's no reason for you to file and suspend at Full Retirement Age (FRA) of 66. Rather, you could simply wait to draw social security at age 70 and collect a benefit of 132% of your age 66 benefit (plus cost-of-living adjustments). 

The way you and your wife will want to evaluate this is from the standpoint of survivor benefits rather than standard benefits. Why? Because the surviving spouse receives the higher of their own benefit or 100% of the deceased spouse's benefit. The impact is quite pronounced when the surviving spouse's own benefit was considerably lower than the deceased spouse's (which may or may not be your case).

We guys tend to not live as long as the ladies. Add to that the 10 year age difference between you and your wife. If you both are in regular health and can reasonably be expected to live to normal life expectancies, then as a family unitit may make the most sense for you to wait until age 70 to boost your benefit as high as you can.

If your delayed benefit is higher than your wife's, then your wife could well end up receiving that higher benefit for 13-14 years after your death. 

I'd encourage you to find a good financial planner to run a social security analysis using your and your wife's specific earnings and benefit information. Using a fee-only advisor who works for you will keep you from being pitched financial products to compensate for the "free" social security advice.

Hope that helps. Please feel free to get in touch if you'd like to discuss your situation in detail.