Washington, DC - Dear Rusty: I am nearing my full retirement age of 66 and given the differences in age of my wife and I, and the retirement benefits we will each receive; I was wondering what the best options are for us claiming SS and when. I am 65 and will turn 66 (my full retirement age) in September and my benefit then will be $2347/month as per the latest estimate on the SSA website. My Wife is currently 58 years old. Her full retirement age is 67, which will be in January 2028. Her estimated SS benefit at full retirement age will be $2498/month. I have read some things regarding being able to defer one of the benefit payments and receive the other (higher) amount based on certain criteria. I’m not sure if it would apply or be of benefit to us but was wondering if it would. I am looking for the best options to receive the most in benefits that would apply to us. ~ Planning Ahead

Dear Planning: I think you’re referring to the “restricted application” which can be used to collect spousal benefits while allowing your own to grow, but I’m afraid that is not something you can take advantage of. It’s an option not available to your wife because her birth year is after the cutoff imposed for that option by the Bipartisan Budget Act of 2015, and it’s not available to you because your wife isn’t yet eligible to collect Social Security on her own work record.

You have the option to take your full benefits in September at your full retirement age (FRA) or, if it’s financially feasible, you may also choose to delay past your FRA to claim. If you delay past your FRA you’ll earn Delayed Retirement Credits (DRCs) of 2/3rds of 1% per month of delay (8% per year of delay) up until age 70 when your benefit would be 32% more than it will be in September. Whether that’s a good choice for you depends upon how badly you need the money right now, and your health and expected longevity. If you enjoy at least average longevity (mid-80s) then you’ll get the most in cumulative lifetime benefits by waiting until age 70 to claim. 

Your wife cannot collect Social Security benefits until she reaches age 62 in 2023. If she claims at that time she’ll be automatically deemed to be filing for both her own SS retirement benefit and any spousal benefit she might be due from your record. However, given the benefit estimates you’ve shared she’ll not be eligible for a spousal benefit from you (nor will you be eligible for benefits from her). Spousal benefits are only paid if 50% of the higher earner’s benefit at FRA is more than the lower earner’s FRA benefit amount. Since neither of you will be eligible for a spousal benefit, your wife should also consider delaying past her full retirement age if her personal and financial circumstances at the time permit. To do so, she will gain 24% more benefit at age 70 than she would get at her full retirement age of 67.

So, for both of you to achieve the most you can get, the longer you both delay past your respective full retirement ages the more your benefit will be, up to age 70 when the maximum is reached. Since your wife won’t reach her FRA until January 2028 but will be eligible to apply for benefits in 2023, be aware that if she applies before her FRA her benefit will be reduced (according to the number of months before her FRA that she applies), and that if she starts her benefits before her FRA and continues to work, she’ll be subject to Social Security’s earnings limit. The earnings limit changes annually, so I can’t tell you what it will be in 2023, but it will be more than the 2019 limit of $17,640.