Before I begin todayβs column, I must clarify something. In several past columns, I discussed the looming April 30 deadline for filing a Social Security retirement claim and then immediately suspending benefits, usually to allow a husband or wife to claim spousal benefits while your own retirement checks remain in suspense until age 70 so that you can reap a 32 percent βdelayed retirement bonus.β
This is the infamous βfile and suspendβ strategy. In order to employ this strategy, you must be age 66 before the April 30 deadline. But in one of the recent columns, I said that there was a chance that someone turning 66 in the four-month period after April 30, (in other words, by Aug. 30), might still be able to βfile and suspendβ by the April 30 deadline because people can file up to four months ahead of time to claim retirement benefits. For example, someone turning 66 in July could file a claim in April, requesting a July start date. But I have since learned that people turning 66 during this four-month βprospective lifeβ of a Social Security claim cannot employ the βfile and suspendβ strategy.
In other words, you must be age 66 before April 30, and file a Social Security retirement claim before April 30, in order to be able to use that strategy.
Q: I am 66 years old. I want to file and suspend, so that my husband, who will be 66 in June, can claim benefits on my Social Security account, and then delay his own benefits until age 70. I, too, will delay claiming my benefits until 70. That way we each get the 32 percent bonus and my husband collects spousal benefits in the meantime. We were planning to do this following your advice. But I called Social Security to set this up, and the representative said we could not do this. I called back later and talked to someone else. This person said that I could βfile and suspend,β but that my husband could not. What should we do?
A: Before I tell you what to do, I am going to explain your situation to those readers who may be confused about what you are trying to accomplish.
You want to delay collecting Social Security benefits until you are 70 years old in order to have a 32 percent βdelayed retirement bonusβ added to your monthly Social Security checks. So normally you would simply wait until age 70 to do that. But a loophole in the law (that expires on April 30) allows you to file a claim for Social Security retirement benefits and then immediately suspend those benefits. And you would do that so that your husband can pull off another Social Security maximizing gambit called βfile and restrictβ when he turns 66. At that age, he will be able to collect an amount equal to 50 percent of your full retirement age benefit (even though your benefits are in suspense) until he is 70 years old, at which point he would switch to his own retirement and get that aforementioned 32 percent bonus added to his own Social Security checks.
As Iβve mentioned many times in this column, in my humble opinion, all these Social Security shenanigans are morally wrong β although they are legal. At least they are legal for a short time more. Congress agreed with me and eliminated these legal loopholes that grew out of some too-hastily-written Social Security amendments a few years back. As I said at the beginning of this column, the βfile and suspendβ loophole will close on April 30. The βfile and restrictβ loophole remains open until 2020.
There are a variety of reasons why I think these so-called βmaximizing strategiesβ are morally wrong. But the biggest one is this: It makes absolutely no sense for your husband, who presumably has been working all of his adult life and earning his own Social Security retirement benefit, to be able to collect dependent spousal support on your record until he is 70 years old. In other words, why should the taxpayers be supporting him with these dependency checks when he clearly was not your dependent and is eligible for his own retirement benefit?
Having said that, because these plundering ploys are still legal for a short while yet, you have every right to employ them. But one of the big problems people have been having when trying to implement these strategies is finding a Social Security rep who thoroughly understands them, especially at the agencyβs hotline: 800-772-1213. Obviously, that is what you have experienced. Normally, I would tell you to call that toll-free number again, and no matter what the agent tells you, demand to set up an appointment to βfile and suspendβ β in other words, to file and claim and immediately suspend it. But because you need to have something done by April 30, and because Iβve heard from lots of people who have told me that they canβt get appointments until sometime in May, I am going to suggest you go down to your local Social Security office ready to file a suspended claim. Take a good book along because without an appointment, you are going to sit there awhile. But just be patient, and eventually someone will take care of you.
Another option would be to file a claim online at www.socialsecurity.gov. But I have heard from many readers who told me they could not figure out how to pull off the βfile and suspendβ gambit. Or to put that another way, they were able to file a retirement claim online, but they couldnβt figure out how to then turn around and suspend the benefits. And thatβs the little trick you need to pull off in order to delay your own benefits until 70 while setting up your claim so that your husband can file on your account when he turns 66.
As an old fuddy duddy raised in the old school of Social Security, I canβt wait until all this maximizing game-playing is behind us and we can get back to the good old-fashioned and relatively simple Social Security program that has served the American people well for more than 80 years now.
