Ask Larry: What Benefits Can My Wife Receive At 63?

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Social Security may be one of your largest assets. What and when you collect will make a huge difference to your lifetime benefits.

Today’s column examines benefits available before full retirement age, sequencing widow(er)’s and retirement benefits, availability of widow(er)’s benefits, retroactive payments and whether home ownership affects your benefit amount. Larry Kotlikoff is the founder and president of Economic Security Planning, a company that markets Maximize My Social Security, a Social Security benefits calculator referred to in this post.

See more Ask Larry answers here.

Ask Larry about Social Security:

What Benefits Can My Wife Receive At 63?

Hi Larry, If I collect my social security at 63, can my wife claim spousal benefits on my earnings then? She will be 63 also. Or does she collect her own retirement benefits which will be much lower than her spousal benefits. If she can, can she switch to spousal benefits at her full retirement age of 67. Thanks, Ben

Hi Ben, If your wife files for benefits at age 63, she’ll be deemed to be filing for both retirement benefits on her own record and spousal benefits on your record, assuming that you are already drawing your retirement benefit when she files. She cannot file for reduced benefits on one record before full retirement age (FRA) and then switch to the other record at FRA. Depending on your birthdates and relative benefit amounts, numerous potential filing strategies are available to you and your wife. You can run Maximize My Social Security or another top rated program to help determine your best filing strategy. Best, Larry

Does My Plan Make Sense?

Hi Larry, I am a widow and still working, earning $40,000 per year. I intend to continue working until age 66. My current benefit estimate is $1,131 per month and at age 66 is $1,307. My husband (ten years older) died at age 60. My estimated widow’s benefit today is $1,551 but lower at 66. I have been told to start benefits today based on my earnings subject to the earnings test and then at age 66 switch to my widow’s benefits. Does that make sense? Thanks, Carolyn

Hi Carolyn, Maybe, but it’s simply not possible that your widow’s benefit rate would be more now than if you started drawing it at age 66. Since I don’t know the correct widow’s benefit rates, I can’t tell you what strategy is best. However, your best option is likely one of the following:

  1. File for reduced retirement benefits on your own record now, then file for unreduced widow’s benefits at age 66; or,
  2. File for reduced widow’s benefits now, and then switch to retirement benefits on your own record at age 70.

It will likely be best for you in the long run if you wait to take the higher of the 2 benefits last. Your widow’s benefits would be at their highest rate if you start them at age 66, but your own benefit rate would be 32% higher than your PIA if you delay taking them until age 70. PIA stands for primary insurance amount, and it is essentially the unreduced benefit rate payable at full retirement age. So, if your PIA is $1307, your retirement benefit rate starting at age 70 would be $1,725. And, if your widow’s PIA is less than that, it may be best to start drawing reduced widow’s benefits now, then switch to your own record at age 70.

What you should do first is check back with Social Security to verify the correct PIA on your husband’s record. Then, you’ll probably want to run expert software, either my company’s software or other very careful software. Maximization software can calculate your own benefit rate, but you’ll need to input the correct widow’s rate. Make sure to select software that is also programmed to consider the effect of the Social Security earnings test, and you’ll want to be sure to accurately estimate your expected yearly earnings. You’ll want to take these actions ASAP, because you can’t claim reduced Social Security benefits retroactively, and failing to file an application by the end of this month could end up costing you money. Best, Larry

Will I Be Eligible For Widow’s Benefits If My Husband Dies Before Me?

Hi Larry, There is undoubtedly a very easy answer to this question, but I cannot seem to find it. I apologize if this is explained elsewhere ––– I have spent quite a bit of time looking and seem to only find cases where the widow was not previously receiving benefits. My husband and I are both began taking our retirement benefits when we reached the age of 67. He is now 70 and I am 72. His monthly benefit is $2,515 and mine is $1,612. Were he to die before me, will I only be eligible for the tiny onetime widow’s benefit, or is there a way for me to apply for a higher monthly benefit than I am currently receiving based on my husband’s higher monthly benefit? Thanks, Sandra

Hi Sandra, If your husband dies first, you will get his higher monthly rate instead of yours. The way it would actually work is that you would continue to receive your own benefit, plus an excess widow’s benefit equal to the difference between your two rates. Best, Larry

Why Does My Benefit Statement Say That I Was Paid For Prior Years?

Hi Larry, Why does my benefit statement say that I was paid $9,450 in 2016 for 2014 and paid $5,250 in 2016 for 2013? Where did those amounts come from? Thanks, Tom

Hi Tom, I don’t know, but sometimes Social Security pays retroactive benefits that date back for a number of years. This can happen for a number of reasons, such as a successful appeal or other potential reasons. You would need to check with Social Security for an explanation. Best, Larry

Can I Get Social Security Benefits At Age 63 If I’m Making House Payments?​​

Hi Larry, Can I get benefits at age 63 and be a homeowner still making payments. I’m not working so I have no income but I’m building up equity ––– will that reduce or wipe out my benefits? Thanks, Ernesto

Hi Ernesto, Yes, assuming that you have enough work credits to be eligible for Social Security, or you qualify for benefits on the record of someone who does. What you own has nothing to do with Social Security eligibility. Best, Larry

To learn more about your Social Security options, visit Economic Security Planning, Inc.

Click here for my company’s extremely powerful personal financial planning products, designed to safely raise your living standard, and click Ask Larry to pose Social Security questions.