Hello, I will be 69 years old in a few months. I was laid off in August 2017, 4 months ago, from a high paying position, and am currently collecting unemployment insurance. I have not claimed a social security benefit and was hoping to wait until age 70 to maximize the benefit. I am married and my wife is 62 and is working but her income will be declining. I am seeking another position but so far I have been unsuccessful, even though I am highly qualified. I have savings and a pension which has not yet been activated. Regarding obtaining new employment, my age is the issue. I have 3 questions: (1) if I still wait until age 70 to claim social security will my benefit be reduced if I remain unemployed and/or take another position that will pay far less than I was earning ($118K-year)? (2) would it make more economic sense to activate my social security benefit before turning 70? (3) should my wife claim 1/2 of my social security benefit (prior to turning 66) or should she also wait as long as possible before claiming? Any advice you can provide would be greatly appreciated.

Hi,

Your benefit rate won't be any lower if you remain unemployed or take a lower paying job, provided that you weren't using projected future earnings to calculate your expected benefit rate. Your full retirement age rate (PIA) is based on your highest 35 years of wage-indexed earnings (https://www.ssa.gov/pubs/EN-05-10070.pdf), so your rate will neither decrease or increase if you stop working.

What would lower your rate is if you start drawing your benefits prior to age 70. Your benefit rate is increased by 2/3rds of 1% for each month, or 8% per year, that you decline drawing your benefits between full retirement age (FRA) and age 70. Therefore, if you start drawing at age 69 your benefit rate will be 8% lower than it would have been had you had waited until age 70.

Whenever your wife files for spousal benefits she'll also be deemed to be filing for retirement benefits on her own record. She'll basically just receive the higher of the 2 rates, and her rate will be reduced if she starts drawing benefits prior to her FRA. However, your wife may want to consider filing for reduced retirement benefits now so that you could draw spousal benefits on her record until you reach age 70. Whether or not that could be a good option in your case depends on your wife's expected earnings and your relative benefit rates. You can use the maximization software available on this website in order to determine your best overall filing strategy.

Best, Jerry