Social Security Benefits: Social Security is commonly associated with retired or disabled workers; however, it also provides benefits to the spouses of those workers, a portion of whom have not contributed a cent to Social Security taxes. Although spousal benefits and employee retirement benefits are comparable, there are a few significant distinctions.
Before anything else, you are ineligible to apply for spousal Social Security benefits; your spouse must first apply. A few additional regulations pertain to spouses who file their claims early. If you are 62 years old and considering applying for spousal benefits, the following information is essential:
SSA Payment Schedule 2023 (Direct Link) Social Security Payment Check Status @ ssa.gov
The method by which the government computes Social Security benefits for spouses
Before discussing the repercussions of prematurely claiming spousal Social Security benefits, it is necessary to define the phrase “on time.” The government assigns each individual a full retirement age (FRA), which is based on their birth year. Yours is specified in the table that follows:
| BIRTH YEAR | FULL RETIREMENT AGE (FRA) |
|---|---|
| 1943 to 1954 | 66 |
| 1955 | 66 and 2 months |
| 1956 | 66 and 4 months |
| 1957 | 66 and 6 months |
| 1958 | 66 and 8 months |
| 1959 | 66 and 10 months |
| 1960 and later | 67 |
Receiving your spousal benefit at your FRA will entitle you to fifty percent (PIA) of your partner’s primary insurance. They are eligible for that benefit through their FRA. If their PIA was $2,000, for instance, your spousal benefit would amount to $1,000.
However, at their FRA, the preponderance of seniors do not begin receiving Social Security benefits. As a result, the government performs further computations to ascertain the most suitable way to modify their benefits.
The repercussions of prematurely asserting
Social Security benefit reduction applies if you file before your FRA, regardless of whether you are claiming on your own or another person’s employment history. Additionally, if you register at age 62, your monthly benefit will be significantly reduced. This is particularly true regarding spousal benefits, as the early withdrawal penalty is more severe compared to that imposed on employees.
Early claims result in a 5/9 loss of 1% per month for employees for a maximum of 36 months. However, families experience a monthly loss of 25/36 of 1% during the same time frame. An additional 5/12 of 1% per month is deducted from both categories for each month that early claims continue beyond 36 months.
To illustrate the magnitude of the disparity, consider a worker who possesses a PIA of $2,000 and their spouse, who is eligible for a maximum spousal benefit of $1,000. The following depicts the appearance of their checks at different claiming ages, presuming they both have FRAs of 67:
| CLAIMING AGE | WORKER’S MONTHLY BENEFIT | WORKER’S BENEFIT REDUCTION | SPOUSE’S MONTHLY BENEFIT | SPOUSE’S BENEFIT REDUCTION |
|---|---|---|---|---|
| 62 |
$1,400 |
30% |
$650 |
35% |
| 63 |
$1,500 |
25% |
$700 |
30% |
| 64 |
$1,600 |
20% |
$750 |
25% |
| 65 |
$1,734 |
13.3% |
$834 |
16.6% |
| 66 |
$1,866 |
6.7% |
$916 |
8.4% |
| 67 |
$2,000 |
0% |
$1,000 |
0% |
Although such a severe penalty could deter some individuals from claiming early, it is not invariably a misguided course of action. If you and your companion are in dire financial straits or have a short life expectancy, it is prudent to file for benefits at age 62 to maximize your benefits. However, this may not be the most prudent course of action for a person who has the financial means to postpone benefits should they desire to live a lengthy life.
It is noteworthy that individuals desiring to postpone spousal Social Security benefits may be acquainted with the concept of delayed retirement credits for employees. Until they reach the age of 70, they increase their monthly payments by two-thirds of one percent for each month that they postpone benefits beyond their FRA. However, this does not pertain to spousal benefits.
You are entitled to a maximum spousal benefit of fifty percent of your partner’s PIA. As previously mentioned, eligibility for this commences at your FRA; therefore, there is no motivation to postpone spousal benefits beyond this point. Unless your spouse has not yet filed for Social Security and prevents you from doing so, you should submit your application to your FRA at the latest.
If you and your partner are uncertain about the optimal time to register, you should consult them to ensure that you are both on the same page. Once this strategy is established, it will be possible to approximate the Social Security benefit and the portion of retirement expenses that will require personal funding.
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