Social Security Matters:

Dear Rusty:  I have heard many different answers on this but there are so many scenarios I can’t seem to find an answer to mine. My wife and I were both born in 1959 and we both turn 60 next year. Both of us will be eligible for Social Security based on our work records to date, but my SS benefit is much larger than hers. Scenario: Say we both retire from work at 60. For simplicity let’s say neither of us works in retirement, my wife claims Social Security at age 62 and I claim at my full retirement age of 66 plus 10 months. What will her spousal benefit be, as a percentage of my benefit, when she starts receiving it when I claim at my full retirement age?  Signed:  Planning Ahead

Dear Planning:  A spouse claiming benefits at full retirement age (FRA) can get 50 percent of the higher earning spouse’s FRA benefit, if that amount is more than she is entitled to on her own record. But if your wife claims her own Social Security retirement benefit early at age 62, her spousal benefit will be reduced even if it starts at her full retirement age. The reason is that her total spousal benefit will be the sum of her own age 62 benefit plus a “spousal boost” computed from both of your FRA benefit amounts - the spousal boost will be the difference between your wife’s own FRA benefit amount and ½ of your FRA benefit amount.  

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