Which Plan Is Our Best Long Term Strategy?

Oct 8 2019 - 3:34pm

Which plan gives us the best long-term strategy as a couple?

Slight twist to an earlier question on the best claiming strategy for our situation:
I haven't been able to get an answer from Social Security yet!

Both healthy - expect to live into mid-eighties or later. Strong investments; don't need the social security money for living expenses. We plan to invest the money.

Possible plans:
Strategy # 1
1. Husband will turn 65 on Dec. 2, 2019 and applies for Social Security based on his work record, receiving about $390 per month in reduced benefits.
2. I am currently 66 FRA as of August 1, 2019. Following my husband’s application for his benefits, I plan to file a restricted application for spousal benefits, making it clear that my application is restricted to spousal benefits. (I am not applying for my retirement benefits on my own record, because I want to earn delayed retirement credits.) I should get one-half ($195) of my husband’s reduced benefit at his age 65. This should result in a combined Social Security income for the two of us of $585 per month for the 4 year period leading up to my 70th birthday.
3. At age 70, I apply for Social Security benefits on my own work record and receive a monthly benefit of approximately $2,400.
4. Following my application at age 70 for my benefits, my husband applies for spousal benefits based on my work record. His total monthly amount would then be one-half of my approx. $1,800 age 66 FRA amount, or $900. (Social Security will calculate $390 from his social security individual record and $510 ($900 - 390) from my work record.) This should result in combined Social Security income for the two of us after I turn 70 of $3,300 per month ($2,400 + $900).
Question - Will the reduced rate my husband takes by claiming at age 65 affect the total amount of benefit he can claim as a spouse later on? Would there be any argument in favor of waiting to file this strategy until he turns 66 (his FRA). We do not plan on earned income during this year, but will have real estate and investment income.

Strategy #2
I file for my FRA benefits now at age 66 (approx. $1,800) and my husband files for his spousal benefit.
Would his amount be less at his claiming age of 65 as opposed to waiting until I am 67 and he is 66 (FRA).
Again, we are planning to invest the money; looking at the best strategy. I understand that this strategy would leave him with a lower widower benefit, should I predecease him. It’s probably not our first choice.

Thanks for sharing your perspective,


Hi Mira,

I would say strategy #1 is the better of the two given your expectations about the future. However, which strategy would actually work out best depends on how long you and your husband live and how your investments work out. Also, some of your calculations are inaccurate.

First of all, if you file a restricted application for spousal benefits only at full retirement age (FRA) or later, your spousal rate would be equal to 50% of your husband's primary insurance amount (PIA), not 50% of his reduced rate. A person's PIA is equal to their Social Security retirement benefit rate if they start drawing benefits at FRA.

Also, if your husband files for reduced retirement benefits and then qualifies for additional spousal benefits at his FRA or later he won't receive a full 50% of your PIA. His unreduced excess spousal rate would be calculated by subtracting his PIA from 50% of your PIA, which would then be added to his reduced retirement rate. So, he'd retain the reduction amount that he took to start his own benefits early.

Finally, if you file for your benefits at FRA and your husband files for benefits prior to FRA both his own retirement benefits and his excess spousal rate will be reduced for age. You and your husband should strongly consider using our software (https://maximizemysocialsecurity.com/purchase) to help you with your decision. The software would allow you to compare any and all possible filing strategies so that you can base your decision on accurate calculations.

Best, Jerry