My wife is 63. I am 64. I plan on taking my SS benefit at full retirement age. My benefit is substantially higher than my wife. If she collects her benefit at 63, will it substantially reduce her spousal benefit when I start collecting at my Full retirement age?

Hi,

I don't know what you'd consider to be substantial, but filing at age 63 would reduce your wife's benefit rate even if she later qualifies for additional spousal benefits on your record.

For example, say Jill files for her Social Security retirement benefits at age 63. Jill's primary insurance amount (PIA), which is the amount she'd get if she started drawing her benefits at full retirement age (FRA), is $800. However, in return for starting her benefits at age 63 Jill's monthly rate is reduced for age to $626. When Jill reaches age 65 her husband files for his Social Security benefits. Jill's husband's PIA is $2000, so Jane is eligible for spousal benefits which she must file for as soon as she becomes eligible due to Social Security's deeming rules (https://www.ssa.gov/planners/retire/deemedfaq.html). Jill's unreduced spousal benefit would be calculated by subtracting her PIA from 50% of her husband's PIA, which in this example would be $200 (i.e. $2000/2 - $800). But, since Jill is starting her spousal benefits at age 65 her spousal rate is reduced for age to $177. Jill's reduced spousal benefit would then be added to her reduced retirement benefit to give her a combined monthly benefit of $803 (i.e. $626 + $177). If Jill had instead waited until age 66 to start drawing her own benefits and her spousal benefits, she would have received a combined benefit rate equal to a full 50% of her husband's PIA, or $1000 in this example.

I should also mention that if you start drawing your benefits at FRA you will be limiting both your benefit rate and your wife's potential survivor rate as a widow to no more than the amount of your PIA. Before applying for any benefits, you and your wife should strongly consider using our software to explore and compare your options so that you can be sure to choose the filing strategy that you believe will best address your needs.

Best, Jerry