Question: I just turned 62 in May 2014. My wife turns 62 in December 2016. When and what do we need to file?
On the few calls we have made to Social Security advisers or the Social Security Administration, we don’t seem to get straight answers. I would like to work until 64-65 just for the medical insurance. I have other investments and a 401K, but want to get the most possible out of Social Security. My wife does not work any longer; she is a stay-at-home wife primarily to take care of her mother. I just want to make the right decisions to maximize our retirement earnings and make sure I/we apply for Social Security and Medicare at the right times.
Answer: There are some great technical experts at the local Social Security offices, but sometimes getting advice from Social Security can be tricky, especially if you’re not exactly sure what information you’re looking for. Plenty of people have written me about wrong advice they’ve received, so make sure to check your answers with several different advisers.
Your best strategy is, I believe, to file for your retirement benefit when you reach full retirement age and suspend its collection. When you reach 70, you’ll start collecting your retirement benefit. This will permit your wife to file just for her spousal benefit at her full retirement age and also wait until 70 to collect her retirement benefit. By filing at your full retirement age, you give yourself the option to collect all suspended benefits in a lump sum check in the case of an urgent need for cash. Requesting suspended benefits will, however, mean you will lose the delayed retirement credits for all the months during which you suspended your benefit.
If your wife was a much higher earner when she worked, it’s possible (remotely possible) that your best strategy is for her to file early (before full retirement age) to enable you to collect just your spousal benefit until you reach 70, when you’ll flip onto your retirement benefit. She’d collect a reduced retirement benefit and then suspend it at full retirement age and start it up again at 70.
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