Key Takeaways:
Most couples plan Social Security around the higher earner's check, ignoring the spousal payment worth up to 50 percent of it.
Couples planning Social Security around the higher earner's check routinely skip the spousal benefit worth up to 50 percent of it, a payment that can add hundreds of dollars a month for life.
"When a couple sits down to plan their Social Security timing, one thing surprises them almost every time: They don't agree," said Hans Scheil, founder and CEO of Cardinal Advisors, a retirement planning firm in Durham, North Carolina.
Consider a hypothetical couple, Mark and Diane, both in their mid-60s with a full retirement age of 67. Mark's benefit at full retirement age is $3,200 a month, but he plans to wait until 70 to collect $3,968. Diane spent most of her career raising children and working part-time, so her own benefit is only $700 a month. She is also eligible for a spousal benefit of up to $1,600 a month — more than double her own — but she cannot collect it until Mark files.
The decision is effectively irreversible. Social Security allows a claimant to withdraw an application within 12 months of filing, but only once, and every dollar received must be repaid. Because the survivor keeps only the larger of the two checks when one spouse dies, the higher earner's filing age sets the income floor the surviving spouse will live on for the rest of their life.
The spousal benefit is the piece of Social Security planning most couples skip until it's too late to matter, Scheil said. A spouse with little or no work history, or whose own benefit is smaller than half of the higher earner's, can collect up to 50 percent of the higher earner's full retirement age benefit. The catch: the higher earner must file first.
While Mark waits until 70, Diane can draw her smaller $700 benefit or wait alongside him. Either way, that's three extra years of a meaningfully smaller household income in exchange for a bigger check down the road. Whether the trade-off is worth it depends on the couple's full financial picture, which is why the number needs to be calculated, not assumed.
The break-even age — the point at which the extra money from delaying catches up to what would have been collected by filing earlier — typically lands in the early-to-mid 80s for someone weighing full retirement age against 70. If a couple expects to live well past that, delaying tends to pay off in total lifetime benefits. If health or family history points the other way, filing earlier may make more financial sense.
When one spouse dies, the survivor does not keep both checks. The smaller one stops, and the survivor keeps the larger one for the rest of their life. That makes the higher earner's filing age the single most important decision for the surviving spouse's income, especially when there is an age gap or a health difference between spouses.
The rules have narrowed over time. The Bipartisan Budget Act of 2015 eliminated the restricted application strategy for anyone born after January 1, 1954, closing it to all new claimants by 2026, according to the Social Security Administration. Deemed filing now forces spouses to claim both spousal and personal retirement benefits simultaneously, removing the ability to collect one while the other grows. Delaying the higher earner's benefit to 70 still adds roughly 8 percent a year in delayed-retirement credits, and survivor benefits can be sequenced separately from retirement benefits.
Scheil recommends three steps couples can take without an adviser. Pull both statements from SSA.gov and record each spouse's benefit at 62, at full retirement age, and at 70. Calculate the spousal benefit two ways — compare each spouse's own benefit against 50 percent of the higher earner's full retirement age benefit and use whichever is larger. Run break-even math with a free tool such as Open Social Security, which plugs in actual birth dates and benefit amounts to show a household's real break-even age and total lifetime income under different filing combinations.
Social Security timing is not a decision either spouse should make alone, and it should not be settled by general advice. It depends on the spousal benefit, the break-even age, health, and what happens to the survivor. Do the math for the household, not someone else's, and have the conversation with real numbers on the table before filing — because after that, there's no going back. Rules and benefit figures change, so verify the latest details against official announcements from the Social Security Administration before making a claim.
This article is for informational purposes only and does not constitute investment advice.
