How to Increase your Spousal Social Security Benefit

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As we get closer to retirement, it’s important to have a solid plan in place. One of the strategies that can make a real difference is spousal Social Security benefits, which are often overlooked or misunderstood. For couples going through this stage, knowing how to get the most out of these benefits can really improve your quality of life in retirement. Let's dive into how a thoughtful, strategic approach can help you make the most of what Social Security offers for spouses. I mean, c'mon, we've paid into these benefits all of our lives, might as well aim to get the most out of them.

The spousal benefit is a unique financial resource that was originally meant to support families when most households had just one breadwinner. Even today, with both spouses often working, the spousal benefit still plays a key role in protecting the lower-earning spouse. If used well, it can add real value to your retirement plan.

Understand the Basics—But Don’t Stop There

First things first: the spousal benefit allows you to claim up to 50% of your spouse's primary insurance amount (PIA) if that amount is higher than what you would receive based on your own earnings record. While this sounds straightforward, there are subtleties that make all the difference—details often glossed over in brochures and boilerplate online articles.

For instance, one of the critical misunderstandings is assuming that you simply get half of your spouse’s benefit. In truth, your spousal benefit is calculated by first providing you with your own earned benefit and then supplementing it to reach the equivalent of half of your spouse’s PIA. This nuanced calculation means that if you have a work history, your total benefit might be a combination of your own earnings plus an additional “top-up” to meet the spousal amount. That distinction is subtle, but it's essential in fully understanding what you’re entitled to and how much you can plan around it.

Timing is Everything—Full Retirement Age Matters

One of the most powerful levers in this strategy—one that is often underappreciated—is the timing of when you file. You might have heard that waiting until Full Retirement Age (FRA) is a good idea to maximize your benefits, and this holds especially true for spousal benefits. Filing before your FRA can result in a permanent reduction of your benefit. Unlike the primary worker’s benefit, which can continue to grow through delayed retirement credits until age 70, the spousal benefit caps at FRA make timing all the more critical.

It’s akin to setting off fireworks on the Fourth of July—you don’t want to jump the gun and have a diminished show, and you don’t gain anything by waiting past the right moment. In Social Security terms, that "right moment" is FRA for spousal benefits. Knowing exactly when to claim can mean the difference between a modest boost and a substantial addition to your income stream.

No File, No Pay—The Dependency Clause

Another essential, often overlooked, element is that your spousal benefit hinges on your partner filing for their own benefit. This is where your household’s retirement strategy needs a coordinated approach. Picture it like a tandem bike ride—both riders need to be pedaling in sync for the journey to be smooth. If your spouse decides to delay their own benefits until age 70 for the increased monthly income, you’ll have to wait to collect a spousal benefit until they do so. This can be a good move in certain scenarios, but it’s important to be aware of how this impacts your overall retirement cash flow.

Previously, strategies like "file and suspend" allowed more flexibility here, but changes to Social Security rules in 2016 largely did away with those options. Now, both spouses must align their plans more closely to ensure the greatest possible benefit.

Survivor Benefits—A Strategic Perspective

It’s easy to think of Social Security purely in terms of income during our golden years, but the importance of survivor benefits adds a deeper layer of complexity—and opportunity—to strategic planning. While spousal benefits themselves don’t accrue delayed retirement credits, survivor benefits do. This means that if the higher-earning spouse delays claiming until age 70, they leave behind a more substantial benefit for their surviving partner.

This is especially important for couples where one spouse has significantly lower lifetime earnings. It’s not just about maximizing income while both are alive—it’s about ensuring that, in the event of one partner passing away, the survivor maintains financial security. Planning for survivor benefits is not just a financial strategy; it's an emotional one as well, reflecting care for a partner's well-being even after we’re gone.

Maximize the Impact—It’s Not Just About the Numbers

Often, the conversation around Social Security revolves around numbers—what’s the biggest monthly check you can get? But I encourage you to consider not just the size of the check, but its purpose. How does this fit into your broader retirement strategy? Would delaying one spouse’s benefits allow you to leverage other investments earlier, perhaps offering greater growth potential overall? Does optimizing for survivor benefits give you peace of mind, knowing your partner will be taken care of?

Wrapping It Up—Act with Intention

The decisions you make regarding Social Security are some of the most important ones in your retirement planning. Spousal benefits, in particular, take careful coordination and a good understanding of the rules. It’s not just about getting the biggest check possible—it’s about making sure you and your partner are financially secure and making decisions that support your goals. As you approach this stage, remember that every decision matters. Make sure you’re making choices with a clear purpose and understanding of how they impact your future.

Social Security is just one part of your retirement plan, but when used wisely, it can bring everything together and provide stability. Don’t leave potential benefits on the table.

Understand your options, strategize with your partner, and make sure you’re getting the most out of the system. If you’re unsure about the best approach, we’re here to help. At our wealth management firm, we specialize in helping individuals plan for early retirement and make the most of Social Security. Reach out to us to discuss your situation—after all, you've worked hard for these benefits, now let’s make them work for you.