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Social Security: Can I File at 62 and Switch to Spousal Benefits Later?
Social Security is a vital component of the retirement income for many Americans. It provides a financial safety net that ensures a basic level of support during the golden years. Understanding the rules and options available under Social Security is crucial, especially when it comes to maximizing your benefits. One common question that arises is whether it’s possible to file for benefits at 62 and switch to spousal benefits later. Let’s delve into this topic and shed some light on the nuances involved.
Firstly, it’s essential to comprehend the concept of full retirement age (FRA). FRA is the age at which you are entitled to receive the full benefits based on your earnings record. For those born in 1960 or later, the FRA is 67, while for those born earlier, it ranges between 65 and 66. Filing for benefits before reaching your FRA results in a reduced monthly payout. For instance, if your FRA is 67 and you file at 62, your benefits will be approximately 30% less than if you waited until your FRA.
Now, let’s discuss spousal benefits. Spousal benefits are available to individuals who are married to someone eligible for Social Security benefits. If you have been married for at least one year, you can claim a spousal benefit equal to 50% of your spouse’s full retirement amount. Importantly, claiming spousal benefits does not affect the primary worker’s benefit amount. This means, by filing for spousal benefits, you’re not reducing what your spouse will receive.
The great news is that if you are eligible for both retirement and spousal benefits, you can choose to file a restricted application. By filing a restricted application, you can restrict your claim to only spousal benefits, allowing your own benefits to accumulate delayed retirement credits. Delayed retirement credits increase your benefit amount for each year beyond your FRA that you delay filing, up until the age of 70.
Now, back to the main question. Can you file at 62 and switch to spousal benefits later? The answer is yes, but there are a few limitations to consider. Firstly, you can only file for spousal benefits once your spouse has already filed for their own retirement benefits. Secondly, you must have reached your FRA. If you file for spousal benefits early, your benefit will be reduced, just like filing for retirement benefits early.
To illustrate, let’s imagine you are eligible for a retirement benefit of $1,000 at your FRA of 67. You decide to file for retirement benefits at 62, resulting in a reduced monthly benefit of around $700. When your spouse files for their retirement benefits at, say, 66, you become eligible for a spousal benefit of $500 (50% of their full retirement amount). However, since you didn’t wait until your FRA to file for retirement benefits, the 30% reduction applies. This means your spousal benefit would be reduced to approximately $350.
In summary, you can file for Social Security benefits at 62 and switch to spousal benefits later, but several factors need consideration. Waiting until your FRA to file for the spousal benefit will result in a higher payment. Additionally, if you file for any benefits early, your monthly amount will be permanently reduced. Understanding these intricacies, seeking guidance from a reputable financial advisor, and considering your unique circumstances will help you make a well-informed decision about when to file for Social Security benefits. After all, it’s all about ensuring a secure and comfortable retirement.
So if my wife starts taking benefits at age 62 of $700 a month and I wait until 65 and get $1900, we were both born in 1963, how much will she get then if she switched to spousal benefits?
This calculation is one I have puzzled over for a while. My wife took SS at 62. I will take it at 69.5 but my wife at that time will be almost a year away from FRA. I believe she will automatically get the spousal benefit once I retire but what I don’t know is will the amount from my earnings added to hers be reduced since she files before her FRA? Hope that makes sense.
You first have to determine what is the PIA for both spouses at FRA. If you were born from 1960 onward that is 67 years of age. That and your earning history determines the dollar amount. If one spouse gets the maximum 3600 a month SS at 67 and the other spouse gets only 1400 at 67. The spouse with the lower SS income gets their amount, in this example 1400, or half of the higher earning spouse which would be 1800. Whichever amount is higher but you don’t get both. Their 1400 earned amount PLUS 400 from the higher earning spouse for a total of 1800. However, if the lower earning spouse takes SS at 62 and receives a reduced amount, say 1000 a month instead of 1400 at FRA. They can apply for spousal benefits at their FRA and get that original 400 added on to their reduced benefit taken at 62. In this case 1000 +400 for a total of 1400. They do not qualify for 1800 or half their spouses benefit because they took their own benefit early. You cannot draw off your higher earning spouse unless they are drawing SS. And you don’t get half of what they draw at 70. It’s only their PIA at FRA. That’s either 66 and some months born before 1960 and 67 born after.
Great video! My wife wants to retire at 62 but I will keep working. As married filing jointly, I assume my earnings will penalize her social security amount if I earn over the annual earnings limit? Is it different if we file married filing separately?
So…my wife has taken benefits early and receives $1100. I will retire at full retirement age and my PIA will be $3200…take half of my $3200 ($1600) and that means she will receive not the $1100 she currently gets and instead get $1600 ???
Josh, thanks for the confirmation. My wife is 6 years older than me and has taken her benefits early. When I file at my FRA she should see a sizable spousal benefit increase due to my larger PIA.
Josh my wife is 4yrs older then me. So if she files at 62 then switch to mine when I reach FRA at 67. She will move up to 50% of mine. Sure appreciate these videos