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I had dinner recently with friends that I had not seen in years. Darren is 67 years old. His wife, Suzy, is 62 years old. The subject of social security has been discussed. I learned that Suzy was already receiving her retirement benefits. Darren said he was waiting until 70 to recover his.
In 15 seconds, I offered them $ 15,000 free spousal benefits to Social Security.
I told Darren: "Tomorrow, fill in social security, but only for your spouse's benefit based on Suzy's work record.You will receive half of her full retirement benefit until age 70." . "
"But," said Darren, "I thought they had changed the law to prevent people from collecting a spousal benefit while waiting to collect their retirement benefits."
"They did it," I replied. "But they kept the rights of those born before January 1, 1954. You have been preserved! So get up early tomorrow and drop limit application to the local office – just for your spousal benefit. Given the size of Suzy's full retirement benefits, you will receive a free $ 425 more per month, or about $ 15,000 over the next three years. And by the way, you pay for dinner. "
"Fantastic," said Darren. "Order what you want."
"I would have liked to have spoken to you a year ago." I complained. "You should have applied for your spousal benefit the day you turned 66. Maybe Suzy may have asked for a year or two too soon." By taking an early benefit, she allowed you to collect a free spousal benefit.You did not know it, but she knew it.However, because she filed her application earlier, her own retirement benefits will be reduced permanently. "
"Well, $ 15K, that's fine." Darren said.
Millions of couples can do what Darren and Suzy are going to do now. And the amount of free spousal benefits available can reach $ 67,000. The strategy will work, she repeats, only if the spouse who has benefited from the acquired rights has not yet applied for her retirement pension. and the other spouse has applied for a pension or is willing to do so.
What about the divorced? They too can collect a free spousal benefit (called divorced divorce benefit) up to 4 years (between retirement age and 70 years) provided they've been married for 10 years or so moreover, that their ex is over 62 years old and has been divorced for more than 2 years or b) their ex-spouse has begun to receive his retirement benefits.
As we waited for the check, Darren asked, "Are there any other tips in your sleeve?"
"There is." You can do even better by taking your pension in advance before age 70 so that Suzy can begin to receive a surplus spouse allowance out of your locker, as your retirement allowance is much higher than the that strategy could produce more than the $ 15K in higher lifetime benefits. "
"Or," I continued, "it may be better for Suzy to suspend her pension benefit at retirement age and resume at age 70 when she will be almost 30% higher. Once she / he suspends, her / his own retirement benefits will stop and she / he will earn You can not collect any benefits from your criminal record Nobody can collect a benefit from the suspended benefit while it is suspended. In this case, you will be 70 years old and will receive your own retirement pension at the Suzy age of retirement, which may be an optimal suspension, depending not only on your retirement benefits, but also on the date of your retirement. birth of Suzy and the maximum age where you can live. "
"So it's complicated," said Darren.
"Very." I replied.
"How is someone supposed to know exactly what to do?" Darren asked.
"That's where my company's software tool comes in. Run it, you can afford $ 40. It will consider thousands, if not tens of thousands of alternative common strategies to determine exactly which one maximizes your benefits. for life and those of Suzy.
"Gone?" Darren asked.
"Yes." I said. "There are a ton of options depending on the different months in which you can both take special actions and different benefits at stake. This includes the benefits for widows that Suzy will qualify for once you die. . "
"By the way," I said. "Social security officials at the local office may not realize that you are eligible for free spousal benefits – they tell you that you are not, show them the PDF from my program.If they are still wrong, ask to speak to a supervisor or call me from the office.I've talked to many supervisors in real time.It's amazing to see at how quickly they change melody when they realize that someone is speaking their language and is likely to make mistakes. "
"My other warning is this: make sure to specify in the comments section of the application that you are filing a limit claim – only for spousal benefits and you expect to wait to file your own pension benefit. If the employee you are dealing with mistakenly classifies you both your pension and your pension, your pension will start immediately and you will get a zero pension for surplus if you have earned much more than Suzy. This will reduce and not increase your lifetime benefits. Our software will tell you the payment you receive. If it's bigger than what the program says, they ruined everything. Social security staff are well meaning, but they are overworked, underpaid and poorly trained. By the way, this is because the Congress does not fund the program properly. In any case, the staff is mistaken regularly. And their mistake can become your mistake. If you do not write precisely what you told them to do in the comments section, you will have no way to appeal their mistake. "
After dinner, I wrote this section realizing that maybe 13 million Darrens and Suzys could leave a lot of free money on the table. This includes people who have acquired rights and who have applied for retirement in the year. They are always able to file an application for withdrawal of their pension benefit and to reimburse all benefits received. Once the retirement application has been withdrawn, it is possible to apply only for a spousal benefit.
In the past, I have written a lot about the free benefits of spouses and the many other ways people can maximize their social security benefits throughout their lives. I did it in my co-author, best-seller, Get What's Up to You – Revised Secrets to Maximize Your Social Security and in my blog Forbes, Ask Larry. These are additional resources to determine what you, your friends and colleagues should do to maximize their lifetime benefits.
Disclosure: I / we have / we have no position in the actions mentioned, and do not plan to initiate position in the next 72 hours.
I have written this article myself and it expresses my own opinions. I do not get compensation for that. I do not have any business relationship with a company whose actions are mentioned in this article.
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