I understand that waiting until age 70 to take SS benefits will provide the maximum benefit, but in my case I will be subject to the family maximum sooner as both my wife and disabled adult daughter will also be receiving benefits based on my work record. I am trying to calculate the minimum age, after I retire, that I can start to receive SS benefits at the family maximum amount. My current SS statement estimates my monthly benefit at $2973 at my full retirement age of 67. I calculated my family maximum as $5202.31 [1.5*1144 + 2.72*507 + 1.34*503 + 1.75*819]. Using the tables on the SS website it appears that I would reach the maximum at around age 65 + 4 months at which point I would receive 88.9% of $2973 and my wife and daughter would each receive 43.1% of $2973 [$2643 + 2(1281.36) = $5205.72]. Am I calculating this correctly? Thank you very much.

Hi,

No, you're mistaken about how the family maximum benefit (FMB) is applied. First off, your benefit rate would be calculated and paid without regard to the FMB. And, any increase in your benefit rate resulting from delayed retirement credits (DRC) would not reduce the amount payable to your family members.

For example, if your full retirement age (FRA) is 67 and your full retirement age rate (PIA) is $2973, then your monthly rate if you waited until age 70 would be roughly $3686 or 24% more than your age 67 rate. But, in order to determine the amount of benefits available to be paid to your wife and daughter Social Security would subtract only your PIA from the FMB. So, if your FMB was $5202 you would subtract your PIA of $2973 to arrive at a total of up to $2229 that could be paid to your wife and child.

Furthermore, if you start drawing reduced benefits prior to FRA your full PIA would still be deducted from the FMB when determining the amount available to be paid to family members. In other words, if your FMB was $5202 and your PIA was $2973, only $2229 would be available to split between your eligible family members even if you started drawing at age 62 and your benefit rate was reduced by 30% to $2081 (https://secure.ssa.gov/apps10/poms.nsf/lnx/0300615756).

Our maximization software is fully programmed to handle all of the various calculations that would be involved in your case, so you may want to strongly consider using it in order to determine the best overall filing strategy for you and your family.

Best, Jerry