Social Security Claiming Strategies for Married Couples
By carefully planning the timing of Social Security claims, married couples can enhance their financial stability in retirement.
Common Strategy for Married Couples
A common strategy is for the higher earner to delay claiming until age 70 and the lower earner to claim earlier.
Delay the Higher Earner’s Claim Until Age 70
The higher-earning spouse may want to wait until age 70 to begin collecting Social Security benefits. This delay increases the monthly benefit by approximately 8% per year due to delayed retirement credits. Additionally, this approach boosts the survivor benefit, providing greater financial security for the surviving spouse.
Claim Early for the Lower Earner
The lower-earning spouse may benefit from claiming Social Security benefits earlier. This strategy provides immediate income while allowing the higher earner's benefits to grow. Once the higher earner reaches age 70, the lower earner can switch to a spousal benefit if it's higher than their own.
Life Expectancy and Actuarial Math
This strategy is based upon the actuarial math and the way the Survivor Benefit works. Once one spouse dies, the survivor generally receives the larger of the two benefit amounts and the smaller amount goes away. When higher earner delays their benefit, it increases the household benefit (and income) for as long as either person is alive (i.e., until both people have died).
The higher earner delaying their benefit has a greater impact on the total lifetime Social Security benefit for the household because the while either person is alive, which is a longer period of time than while both people are alive, so one spouse delaying increases the household income for a longer time.
When the lower earner delays, it increases the household benefit for as long as both people are alive (i.e., until one person has died). Once one spouse passes, the impact of delaying the lower benefit is no longer relevant.
Because there is approximately a 75% chance that at least one person dies before reaching life expectancy, the lower earner delaying their benefit is less impactful.
Exceptions
There is a minor/adult-disabled child in the household
The lower earner is still working
Both spouses are in very poor health
Both spouses are in very good health or concerned about longevity
There is a large age gap between spouses
Tax planning and Roth conversions
Using the Boldin Planner
Utilizing Boldin can aid in making informed decisions around Social Security claiming tailored to your individual circumstances.
Use the Social Security Explorer to see the impact of different claiming dates and longevity dates on your lifetime benefits.
Create scenarios with different claiming strategies to view the impact of different claiming dates on your estate value, lifetime taxes, portfolio longevity and more.