What do I get the most mail about? Winner by a mile is the question of when to file for spousal (or divorced spousal) benefits. Lots of you misunderstand the rules, with the result that you're leaving money on the table.
So here is your guide to spousal benefits. I'm writing from the point of view of a wife filing on her husband's earnings record, but the same rules apply to either spouse.
First, what is a spousal benefit?
It's a payment originally designed for women who left the workforce to raise children. You need 10 years of work (40 quarters) to claim a retirement benefit of your own. If you worked less (or not at all), or your earnings were very low, you can get a spousal benefit based on the earnings of your husband.
How much is the spousal benefit?
It depends on your age when you claim it. If you wait until your full retirement age (somewhere between 66 and 67), you'll get half of what your husband could get at his own full retirement age. If you claim earlier, you'll receive less.
What if you worked 10-plus years and earned a Social Security retirement benefit of your own?
Here's where claiming gets tricky. If your husband has not retired, you can file for a benefit based on your personal earnings. When he finally quits work and goes on Social Security, the spousal amount you can receive depends on your personal benefit's size. If it's higher than what you'd get as a spouse, you'll continue to receive that same, higher amount, says Philip Moeller, coauthor of Get What's Yours: The Secrets to Maxing Out Your Social Security. If your personal benefit is smaller, it will be topped up to the spousal level.
If you file when your husband has already retired, Social Security will normally assume that you're claiming your personal and your potential spousal benefit at the same time. You will receive the higher of the two.
There's an exception for people who were born on or before Jan. 1, 1954. If you put off your claim until full retirement age, you can file a "restricted application" for a benefit based on your spouse's earnings, without also claiming the personal benefit you're owed. At age 70, you can switch to your personal benefit, which will have grown at 8 percent per year plus the inflation rate.
What if you're divorced?
You get the same benefits as a current spouse, if your marriage lasted at least 10 years and you are now single. Also, you can claim the spousal benefit even if your ex has not retired, provided that he is eligible for benefits and you have been divorced for at least two years. If you've been working, however, you will probably find that sticking with your own benefit is the better deal.
Special rules cover the disabled or retirees with children who are under 18. But for most of you, this road map works.
Jane Bryant Quinn is a personal finance expert and the author of How to Make Your Money Last. She writes regularly for the Bulletin.