Social Security spousal benefits allow a lower-earning spouse to claim up to 50% of the higher earner's Primary Insurance Amount (PIA) at full retirement age. Despite this substantial benefit, SSA data shows the majority of couples leave $50,000 to $250,000 in lifetime benefits on the table by claiming both benefits at age 62.
The claiming decision is permanent and irreversible. Claiming spousal benefits at 62 results in a 30-35% permanent reduction. Critically, spousal benefits do NOT earn delayed retirement credits past full retirement age, unlike worker benefits, there is no incentive to delay spousal claims beyond FRA.
Optimal strategies include having the higher earner delay to age 70 (increasing their benefit by 24-32% and the eventual survivor benefit) while the lower earner claims at FRA. Divorced spouses married 10+ years can claim on an ex-spouse's record without reducing the ex's benefit, a provision many eligible recipients never discover.
-Rocky
#SocialSecurity #SpousalBenefits #RetirementPlanning #EngineeringDreams #StrategiaX
Originally published on WealthWise OS.