Should Both You and Your Spouse Delay Social Security?

The quick answer: It depends.

Maurie Backman
Maurie Backman
Mar 2, 2019 at 8:48AM
Investment Planning

Social Security serves as a lifeline for millions of seniors today. Even if you've saved well for retirement, there's a good chance those benefits will enhance your lifestyle, whether by giving you more money for leisure activities or by allowing you to travel more during your golden years. That's why it pays to get the most out of those benefits, and a good way to do so is by filing for them after reaching full retirement age.

Though your Social Security benefits are calculated based on how much you earned during your working years, the age at which you initially file for them will also dictate how much money you collect from the program each month. If you file at your precise full retirement age -- which, depending on your year of birth, is either 66, 67, or somewhere in between -- you'll get the exact monthly benefit your earnings record renders you eligible for. File ahead of full retirement age, and your benefits will decrease by a certain percentage for each month you claim them early.

Senior man and woman using a laptop

Image source: Getty Images.

But there's another option when it comes to filing for benefits, and it's one that can prove quite lucrative: You can delay benefits past full retirement age and boost them by 8% a year in the process up until age 70, at which point that incentive runs out. This means that if you're looking at a full retirement age of 67, waiting until 70 to claim benefits will give you a 24% income bump from Social Security. Not too shabby.

But what if you're married, and both you and your spouse are entitled to Social Security? Does it make sense for both of you to delay benefits? Or is there a better solution to consider?

Syncing up with your spouse

In some cases, it does indeed pay for you and your spouse to hold off on Social Security as long as possible. For example, if and your spouse are low on personal savings, earned roughly the same amount during your working years, and both expect to live a long life, then jointly delaying benefits past full retirement age might produce a larger ongoing income stream that will come in handy during your golden years.

But that's not the only move at play here. If you and your spouse each have a work record, you can stagger your claims so that you're getting benefits at different points in time. You might, for example, have the lower earner of the two of you file for benefits at full retirement age to have some Social Security income coming in, while the higher earner grows his or her benefits by waiting until 70. Or, you might do the opposite -- have the higher earner take benefits sooner, and grow the lower earner's benefits into a higher sum.

Something else to keep in mind is that if you never worked, but are entitled to spousal benefits through Social Security, then you can't file for them until your spouse starts collecting benefits him or herself. Now let's say you're the same age as your spouse, and your spouse plans to file at 70 to get the maximum monthly benefit he or she is entitled to. In that case, you'll effectively be forced to delay your own benefits, even though you'd otherwise be entitled to claim them sooner.

Now if you're entitled to benefits based on your own work record but your spouse earned significantly more than you did, another option you might consider is filing for your own benefits at full retirement age and letting your spouse's benefits grow by having him or her file at age 70. Once your spouse files, if half of his or her benefit amount at full retirement age exceeds your full benefit, your monthly payments will be bumped up to make up the difference. In other words, you'll get a boost in your monthly Social Security income even without having waited past full retirement age yourself.

One final thing to keep in mind is survivor benefits. If your spouse collects a larger benefit than you, once he or she passes, your benefits will be replaced by survivor benefits equal to whatever your spouse was receiving. Therefore, if you're married and expect your spouse to pass away well before you do, you might have that spouse wait to file benefits as long as possible if his or her monthly payments will far exceed yours. In that case, you might claim your own benefits earlier and then fall back on a larger monthly payout for life in the form of higher survivor benefits.

Delaying your Social Security benefits will put a larger amount of cash in your pocket each month. Whether it pays for both you and your spouse to delay benefits, however, will depend on your respective earnings records and life expectancies, as well as your collective needs. Talk about your choices either way, and map out different scenarios to get a sense of what might ultimately work best for you.