I am 60 and I was divorced from my husband in 2000 after 15 years of marriage. Neither of us remarried and he died in 2010 at the age of 55. My income is about $50k a year and I'd like to maximize my benefits. I plan on working as long as possible. What do you suggest I do? Thanks for your time.

Dear Madam,

You are eligible for widows benefits starting right now, but they will a) be reduced and b) be subject to the Earnings Test. Still, if you don't earn enough to lose all your widows benefits, it might be best to file for them now if your own benefit at age 70 (or the age at which you start collecting your own retirement benefit) exceeds your reduced widow benefit. Also, the lose of widows benefits due to the earnings test will be undone to some extent when you reach full retirement age. At that point, they will bump up your monthly widows benefit in light of all the widows benefits you lost due to the earnings test. However, that won't fully offset the earnings test since once you take your own retirement benefit, assuming its larger than your widows benefit, you'll just get your retirement benefit, i.e., the widows benefit, including the bump up, will, at that point, be gone.

Another option is to take your own retirement benefit early, as early as 62, and wait till your full retirement age to take your widows benefit. Which of these two options is best in light of the earnings test is not something you remotely want to try to sort out on your own.

Please use our Maximize My Social Security software at www.maximizemysocialsecurity.com. It's costs very little, is extremely accurate, and will handle all aspects of the earnings test as well as widow and retirement benefits. In a couple of minutes it will go through the tens of thousands of alternative collection strategies you face and find the one that generates the highest lifetime benefits. And it will do so fully incorporating the earnings test. You can also use the program to consider working longer and see what the payoff from doing that will be. Given the earnings test, it may not, at some point pay much to work longer relative to taking either your retirement or widows benefit. I.e., the earnings test can represent a hidden massive tax on working. So please do run our software.

My best, Larry