For many of my baby boomer client that are close to retirement, calculating their Social Security Benefits is an important part of the financial planning process. It’s important to have a good understanding of the monthly benefit so that we know which other retirement buckets will be producing the short fall (if any) of their income needed for retirement. In many of my client situations, the husband has been the primary bread winner, so there isn’t much question on their Social Security Benefit.What does arise some questions is the spouse’s social security benefit. It can be confusing in situations where the spouse worked some years back, and is not totally sure to how much they paid into social security.
If you are married, you can claim social security benefits based on your history of earnings or you can collect social security spousal benefits which are equal to 50% of your spouse’s social security benefit. There are several advantages for married couples and their social security benefits, and you have the ability to receive benefits for a longer period of time in some cases. If you’re a widow, you can also claim social security spousal benefits.
How Social Security Spousal Benefits Work
You have the option of claiming your own social security benefits, calculated from your work record, or claiming up to 50% of what your husband or wife will receive as your spousal benefit, if your husband or wife has filed for social security. You can’t collect both your own social security benefits and your spousal benefit at the same time. If you are entitled to both, you’ll receive the larger of the two.
A widow who collects survivor benefits at the normal retirement age (or later) will receive 100% of the deceased spouse’s social security benefit. If you file for social security spousal benefits between the age of 60 and your normal retirement age, the amount you receive will shrink 71 to 99%. It’s always better to delay receiving social security benefits for as long as possible to increase the amount you’ll receive.