Social Security matters
Dear Rusty: I've recently started reading your column on Social Security and am learning a lot! My particular question is this: I was born in November 1953 so my full retirement age is 66, which is coming up faster than I would have ever imagined. I am divorced but was married for 25 years before the split, and I have not remarried. I've heard that because I was born before 1954 I can still claim my ex's Social Security as a spousal benefit when I reach my full retirement age and let my own benefit continue to grow, switching to it when I turn 70. Is that correct? Is it likely to change if Congress looks for ways to cut entitlements to make up for the tax cuts? And how do I find out what my ex-spouse's benefit amount is if we are no longer speaking? Also, does your Social Security benefit amount continue to grow if you quit working but just don't take it? Or do you have to still be contributing to Social Security for it to continue to grow by that 8 percent per year I've seen you mention? Signed: Ex-Spouse
Dear Ex-Spouse: Yes, because you were born before January 2, 1954, you are “grandfathered” into something called the “restricted application for spousal benefits only.” That means that if your ex-spouse is collecting his Social Security when you reach your full retirement age (FRA), you may file the restricted application, collect spousal benefits equal to ½ of the amount he is/was entitled to at his full retirement age, and allow your own benefit amount to grow until you reach age 70 (you don’t actually need to wait until you are 70 to claim on your own record; you can claim at any time between your FRA and age 70). By delaying your own retirement claim you will earn delayed retirement credits at a rate of 2/3rd of 1% per month for each month you delay (that comes out to 8% per year). Social Security will require that you visit their office to find out what your ex-spouse’s current benefit amount is, and they will ask you to provide his Social Security number (otherwise you’ll need to provide his date and place of birth and his parents’ names). If you meet any reluctance to provide you with his benefit amount when you visit, be insistent and ask to speak to a supervisor; it’s your right to get that information to help with your retirement planning. You should also have a copy of both your marriage certificate and divorce decree available when you file the restricted application.
You don’t need to worry about Congress changing your option to file a restricted application; it was already changed by the Bipartisan Budget Act of 2015 to eliminate the “restricted application for spousal benefits” for anyone born after January 1, 1954. If you wish to go ahead with the restricted application once you have reached your full retirement age of 66, you can apply online starting with the regular benefit application process, but when you see the question Do you want to start your benefits now, answer NO. You will then see a drop-down menu from which you can select November 2018 as your benefit start date. After that when you see the question If you are eligible for both retirement and spousal benefits, do you want to delay receipt of retirement benefits, answer YES. Then on the last screen enter I wish to exclude retirement benefits from the scope of this application. I am filing a restricted application for spousal benefits. I am not applying for retirement benefits on my own work record. I want to earn delayed retirement credits. Since Social Security recommends you apply for benefits 3 months before you wish them to start, you may file your restricted application in September but be sure to specify November as the month you wish your spousal benefits to begin.
And regarding your last question, yes, your Social Security retirement benefit amount continues to grow, even if you quit working and are no longer paying FICA taxes from your earnings. You don’t need to continue contributing to Social Security to earn delayed retirement credits.