How To File and Suspend Your Social Security Benefits

23 May 2011 86 Comments Print This Post Email This Post

I get a lot (a LOT) of questions about the File and Suspend tactic for Social Security benefits, so I thought some more review would help.  For the uninitiated, File and Suspend is a tactic that married couples can use to help maximize their total Social Security benefits.  In this post I’ll try to cover some of the more common questions.

File and Suspend works like this: One of the two in the couple can file an application for Social Security benefits and then immediately suspend in order to not receive the benefits. This can allow the other spouse to utilize the first spouse’s record to receive a Spousal Benefit.  Other eligible dependents (such as children under 18) can also receive benefits based upon the filed and suspended record.

There are a few factors to note about File and Suspend:

  • You must be at least at Full Retirement Age (FRA) to File and Suspend.
  • Either spouse can File and Suspend, but not both.  By Suspending, you are not eligible to receive a Spousal Benefit.
  • If the non-Suspending spouse is under FRA and begins receiving Spousal Benefits, he or she will no longer be earning Delayed Retirement Credits (DRCs) on his or her own record.  Plus both the Spousal Benefit and the “own” benefit of the non-suspending spouse will be permanently reduced by filing before FRA.
  • The spouse that has not Filed and Suspended can receive Spousal Benefits based on the other spouse’s record at any age over 62 – but the amount of the benefit will be reduced if the spouse receiving Spousal Benefits is less than FRA.  At FRA, the Spousal Benefit would be 50% of the filed and suspended worker’s Primary Insurance Amount.

Why File and Suspend?

The main reason for File and Suspend is to allow the Suspending spouse to delay receiving benefits, earning up to 8% in Delayed Retirement Credits (DRCs) per year.  This will not only increase the amount of benefit that the Suspending spouse will receive when he or she files for benefits, but it will also increase the amount of Survivor Benefits for the other spouse.  At the same time, the other spouse can be receiving Spousal Benefits based on the first spouse’s record.

Here’s an example: The husband has a PIA amount of $2,300, and his wife has a PIA amount of $1,500.  The couple are both at FRA.  The husband Files and Suspends, and the wife can immediately begin collecting a Spousal Benefit equal to 50% of the husband’s PIA – $1,150.  At the same time, both spouses are accruing DRCs on each of their own records.  Both of them can delay filing for benefits on his and her own record until age 70, at which point they will each have achieved the maximum benefit on their own records.  When she reaches age 70, the wife will file for her own benefit and discontinue receiving the Spousal Benefit.  The husband will also re-file at age 70.

Another example: The wife has a PIA amount of $2,000, and the husband has a PIA of $1,000.  The wife is at FRA, and the husband is a year younger.  When the husband reaches FRA, the wife could File and Suspend, and the husband can begin receiving a Spousal Benefit of 50% of the wife’s PIA, delaying filing for his own benefit in order to receive the DRCs.

The husband in the second example could choose to begin receiving Spousal Benefits before FRA.  In that case though, he would not be eligible for DRCs.  This is due to the rule that requires a “deemed filing” if you file for Spousal Benefits prior to FRA.  A deemed filing is the same has having filed for your own benefit, and as such your benefit and the Spousal Benefit will be reduced, permanently, due to the early filing.

A third example: The husband has a PIA of $2,000 and the wife has a PIA of $500.  The husband is two years younger than the wife, she is 66 (FRA) and he is 64.  The wife has begun receiving her own benefit at FRA.  Since the husband is not yet at FRA, File and Suspend is not available to him.  However, once he reaches FRA, he can File and Suspend, and the wife can begin collecting a Spousal Benefit, increasing her own benefit to 50% of his PIA.

It’s important to note that for all of the examples, the spouse that is described as having Filed and Suspended could just as easily filed for his or her own benefit and begun receiving it immediately, rather than suspending.  This would also enable the other spouse to begin receiving Spousal Benefits.  The spouse that is collecting benefits on his or her own record would just no longer be accruing DRCs for his or her future benefit.

IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this communication (or in any attachment) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in this communication (or in any attachment).

  • Decemberdad

    I am retired, 64, and my FRA is 66. My wife is works and is younger and we have 2 children under the age of 18. Is there a way to get benefits for my children now? Or must I wait to be able to file/suspend after I am 66.
    I would prefer to wait as long as possible to start collecting as long as the kids can get some income while I am waiting to collect. Are there rules as to what this money can be used for? 502B? Food/clothes?

  • Sunshine

    My age-70, started benefits at 62. Can husband at 66 collect on my benefit and also file and suspend his benefit so I can collect spousal benefits on his record?

    • Joe Alfonso

      First off, only one spouse can claim a spousal benefit at a time.

      If your original FRA benefit (before reduction for early claiming) was less than 50% of your husband’s PIA, then if your husband files for his benefit you are entitled to an increase to your benefit called the spousal adder. You cannot get a spousal benefit otherwise because you filed for your own benefit early.

      Your husband can file and suspend but that would only make sense if your PIA is less than 50% of his, entitling you to the spousal adder. Otherwise, if he wants to delay his benefit and receive a spousal benefit in the interrim he needs to file a “restricted application” with SSA. This will allow him to claim a spousal benefit now on your record and switch to his own retirement benefit in the future, increased by the delayed credits after FRA.

      You should ask SSA to lay out these various options for you before deciding. Or better, work with a planner with expertise in this area.

  • TBRetired

    When husband is file and suspended, can he still continue work(employed) while the spouse is receiving the 50% based on the husband’s rate? Understanding we have to pay tax on the husband’s earning.

    • Joe Alfonso

      Yes. And he will receive credit for continuing to work which could increase his benefit (and yours) as well.

  • SS12

    File and suspend is only for married people, not singles

    • Joe Alfonso

      Anyone can file and suspend, not just married couples. Married couples do this in order to collect a spousal benefit while the higher earner delays his own benefit to earn delayed credits. However, ANYONE, even singles, can file for and suspend their benefit at FRA. Doing so preserves their ability to receive a full lump sum reimbursement of all suspended benefits if they decide to restart these before age 70 due to an emergency or other unforseen change in circumstance.

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Larry,

    Although I hate to discourage them when they want to give you more, the rules won’t allow both spouses to file and suspend and each receive spousal benefits.

    This is because when you file and suspend, you may be eligible for other benefits (such as a survivor benefit or a spousal benefit) but you’re only allowed to receive the excess above and beyond the PIA that you’ve suspended.

    In practice, if one spouse’s PIA was less than 50% of the other spouse’s PIA, that spouse could file and suspend and receive the excess (the amount greater than the PIA that is suspended).

    Now, on the other hand, the other spouse’s PIA must be greater than 50% of the first spouse’s PIA. We established that when we decided that the first spouse was eligible for an excess spousal benefit. So there’s no excess for the second spouse to receive.

    jb

  • Larry

    An agent at the Social Security office in Boise told us last week that we can both file and suspend and collect each other’s spousal benefits, and then age 70 switch to our own undiminished.

    You say only one person can file and suspend. Can you check and confirm if that information is still valid and the SS guy is wrong?

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Debbie,

    Call back and ask again. If you get the same runaround, telling you to read the website, tell them that you read the website, specifically POMS section GN 02409.110 part A(2) which states

    “The decision to voluntarily suspend retirement benefits applies only to the numberholder. Do not adjust benefits to other beneficiaries on the record.”

    That seems pretty irrefutable.

    Best wishes to you -

    jb

  • Debbie

    I’m sorry, my son is currently a junior in high school. He will be a senior when he is 17. He will turn 18 one month after graduation.

  • Debbie

    My husband is 65. He will be FRA in December 2012. We have a son who will turn 17 in July 2012 and is a senior. According to what you wrote above, my husband should be able to file and suspend in January 2013 and then file for dependent benefit for my son until he’s 18 or 19 if still in high school.

    We called the social security office today and the representative said that when my husband suspends that it stops my dependents benefits. She said it wouldn’t stop a spouses, but it does a dependent child. She insisted and said read the website. She said the reason it only mentions filing and suspending when talking about a spouses benefit is because its for spouses only. I told her that was not what i read on other websites and she said I could go into an office if I didn’t trust her, but that they only go by what is on the social security website.

    How do I get this benefit if they don’t agree that you can qualify?

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Spot on, Frank. You’ve covered the calculations exactly correct.

    jb

  • Frank

    Jim,
    I should have known that there is no such thing as a “free lunch”! Thank you for taking the time to research that. I appreciate the fact that people can turn to you for reliable answers in this area.

    So I worked up the calculations to compare the two options (tell me if this is correct; I think other people may find this useful if they plug in their own numbers):

    My wife’s own benefit at her FRA is $306 a month. If she files for it at 62, she would get only $208 a month. When she’s 66, I will have been retired for 2 years, collecting my $1917 monthly and she can file for her spousal benefit. My wife’s maximum spousal benefit would have been $958 a month, if she had not filed early.

    So in this case they’ll take her $958 maximum spousal benefit, and subtract her own maximum benefit of $306 — the amount she would have received at her FRA. The difference is $652. Because she’s 66, she’s eligible to receive the full $652. Her monthly check at 66 will include her own reduced benefit ($208) plus her maximum spousal benefit ($652). The result: She’ll get $860 a month.

    By contrast, if she waits until she’s 66 to apply for Social Security, she’ll get her own full $306 benefit plus the difference between that $306 and her $958 maximum spousal benefit — i.e., $652. The result: Her monthly check will be $958.

    In our particular example of her filing at 62, she gets an extra four years of benefits that add up to $9,984, while her long-term benefit would be $98 a month smaller. Only we can decide if the trade-off is worthwhile.

    Sincerely,
    Frank

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Frank,

    I apologize for the back and forth on this, but I’ve further clarified this with SSA, and here it is:

    When your wife files for Spousal Benefits at FRA, the total benefit received will be less than 50% of your PIA. The reduction will be equal to the difference between her PIA and her actual retirement benefit, which was reduced due to filing early.

    Thanks for your patience.

    jb

  • Frank

    Jim,
    To re-clarify and confirm my previous scenario:
    1). You agree that my wife should (and legally can) now at 62 file to claim against her”projected $208 benefits she would be entitled to each month for the next 4-years until she attains FRA; and then, at that time she can re-apply for spousal benefits and collect $958 (50% of my $1917 FRA earnings) thus giving us a combined total of $2875 monthly from then on?

    2). There would be no penalties involved, right?

    3) Would you do this if you and your spouse were in our shoes? I don’t see any other option to maximize overall earnings.

    Frank

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Frank,

    From your description, I believe you have the facts straight – if your wife doesn’t file for the spousal benefit until FRA. If she files before that point, her total benefit will be less than 50% of your Primary Insurance Amount.

    jb

  • Frank

    I am 64 and my wife is 62. My wife’s PIA is $308. My PIA is $1,917.

    If it is possible, would it not be smart for my wife to file for SS now in order to start earning about $208 per month and then when I reach FRA (at 66) and am able to collect $1,917 monthly, could my wife at FRA (4 years after her initial filing) then apply for spousal benefits and get 50% of my benefits (about $958 monthly) even if she has been collecting $208 for the past 4 years from her earnings (of about $10,000)? Or would she penalized for this action?

    If the above is possible, it would be a better choice rather than have her not file and wait to collect at her FRA, right?

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Shelli -

    Just to be clear, you asked about SSI for disability. If it was regular Social Security Disability, at FRA this changes over to regular retirement. In that case, file and suspend would interrupt the benefit he’s been receiving.

    jb

  • Shelli

    Jim, that was exactly my question – wanted to make sure taxpayer could file and suspend on retirement benefits while not losing disability benefits. Thanks for your response.

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Shelli,

    I’m not sure I understand your question. I think you are indicating that the taxpayer is of full retirement age and is also on SSI for disability, and the question is can he or she file and suspend retirement benefits at that time? If so, then the answer is yes, the individual can file and suspend, as long as he or she is at least full retirement age. This will enable his spouse to collect spousal benefits based on his retirement record while delaying receipt of his own retirement benefits.

    jb

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Thomas,

    You should be able to take care of all of your filing, suspending, and your wife’s filing in one visit, as long as there aren’t any snags in the process.

    I can’t tell you how many forms you’ll have to fill out, but I’m sure there will be plenty. (It is the government, after all!)

    Best wishes to you

    jb

  • Shelli

    Hi Jim, thanks for your help in navigating this maze! My question is this – if a taxpayer is on SSI Disability, can he file & suspend so his spouse can collect and still receive his SSI Disability? Thanks in advance.

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Jim,

    After Full Retirement Age you can suspend your active benefit and receive delayed retirement credits from the time of your suspension until as late as age 70. Since you’ve only got until 12/2014, which is 33 months from this writing, your increase will be less than the maximum.

    If you don’t need the extra money, it’s probably a good decision. This will have no effect on your wife’s benefits.

    jb

  • Thomas

    Thanks Jim,
    Think we will take your advice to file and suspend if there are no income limitations, as I still work. Also curious, when we go to Social Security office, for me to file and suspend, are there two separate forms to fill out or just one, and if two, do I complete both forms at same time. I guess my wife must additionally complete form for spousal benefits. Hopefully, you tell us , all forms can be completed in one visit to Social Security office. Thanks for your help.

  • Jim

    My wife (DOB 11/25/45) started collecting early at age 62. Her benefit increased when I began collecting effective February 2011 after turning age 66 on 12/20/2010. But, I still work full time and am second-guessing my decision for 2 reasons: taxability of my benefit and higher benefit at 70. Do I have any options to suspend my benefit, or is it too late?

  • Jim

    My wife (DOB 11/25/45) started collecting early at age 62. Her benefit increased when I began collecting effective February 2011 after turning age 66 on 12/20/2010. But, I still work full time and am second-guessing my decision for 2 reasons: taxability of my benefit and higher benefit at 70. Do I have any options to suspend my benefit, or is it too late?

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Thomas,

    If you’re in a position where you can delay both benefits as long as possible (to age 70), then it will make sense to file and suspend your benefit and your wife can then file for the Spousal Benefit alone, once you’ve both reached FRA.

    This way you are accruing the delayed retirement credits on both of your records, while at the same time receiving half of your PIA (the Spousal Benefit for your wife) for the four years between age 66 and 70.

    jb

  • Thomas

    Husband and wife both turning 66 within next few weeks. Husband projected SS amount at 66 is $2350 and $3100 at 70. Wife projected SS amount at 66 is $1930 and $2545 at 70. Both in good health and after extensive reading not sure best option. We think it comes down to File and Suspend or wife taking spousal benefits on husband’s amount. Welcome any suggestions.

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Hi Dan -

    Spousal Benefits are not based upon your benefit, but rather on your PIA. The PIA for you is the amount that you would have received had you delayed filing for benefits to Full Retirement Age. Of course, Cost-of-Living-Adjustments would also be applied, but no other increases or reductions (beyond the reduction if she files prior to her own FRA).

    Hope this helps -

    jb

  • Dan

    Hi Jim,

    Excellent article! Thank you for providing us with helpful information.

    My question relates to Susan’s inquiry…and your response to her was as follows…

    “Susan -
    My source at SSA says that you can suspend at FRA after collecting for several years. The delay credits would be applied to their reduced benefit (since he or she filed early). I just reconfirmed this, and he indicates that the page http://www.socialsecurity.gov/retire2/suspend.htm is the reference to use.”

    My situation is that I started taking SS benefits at age 62 but plan to file and suspend when I turn age 66 and then restart again at age 70 so that I can increase my monthly $ benefit amount.

    What $ amount will my younger wife (by 8 yrs), receive re: spousal benefit when she applies when I turn 70? Will her benefit amount be based upon what I received at age 62 or will it be based upon the increased amount I will begin receiving at age 70?

    Thanks for your help,

    Dan

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Mary,

    Spousal Benefits do increase via annual Cost of Living Adjustments (COLAs), but after the benefit is first applied for, these benefits do not increase with increases to the other spouse’s future retirement benefit (if suspended and accruing delayed credits).

    So the answer is no, the benefit will not continue to increase other than by COLAs.

    jb

  • Mary

    Jim,

    I am now 65. If I file and suspend at 66 and my spouse (who is 70) collects spousal benefits (which would be larger than his current SS income), do his spousal benefits continue to increase? That is, when I am 70, will he receive half of my increased SS income as his benefit?

    Thank you for your help.

    Mary

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Michael,

    If you file and suspend at age 66 and your wife files for spousal benefits at age 62, the amount will be less than 50% – it will be approximately 35% since she’s filed early.

    jb

  • Michael

    This year I will be 66 and my wife will be 62. She does not work any more. Can I file and suspend at 66 and can she file at 62 and receive a check off of my SS at 50% at this time or will it be less if we do this now. Thanks!

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Allen,

    The strategy that you describe is not available. You cannot file solely for the Spousal Benefit prior to Full Retirement Age (FRA), nor can you file and suspend prior to FRA.

    Most likely the way to maximize for you would be to wait until FRA and then file solely for the Spousal Benefit and delay filing for your own retirement benefit to the latest age (70) in order to achieve the maximum in delay credits.

    jb

  • Allen

    Jim,
    I have read all these questions on receiving spousal benefits and still am fuzzy.
    My wife is 62 and receiving about $1000 a month, I am 64 (65 July). My understanding is I can file and suspend and get (reduced) one-half of hers until FRA (or any age in between FRA & 70) and my DRC will NOT be affected when I start my PIA. Any downside with getting spousal benefits? Also, her PIA is more than one-half of what I WILL get.

    Thanks.

    DN

    Resent, because I was unsure it was received after the return screen.

  • Allen

    Jim,
    I have read all these questions on receiving spousal benefits and still am fuzzy.

    My wife is 62 and receiving about $1000 a month, I am 64 (65 July). My understanding is I can file and suspend and get (reduced) one-half of hers until my FRA (or any age in between FRA & 70) and my DRC will NOT be affected when I start my PIA. Any downside with getting spousal benefits? Also, her PIA is more than one-half of what I WILL get.

    Thanks.

    AN

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Nancy,

    Yes, I believe that in the first year your income is counted on a monthly basis; as well, in the year of FRA the formula is changed to $1 for every $3 above the limit, and the limit is higher ($38,880).

    jb

  • Nancy

    Yes, thanks. And do you agree with the monthly vs annualized approach to the income limitation? For instance, if that first “year” of benefits starts in February, and you have no income until $25,000 in December, you would not have to repay the benefits received February-November. Also, is it true that in the calendar year in which you reach FRA (for my husband, December 2013)benefits are reduced $1 for every $3 (instead of $2) income?

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Nancy -

    “Suspend” has a special meaning to Social Security. Prior to FRA, if you’re earning more than the annual limit, your benefits are reduced by the formula of $1 for every $2 in income over the limit. This is not the same as Suspending benefits, although the result to the benefit receiver is the same if the amount of income is enough to eliminate the benefit altogether.

    Hope this helps -

    jb

  • Nancy

    My husband is 64, retired 3 months ago, and “may” have earnings in 2012 in excess of $15,000. An agent in the SSA office told us that in the first year of collecting benefits (whether prior to FRA or not), the formula for the earned income cap is applied on a monthly rather than annualized basis, so that in theory one could earn, for example, $5000 one month and collect no benefits, $0 the next month and collect full (or age-reduced in our case) benefit, etc. However, I just read this on the SSA website: “If you have reached full retirement age, but are not yet age 70, you can ask us to suspend retirement benefit payments.” This says to me that benefits cannot be suspended if pre-FRA application has been made. How does this play into the earned income cap? Or does SSA do the “suspending” for you based on reported earnings?

  • Susan

    Thanks. We will go to a local office after the holidays, bringing this page. Hopefully the person I spoke with today didn’t know what she was talking about.

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Susan -
    My source at SSA says that you can suspend at FRA after collecting for several years. The delay credits would be applied to their reduced benefit (since he or she filed early). I just reconfirmed this, and he indicates that the page http://www.socialsecurity.gov/retire2/suspend.htm is the reference to use.

    Hope this helps -

    jb

  • Susan

    Hi again… re your answer that “you can suspend at FRA, even though you have already been collecting for several years. The Delayed Retirement Credits (DRCs) will be factored against his reduced benefit, but should still provide some increase to the overall benefit when you file again.”… I just got off the phone with social security. According to them the only instance that you can suspend benefits is that you are earning too much to qualify. We would like to suspend my husband’s benefits, not because he is earning money, but because we decided it would be a better idea to live off savings (that are earning nothing) for a few years. Is this not possible? Did I misread your answer to another reader? Thanks
    Susan

  • Susan

    Thank you again, your answer to maureen byrnes answered the question that I’ve been trying to find the answer to!
    Great job :)

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Susan -

    Thank you for your kind words. It’s nice to know that folks get a benefit from all of this!

    You’re right, he cannot file for spousal benefits because he’s been collecting all along. Suspending doesn’t change that fact: you can’t file and suspend and collect spousal benefits.

    jb

  • Susan

    Ah, I just reread your info, so it looks like the answer is that he cannot file for spousal benefits. Sorry to waste your time.
    Susan

  • Susan

    Hi there, just to make sure I understand… My husband will be 66 in March, I will be 65. We have both been collecting SS for 3 years. My PIA is more than half his, so I would not collect as a spouse. From a previous response, I understand he can suspend his benefits in March, even though he’s already been collecting, to gain more benefits in a few years. My question then is can he file for spousal benefits from me once I reach full retirement age at 66? Thanks you so much, this is the best information I’ve found, and I’ve looked for months!
    Susan

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    David -

    Once you have filed and suspended, your wife will be eligible to file for the spousal benefit. She will need to file for this, it will not automatically be filed for her.

    jb

  • David

    Jim,

    Thanks for clarifying “file and suspend”. My wife is already collecting benefits based on her own work record, but the spousal benefit would be higher. If I file and suspend next month at FRA, will SSA automatically pick up on this and recalculate her benefit,or will she need to go to SSA and make some sort of application? Thanks

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Suzy -

    To be considered Full Retirement Age, it’s actually the month after his birthday, unless he happens to have been born on the 1st. So any time during the month after his 66th birthday he can file and suspend.

    jb

  • Suzy

    Jim,

    Ty, so in order for him to continue to earn his credits for working, he will be 66 in decemeber and at full retirement age. When does he have to suspend, can it be anytime in the month of december once he reaches the full retirement age or does it have to be the day he turns 66 which is on the weekend.

    Ty for your help,

    Suzy

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Suzy -

    If your husband is at Full Retirement Age he is allowed to suspend and the benefits for dependents will continue. The rule has not changed.

    jb

  • Suzy

    Hi Jim this is Suzy again, I wrote you about one month ago,

    Well my husband and I went to the SSA office yesterday to file for his benefits. I asked if he filed then decided to suspend would the children continue to receive there dependent benefits the represetative told me absolutely not. She said the moment my husbands benefits stopped the kids would stop as well. This is not what I have been hearing, do you know if the rule has changed.

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Michael (not sure if you’re the same Micheal as before, so I’m answering separately):

    Your children could receive benefits until age 18 (or 19 if still in high school) if you have filed. Unfortunately at the age of 62 if you file now you’ll permanently reduce your retirement benefit. I would imagine that the long-term benefit of delaying to your FRA will outweigh the short-term benefit of your children’s receiving the dependent benefit, but you’d probably want to put a pencil to the figures to make sure.

    jb

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Micheal -

    Regarding Medicare and SS benefits, these are separate activities. Back in the olden days, when FRA was 65 the two went pretty much hand-in-hand, but were actually two separate activities. Now with FRA after 65, many folks don’t realize that Medicare is available before their full benefit age for Social Security.

    Hope this helps-

    jb

  • Michael

    Good morning Jim,
    I’m 62 and want to wait until FRA to file. However, right now my two kids are 17 and 15 and I think they can also receive benefits until they graduate. If I don’t file now I will lose their eligibility. What is your opinion on this? Thanks

  • Suzy

    Thank you so much Jim, you answered my question that i have been wondering about for months. Again thank you.

  • Michael

    Thanks for the response. So, will I have to file for SS benefits before I sign up for Medicare or is that totally separate? Have a good evening.

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Hello, Michael.

    Medicare eligibility begins at age 65, so you would not be allowed to sign up for it until that age.

    jb

  • Michael

    Hi Jim,
    Can you explain how Medicare fits into all this. I’m 62 and would be interested in signing up for Medicare only. Is that possible? Thanks in advance for your help.

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Hi Suzy.

    Yes, this is true, your husband can file and suspend once he reaches Full Retirement Age, so that your children can begin receiving dependent’s benefits, and his benefit will continue to accrue delayed retirement credits up to age 70.

    This has no effect on your Social Security disability, and would have no effect on your retirement amount as well. Once you file for retirement benefits, if your PIA amount is less than half of your husband’s PIA, you would be eligible for a spousal benefit as well.

    Hope this helps -

    jb

  • Suzy

    My husband is 65, he is 66 in decemember we have been told to have him file and suspend his benefits so our children 3, 3 and 5 would begin to receive benefits, I can not find any info on the SSA website regarding this is this information true. I am currently recieving social security disability, would this affect my money, my future retirement benefits.

  • Bruce

    Thank you, Jim. Very helpful.

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Bruce -

    The wife must be receiving benefits based upon HER record, not the husband’s record, because until he files, she is not eligible to receive benefits based on his record. Since they’re under FRA, he couldn’t have filed and suspended, so she can only be receiving benefits based on HER record.

    If the husband were to file and suspend at FRA, then the wife would be eligible for an increase in her overall benefit using the formula of 50% of the husband’s PIA minus the wife’s PIA (not her benefit, her PIA). Whatever that difference is will be added to her current benefit.

    Hope this helps -

    jb

  • Bruce

    Jim,

    Wife and husband are about the same age, 64. Wife is already receiving SS benefits based upon husband’s record although he is still working and is not receiving benefits now.
    FRA is 66 for both.
    I understand husband could file and suspend at age 66 and then wife’s benefits would be increased to reflect one-half of the higher PIA at the FRA.
    Am I interpreting the rules correctly? Husband won’t fully retire until age 67 or 68.
    Thank you.

    BEB

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Hello Rebecca -

    The only reason for you to File and Suspend is if you have a spouse or dependents that would qualify for benefits based upon your record.

    If there is no one to apply for benefits based upon your retirement benefit record, there’s no reason for you to file and suspend – just continue delaying to age 70.

    jb

  • Rebecca

    Hi Jim,

    I will be 64 in March of 2012. I am currently working.

    If I want to wait to collect Social Security until age 70, do I have to file and suspend at age 66?

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Stan -

    Yes, that’s correct.

    PIA stands for Primary Insurance Amount, which is roughly equal to your benefit at exactly FRA (or in this case, you’re wife’s benefit were she to delay to FRA to file). It’s the base amount against which your reduction or increase factors are applied to come up with your actual benefit.

    You can find more on the PIA by looking at the article Primary Insurance Amount.

    Hope this helps -

    jb

  • Stan

    Jim, thanks for your response. So if I read it right she files at 62 and at the same time I apply for a spousal benefit which would be half of her $1200. I continue to work and contribute until I have to claim at 70 continuing to increase my delayed benefit by 8% a year for 3 more years. BTW what does PIA stand for?

    Thanks,

    Stan

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Hi Stan -

    You’ve got a couple of rules mixed together. There are two things that you have to wait until FRA to do. The first is to File and Suspend. And the second is to file for Spousal Benefits only (not retirement benefits).

    So, in the situation you’ve described, if your wife began receiving Spousal Benefits at age 62, she also must receive her retirement benefit at the same time due to deemed filing. So if her retirement benefit is greater than half of your PIA, she would get no spousal benefit at all.

    But the glass is still half full for you. If she can’t receive a Spousal Benefit because her retirement benefit is too large, since you’re at FRA or older you could file for a Spousal Benefit alone equal to half of your wife’s PIA – while your retirement benefit continues to accrue Delayed Retirement Credits. In this case you would NOT file and suspend, that would take you out of contention for the Spousal Benefit alone strategy.

    Hope this helps -

    jb

  • Stan

    Hi Jim,

    I’m still working at 67 and plan to keep working till at least 70. My wife is not and will be 62 in 2/12. Since she is unlikely to return to work she is planning on collecting as of 62. If I file and suspend at that time she could claim spousal benefits. However she would collect about $400 less a month than if she just claimed on her own. I thoufht if she did this and her benefits continued to acrue until she was 64 we would come out ahead in the long run. But from what I read it appears her benefits would not continue to accrue as if she hadn’t retired. Am I right in this? Also would my benefits not increase at the 8% rate as well while she was collecting spousal benefits?

    Thanks

    Stan

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Cindy,

    If your husband is planning to delay receiving his benefits past FRA, then you’ll want to decide which method would bring you the highest benefit: 1) your husband files for Spousal Benefits only when he reaches FRA; or 2) he files and suspends, allowing you to file for the Spousal Benefit. Usually #2 works out best, but it depends on how much each of your benefits are presently.

    Hope this helps -

    jb

  • Cindy

    I am 62 and have filed for my SS benefits. I am the lower wage earner. My husband, who is 64, is going to delay filing until FRA of 66 or later. He plans to retire the end of this year. Can we use the File and Suspend option in any way to our advantage?

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Jane -

    Since your husband is over Full Retirement Age, he is eligible to suspend after filing – this doesn’t seem to be in question from your comment above.

    You are correct in that you should still be able to continue Spousal Benefits if he suspends, and you can direct the SSA folks to the POMS system, GN 02409.110, #2 in the list, which reads:

    The decision to voluntarily suspend retirement benefits applies only to the numberholder. Do not adjust benefits to other beneficiaries on the record.

    Hope this helps -

    jb

  • Jane

    I still don’t understand. I called SS and they said that my husband could not file and suspend.. that if he signs up for his benefits, and I seek spousal benefits and then he withdraws/suspends them, the spousal benefits would be canceled also.

    He is 67 and I am 66. From what I was reading online I thought he could file and I would seek the spousal benefit, then he would suspend, and I would keep getting the spousal benefit, meanwhile letting both of our benefits grow until we each reach 70. At 70 we would both start taking our maximum benefits.

    This seems too good to be true.. so I have a feeling I have misunderstood something. Please explain.. and if it is true, how do I explain it to SS?

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Hi, Sam.

    There would be no benefit to filing prior to your age 70 since your wife is 10 years younger and therefore not eligible for Spousal benefits – the earliest she could receive a reduced benefit would be at her age 62, your age 72.

    Hope this helps -

    jb

  • Sam

    Jim,

    I will be at FRA in a few months. My wife is 10 years younger. She will not be filing for a spousal benefit before I reach 70 and am eligible for the maximum benefit.

    Is there any reason/advantage to apply for benefits at FRA and suspend instead of just filing at age 70?

    Thanks in advance,
    Sam

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Maureen -

    Thank you for your patience. This question was more complicated than it seems… and I needed to call upon my resources at the SSA to help out.

    It turns out that your fiance can suspend at FRA, even though he has already been collecting for several years. The Delayed Retirement Credits (DRCs) will be factored against his reduced benefit, but should still provide some increase to the overall benefit when he files again.

    Otherwise, I don’t know of another way to withdraw from the program at this stage.

    Hope this helps -

    jb

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Art -

    Reference is in POMS: https://secure.ssa.gov/apps10/poms.nsf/lnx/0202409110

    2. Voluntary Suspension Applies Only To The Numberholder’s Own Benefits

    The decision to voluntarily suspend retirement benefits applies only to the numberholder. Do not adjust benefits to other beneficiaries on the record.

    Hope this helps -

    jb

  • Art

    Dear Jim,
    In the 2nd paragraph you make the statement, ‘Other eligible dependents (such as children under 18) can also receive benefits based upon the filed and suspended record
    ‘. Can you provide a reference in the Social Security benefits law that states the above? I am trying to apply for this payment for my 16 y.o. daughter, when I apply for and suspend benefits in October when turning age 66. I can cite laws that allow spousal payment, but cannot find anything that says children under 18 are eligible for payments. Please advise. The Social Security Claims worker says payment are not allowed to under 18 y.o. children if you suspend payments to yourself. Thanks.

  • maureen byrnes

    I really need your help and advice! My fiance made the mistake of filing at age 62 and began receiving benefits. We have discussed how this would negatively impact our future retirement. However, it has been 2 years since he filed and so can no longer withdraw. Have we any way to stop the checks now, at all? If not, I have wondered if he could suspend at age 66 through 70 to help correct this shortfall. I cannot find anything online to help me. Is it possible to suspend after receiving benefits for 4 years? I understand that you have to be full retirement age to suspend, but can’t find mention if it’s possible to do after receiving benefits.

  • maureen byrnes

    I really need your help and advice! My fiance made the mistake of filing at age 62 and began receiving benefits. We have discussed how this would negatively impact our future retirement. However, it has been 2.5 year since he filed and so can no longer withdraw. Have we any way to stop the checks now, at all? If not, I have wondered if he could suspend at age 66 through 70 to help correct this shortfall. I cannot find anything online to help me. Is it possible to suspend after receiving benefits for 4 years? I understand that you have to be full retirement age to suspend, but can’t find mention if it’s possible to do after receiving benefits.

  • http://www.bfponline.com/ Jim Blankenship, CFP®, EA

    Bill,

    Spousal Benefits do not impact the worker’s benefit. The spouse (in your example) can begin collecting the Spousal Benefit as soon as the worker (you) file and suspend at FRA. Since you’re not collecting your benefit, it can continue to accrue delayed retirement credits up to your age 70.

    If your wife is under FRA when she begins collecting the Spousal Benefit her benefit amount will be reduced, depending upon how much before FRA she begins taking it (at least age 62). There is also no increase in the Spousal Benefit if she delays applying for it after her own FRA.

    Hope this helps -

    jb

  • bill

    Jim,

    Suppose my wife has not worked outside the home at all or, in other words, has accrued no credits towards ss benefits. If I, the worker, file and suspend at 66(I’m currently 64 years old) can my wife actually collect benefits without penalizing my own when I go to collect at 66?