Unlocking the Secrets

of Social Security
Mary Beth Franklin

National Press Foundation

Washington, D.C.
June 9, 2015

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Timing is Everything
Knowing when and how to claim
Social Security benefits can
boost
your retirement income by tens
of thousands of dollars
over your lifetime.
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For
Married
Couples
The right
Social Security
claiming
strategy can
mean the
difference of
$100,000 or
more over your
joint lifetimes.
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For Singles
Your choice when
to begin Social
Security benefits
depends on your
health, finances
and whether you
plan to continue
working. But if you
are divorced or
widowed, you may
have additional
claiming options.
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Your Age Matters

You can collect retirement benefits as early
as 62, but they will be reduced by 25% or
more for the rest of your life.
If you wait until your normal retirement age,
currently 66, you can collect your full
retirement benefit even if you continue to
work.
Or, if you delay collecting benefits beyond
your normal retirement age, you can
increase the amount by 8% per year up to
age 70.
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Whats Your Number?

Birth Year

Full Retirement
Age

Benefit Reduction
at 62

1943 1954

66

25.00%

1955

66 and 2 months

25.83%

1956

66 and 4 months

26.67%

1957

66 and 6 months

27.50%

1958

66 and 8 months

28.33%

1959

66 and 10 months

29.17%

1960 and later

67

30.00%

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Why 66 is the Magic Age

If you wait until 66* to claim Social Security,
you can:
--Collect full retirement benefits
--Exercise some creative
claiming strategies
--And, avoid losing benefits
to earnings cap restrictions.
*If your normal retirement age is higher, so
is your magic age.
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Earnings Cap
Rules

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If you collect
Social Security
benefits before
your normal
retirement age
and continue to
work, you will
lose $1 in
benefits for
every $2 you
earn over the

Lesson #1

If you plan to keep working, in

most cases it makes no sense to
claim reduced retirement
benefits before your normal
retirement age.

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Exceptions:
Collect Social Security benefits
early if:
You really need the money
and are no longer working or
earn less than the earnings
cap.
Or, if youre in poor health
and may not live until your

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Married couples have more

flexibility.
Sometimes it makes sense for
the lower-earning spouse to
collect benefits early, assuming
she is no longer working or
subject to the earnings cap.

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Coordinating Benefits
In most cases, it makes sense for the higher
earning spouse to delay benefits as long as
possible, up to age 70, to lock in the
maximum retirement benefit as well as the
largest survivor benefit should he die first.
The lower earning spouse may want to
claim reduced benefits early at 62,
assuming she or he is no longer working.
But theres room for a little magic in
between.
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Spousal benefits = 50% of workers benefit at

66
Survivor benefits = 100% of workers benefit at
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66

Magic Strategies to
Boost Benefits

File and Suspend--Triggers benefits for

a spouse but allows worker to delay
collecting his or her own benefit.
Restrict claim to spousal benefit
onlyLets you collect only your spousal
benefit while deferring your own
retirement.
To exercise these magic strategies,
you must wait until 66 or later to first
claim benefits.
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Bonus for Waiting

You earn 8% for every year you
delay claiming Social Security
retirement benefits beyond your
normal retirement age up to age 70.

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Who Collects Delayed

Retirement Credits?
The 8%-per-year increase in benefits
between ages 66 and 70 applies only to
the workers retirement benefit. It does
not apply to a spousal benefit.
But if he dies first, her survivor benefits
are equal to 100% of what he received
during his lifeincluding delayed
retirement credits.
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Lesson #2
Creating the largest possible
benefit for the surviving
spouse should be the main
goal for most married couples.

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Survivors Can Switch

Benefits
Widows and widowers can collect survivor
benefits as early as age 60, but are subject
to benefit reductions and the earnings cap
if they continue to work.
They can collect survivor benefitsequal
to 100% of the deceased spouses benefit
initiallyand then switch to their own
benefit that continues to grow at 8% per
year until age 70.
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Collect on Your Ex
As long as you were married at
least 10 years,
And are not currently married,
You may be able to collect on
your ex-spouses work history as
early as age 62.

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Better strategy for exspouses

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Wait until 66 and you

can restrict your
claim to spousal
benefits only,
collecting half of your
exs full benefit and
delay collecting your
own until it is worth
the maximum amount
at age 70.

Do-over strategy
If you claim benefits early and then
change your mind, you have a once-in-alifetime chance to suspend your benefits
within 12 months of first claiming them,
repay what you have
received and restart
your higher benefits
at a later date.
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Back-up Plan
If you miss that initial 12-month window,
theres another option. Wait until 66 and
you can voluntarily suspend
your benefitsbut not repay
them and earn 8%
per-year in delayed
retirement credits up
to age 70.
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Dont forget the Kids

If you are collecting retirement benefits and you have minor
dependent children at home, they are eligible for benefits, tooup to
half of your benefit amount.

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