INTRO: How would you like to boost your benefits from Social Security? For married couples, there's a valuable technique that most couples have no idea is available. But here on Golden Opportunities, we want you to be able to make the most of your money.
1. ARE MARRIED COUPLES LOSING OUT ON SOCIAL SECURITY BENEFITS?
A. Yes, many of them are. Especially when both spouses have worked. Each person may be entitled to benefits under their own work records, or under a spouse's, and many times they fail to collect the most they could.
2. WHY IS THAT?
A. When you retire after working, you are entitled to benefits under your own work record. If your spouse worked, he has his own work record for benefits.
So the husband has a benefit of his own, and the wife has a benefit of her own.
Here's where it gets more complicated. You can collect on your record or on your spouse's record. A spouse benefit could be higher or lower than your own benefit.
Most people look at the two benefits and take the higher. But sometimes, that's not the smartest thing to do.
Sometimes, it's best to take less for a while, then switch to get more for life.
It's the "wait and switch" strategy.
3. CAN YOU GIVE US AN EXAMPLE?
A. Sure. This is a true story, with the identifying details changed.
Bob intends to keep working for a while longer. His wife, Mary, has retired. Both have reached their full retirement age of 65 and several months.
Mary started taking her benefits of $1000/month. And Bob could have taken his benefits of about $1200/month; together they'd get $2200/month. And since Bob's working, they'd pay a hefty tax. So they decided to use the wait and switch technique.
Bob delayed starting his benefits. It he waits to start his benefits until he reaches age 70, he'll get a big raise when he starts later.
But Bob shouldn't get nothing. So he started taking a spousal benefit of $500/month based on Mary's benefits. Together they get $1500 monthly, less than if Bob took his own benefits.
When Bob reaches 70, then he'll switch to his own Social Security benefits, which at that time will be almost a third higher, or in Bob's case about $1600/month. Together they'll get $2600 monthly. In a relatively short time, they will have more than made up the difference and will come out way ahead over the years.
4. DOES THIS WORK FOR EVERYONE?
A. No. But there are a number of little known strategies for married couples which may allow them to increase their Social Security benefits.
Social Security has a good website, www.ssa.gov. It has lots of information. But it doesn't really help explain how to enhance your benefits. For that, you'll probably need to talk to an elder law attorney.
CLOSE: Would you like to boost your benefits? There may be a way, under Social Security.