Social Security Now and Later Spousal Benefit Strategy

A hand making a move with chess pieces
••• MichaelH/DigitalVision/GettyImages

If you are married you may be able to get more income from Social Security by looking at your options as a couple, rather than as two individuals. If one of you was born on or before January 1, 1954 you will have a claiming option available to you that has sometimes been referred to as double dipping. This "collect now and later" strategy provides some income now while locking in a higher benefit for later. Here's how it works.

The "Collect Now and Later" Social Security Strategy

When married, the "collect now and later" strategy allows you to collect a spousal benefit while accumulating delayed retirement credits on your own own benefit amount. Usually, the higher earner of a couple would consider this so they could get the most possible at age 70. That higher age 70 benefit amount then gets locked in as a survivor benefit.

Who Can Claim Now and Later

You have to file a restricted application to use this strategy. Unfortunately due to changes in the Social Security rules that were signed into law in November 2015, only those who reach the age of 62 on or before January 1, 2016 - which means you were born on or before January 1, 1954, can file a restricted application for spousal benefits. (Widow and widowers, however, can continue to use a restricted application.)

In addition, you must have reached full retirement age (FRA) and your spouse must have applied for benefits. If your spouse had reached their own FRA, up until April 30th, 2016 they had the option to file and suspend benefits, which would have allowed you to collect a spousal benefit now.

Since the April 30th, 2016 deadline has now passed, if your spouse suspends their own benefits, it would also suspend any benefits based on their record - which means you could not claim a spousal benefit while their benefit was suspended.

Why Doesn't it Work if You Have Not Reached Full Retirement Age 

If you apply for Social Security benefits before your full retirement age, you automatically qualify for and are given the higher of a benefit based on your own earning’s record or 50% of your spouse’s full retirement age benefit (then further reduced if you are claiming before your own full retirement age).

If you wait until full retirement age to apply, and you were born on or before 1/1/1954, you have more choices. You can apply for benefits and choose to begin collecting just a spousal benefit based on your spouse’s earnings record (or ex-spouse if you were married for at least ten years). Your own Social Security benefit will continue to accumulate delayed retirement credits until your age 70. When you reach age 70 you switch from taking the spousal benefit to taking your own benefit.

Example: Kara, age 66, is still working. Her husband Bob is collecting Social Security retirement benefits. Kara was born on or before January 1, 1954, so she files a restricted application for Social Security spousal benefits based on Bob’s earnings record. Kara continues to work until age 70. She collects her spousal benefit while working for the next four years; at age 70 she retires and switches to her own, now much larger, Social Security benefit.

For those born on or after January 2, 1954, when you file for benefits you will be automatically filing for all benefits you are eligible for and will be given the higher of your own or a spousal benefit. If your spouse has not filed yet, you will not be eligible for a spousal, so you will be given your own.

When your spouse files, if you are owed an additional amount because the spousal benefit is larger than your own, this additional amount will automatically be given to you. Rather than trying to work through all these options on your own, consider using a Social Security calculator to tell you what claiming strategy might work best for you.