John and Mary are a retired couple who have been married for over 30 years. John worked for the military and now receives a pension, while Mary stopped working 15 years ago and began drawing her Social Security benefits at age 62. She currently receives $615 a month after deducting Medicare premiums.
John is close to retiring and plans to claim his Social Security benefits when he turns 70 next year. According to his projections, he will receive about $4,500 a month if his income remains the same in 2024 as it was in 2023. He also has a 401(k) with about $870,000, which he has managed conservatively over the years.
The couple is wondering if Mary can claim spousal Social Security benefits and receive more than her current amount. They are also unsure if John should start drawing his Social Security benefits in February, when he turns 70, or wait until April to ensure the maximum benefit. To be eligible for spousal Social Security benefits, Mary must have been married to John for at least one year, and John must currently receive retirement benefits.
Maximizing Mary’s Social Security benefits
Additionally, Mary must be at least 62 years old, caring for a child under 16, or caring for a child with a disability that began before age 22. The amount Mary receives in spousal benefits is based on John’s Primary Insurance Amount (PIA).
If Mary has reached full retirement age, she can receive up to 50% of John’s PIA. However, because Mary began drawing her own benefits at 62, her spousal benefit will be reduced, but it is still likely to be higher than her current amount. It is important to note that there is no advantage for John to wait beyond age 70 to start collecting his Social Security benefits.
His benefit amount will be at its peak when he turns 70, and delaying beyond that offers no additional increase. Given that John’s 70th birthday is in February, he should start claiming benefits then rather than waiting until April. To determine the exact amount Mary is eligible for, the couple should make an appointment or call the Social Security Administration.
Understanding these key aspects can help John and Mary make an informed decision about when and how to claim their Social Security benefits and maximize their retirement income.
