Strategizing for Social Security would be relatively simple if all spouses spent roughly the same amount of time in the workforce and earned roughly the same amount of money. Pretty much all they’d have to do is pick the best time for each to claim their roughly comparable retirement benefits.
In real life, of course, this is rare. One partner may have had a significantly more lucrative working life than the other. One may have delayed career pursuits for child-rearing or set them aside for caregiving.
Get instant access to members-only products and hundreds of discounts, a free second membership, and a subscription to AARP the Magazine.
For such couples, maximizing Social Security income might mean combining retirement and spousal benefits — payments spouses can receive based on their mate’s earnings history rather than their own — and coordinating claims to optimize their payments.
That means weighing numerous variables, including both spouses’ age, health and timetable to retire, and understanding how each affects benefit options. There will definitely be math.
“When you have a couple, it gets complicated,” says AARP Financial Ambassador Jean Chatzky, founder and CEO of HerMoney.com. “You’ve got a higher earner, you’ve got a lower earner, typically. You’ve got people who may be able to claim on each other's records. And that means that there are hundreds, if not more, of ways that you could decide to claim.”
But understanding the range of potential claiming options can be a “game-changer” for households in which one spouse provided most or all of the income, says Malik Lee, founder and managing principal of Felton & Peel Wealth Management in Atlanta.
“That’s the power of navigating the Rubik’s Cube or the Pandora's box of Social Security,” he says.
Know your benefit — and theirs
Auxiliary benefits for people married to Social Security recipients have been part of the program since 1939, four years after its inception. Today, qualifying husbands and wives can receive a spousal benefit of about one-third to one-half of their mate’s monthly benefit amount, depending on their age.