I am the higher earner and my spouse was the lower. If I draw survivor benefits at age 62 which will be heavily reduced due to continuing to work and the excess wages provision, will any of that money ever be gained when I switch to my own higher benefit at my FRA. Or, due to the fact that I am switching to my own earnings record are all the dollars lost due to excess wages forever gone. I was born in 1958.

Hi,

No, benefits withheld prior to a person's full retirement age (FRA) as a result of the Social Security earnings test are never really returned to the affected person. The only way a person can recoup the lost benefits is from the resulting adjustment in their benefit rate that occurs when they reach FRA. That adjustment only applies, however, to the type of benefit that they were drawing when the benefits were withheld.

For example, say Jane files this year at age 62 for widow's benefits. Jane's unreduced widow's rate if she filed at FRA would be $2000, but her reduced rate at age 62 is $1610. However, Jane continues to work and because of her earnings she can only be paid half of her benefits between age 62 and FRA due to the earnings test. At FRA, Jane's widow's rate would then be adjusted to $1805 to remove half of the reduction for age that was originally applied.

In the above example, if Jane lives long enough and continues drawing widow's benefits she could more than recoup the benefits she lost to the earnings test as a result of her increased widow's rate. However, if Jane switches to drawing a higher benefit rate based on her own work record then her widow's benefits would stop. If that happens at FRA, then the adjustment in Jane's widow's rate that would have occurred at FRA would be moot. But, if Jane waited until age 70 to switch to her own record then she would at least recoup part of the benefits lost to the earnings test during the years between her FRA and age 70.

Regardless, though, if you are potentially eligible for both Social Security retirement and widow(er) benefits, your best filing strategy is almost certainly to file for the lower benefit as soon as your earnings would permit payment of at least some benefits, and then switch to the higher benefit when it reaches it's highest possible rate. Our software (https://maximizemysocialsecurity.com/purchase) could help sort all of this out for you so that you can determine the best possible way to maximize your benefits.

Best, Jerry