Don’t Wait to Collect Your Social Security Spousal Benefits

Don’t Wait to Collect Your Social Security Spousal Benefits

Generally speaking, the longer you wait after reaching your full retirement age to collect Social Security benefits, the larger your monthly payments will be.  For most people, that means waiting until age 70 to start collecting.  If you can afford to wait, it makes a lot of sense to defer collecting benefits but it’s also important to know that in some cases, waiting could mean you miss out on money you’re entitled to receive.  If you’re getting close to your full retirement age, Crash Proof Retirement has some important information about situations when waiting to collect could be a big mistake.

Normal Social Security Benefits

Depending on the year you were born, your full retirement age will change.  It’s currently 66 years and 2 months for people born in 1955, and gradually increases to 67 for people born in 1960 or later.  Collecting before this age will mean a reduced monthly benefit amount.  Of course, if you wait to start collecting benefits until after your full retirement age, you will earn delayed retirement credits that boost your monthly payments.  While waiting to collect can increase your monthly payments, remember that you stop accruing credits at age 70.  Of course, these rules only apply to retirement benefits based on your own work history.  If you’re collecting your spouse’s benefits, the rules are different.

Social Security Spousal Benefits

If you’re collecting social security benefits based on your spouse’s work history, it can make sense to start collecting earlier than age 70.  Spousal benefits do not accrue delayed retirement credits the way your normal Social Security benefits would.  For that reason, it usually makes more sense to start collecting at your full retirement age rather than waiting until age 70; you won’t get anything extra for waiting.  You could even start collecting spousal benefits at age 62 as long as you were married for more than a year.

Social Security Survivor Benefits

If your spouse passed away and your social security benefits are based on their work history, waiting until age 70 to collect won’t increase your monthly benefits or net you any delayed retirement credits, although your amount can be reduced if you don’t wait until your full retirement age.  However, if your spouse accrued delayed retirement credits and began collecting benefits prior to passing away, your monthly payments will be based on their benefit amount.  If you are eligible to receive survivor benefits, you can safely start collecting at your full retirement age with no penalty.

If you are eligible to collect either social security spousal benefits or survivor benefits, waiting until age 70 can mean you’ll miss out big time.  In some cases, you may be able to recover a portion of your benefits back as a lump sum, but anything beyond that will be lost.  Don’t miss out on the social security benefits you deserve; talk to your financial advisor today!  At Crash Proof Retirement, it’s our goal to educate everyone in or near retirement about important facts like these, so get in touch with us right away for help planning for your retirement or tune in to the Crash Proof Retirement Show to find out more.