If You're the Higher Earner in Your Household, This Could Be the Best Age to Claim Social Security

Social Security is one of the most important senior benefits today. If you don't have much income outside of those monthly checks, you and, if you're married, your spouse, may end up relying heavily on Social Security to make ends meet in retirement.

That's why it's so important to be careful with your filing decision. Although the monthly benefit you're eligible for is based on your work and earnings history, your filing age helps determine what benefit you lock in.

It's especially important to claim Social Security at the right time if you're married and are the higher earner in your household, especially if you're older than your spouse or expect your spouse to outlive you.

How delayed retirement credits work

The earliest age you could claim Social Security is 62. And you'll be eligible for your monthly checks without a reduction if you wait until full retirement age (FRA) to file, which is 67 for anyone born in 1960 or later.

But for each year you delay your Social Security claim past FRA, your monthly benefits accrue delayed retirement credits. Those credits are worth 8% for each year you wait up until age 70. So if you're eligible for a monthly benefit of $2,000 from Social Security at an FRA of 67, waiting until 70 gives you $2,480 per month instead.

You can't just think about your own needs when you're married

While delaying Social Security until 70 results in larger monthly benefits, it doesn't always mean more lifetime income. If you expect to pass away at a relatively young age, filing for Social Security at 70 could mean giving up some lifetime benefits.

However, when you do that calculation, don't just think about your own needs. Instead, if you're married and are the higher earner in your household, you'll also need to think about your spouse.

If you pass away before your spouse, as the lower earner, they should be entitled to survivor benefits from Social Security once you're no longer around. Survivor benefits equal 100% of the higher-earning spouse's benefit. So if you boost your benefits with delayed retirement credits, you could leave your spouse with larger monthly checks for the rest of their life.

Do the math to arrive at the right choice

If you expect to live a long life, then filing for Social Security at 70 may be the right choice for you. But even if that's not the case, 70 could still be the best age to claim Social Security if it means larger survivor benefits for your spouse, and if your spouse is likely to receive those checks for many years.

Let's say you're eligible for $2,000 a month in Social Security at age 67, but you delay until age 70 for a 24% boost. If you pass away at 75, you'll lose out on $43,200 in lifetime Social Security.

However, let's say you leave your surviving spouse with a monthly Social Security check that's $480 larger, and they collect that larger benefit for 10 years. That puts an extra $57,600 in their pocket compared to the survivor benefit they would've gotten had you claimed Social Security at FRA.

So in this situation, the math works out in your favor at the household level if you delay your claim until 70. Even though you might collect $43,200 less Social Security in your lifetime, your spouse would get more than enough survivor benefits to make up for it. You'd be ahead by $14,400 between the two of you.

Talk to your spouse about Social Security so you're on the same page

When you're not confident you'll live such a long life, filing for Social Security on the earlier side could make sense. But the logic needs to change when your spouse may become reliant on survivor benefits to make ends meet.

Ultimately, the best thing to do is run the numbers to see how much income you and your spouse might get in total based on different filing scenarios. Also consider your broad financial picture and discuss what's best together.

It may be that your spouse is anticipating a large inheritance, making them less reliant on survivor benefits than you initially thought. If so, they may encourage you to file for Social Security earlier so you could enjoy more of that money while you're still around to collect it.

Bottom line

If you have a large amount of savings and assets, and your Social Security benefits are only going to be a secondary income stream, then survivor benefits may not be so critical to your spouse. But if you're living on just Social Security, those monthly checks may be crucial to your spouse once you pass away.

Before you claim Social Security based on your own needs, health, and anticipated longevity, talk to your spouse and make sure you're making the right choice for both of you. Even if a delayed claim doesn't give you a larger Social Security paycheck in your lifetime, it could lead to larger survivor benefits and, ultimately, more Social Security between you and your spouse in total.

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