People that are considering retirement simply look at their Social Security statement for additional income at the age they want to retire. They have no idea how to sequence their benefits with their spouses for additional income stream or improved survivor benefit.
This is the importance of looking at your benefits collectively. Of course, you must have turned age 62 by January 1, 2016 to be able to look at these options. People younger than that have an option to improve their situation called “Spousal Boost” which will need to be covered in a separate article.
What does sequencing mean? This means that under the new law (Bi-Partisan Budget Act of 2015) if one spouse files for benefits, the other spouse can file a Restricted Application for Spousal Benefits (50% of other parties’ full retirement age benefit) and allow their benefit to grow at 8% per year, until you want to file. This does not mean you must wait until age 70 – you could start filing at age 67.7 and collect the extra benefit amount you have earned. And, most importantly, it is not always the lower earner that should file off the higher earner. It needs to be reviewed because usually quite the opposite is the case. It depends on ages, desired lifestyle, other assets, health concerns, continued employment and many other variables that affect this sequencing.
That is why it is very important to have your benefits reviewed collectively. Some of the goals we strive for our clients are an income stream starting at full retirement age, highest benefit amount within the rules and regulations and your desires, and the highest survivor benefit based on your benefit amounts. This is not a one size fits all equation – it takes time and expertise to ascertain these numbers. The calculators on the internet will not do the job.
Call Pillars LLC at 601-954-0699 (DIAL before you FILE) and Roy and Diane will help you with these decisions and show you how to maximize your benefit and accomplish your personal goals. They are both National Social Security Advisors and Roy is a former CPA of 40+ years. We are in Corinth but service clients in all 50 states.
