My wife reached FRA in Sept 2017, I reach FRA in April 2018. Because of WEP I figure my retirement benefit will be about 60% of full amount (there were several years after retirement that I did not earn much due to the Medical issues.) We are both working full time and neither of us has filed for any benefits under either Medicare or SSA. My wages now are $50K + a Medical Disability retirement from my 1st career (~ $36K). My wife is a substitute teacher and usually makes about $12K to $14K a year (and that is working every day of the school year), last year she earned $16.5K.

Will your software help answer the following questions?

question set 1:
Can/should my wife apply retroactively for her full retirement benefit?
Can I apply for a spousal benefit retroactively based on her account, even though I am currently employed and the higher wage earner? (because of WEP my adjusted FRB would be ~$520 (based on ~$927 FRB using SSA's simple calculator), while her FRB is ~$730.

question set 2:
When I reach FRA can my wife continue to work and only draw her spousal benefit (~$460) based on my FRB and not draw her FR benefit until age 70? The SSA person I talked to on the phone stated I could file for benefits so she could draw but then "suspend them" (I thought that was no longer an option for my age group) until what ever time I decided, or am forced, to fully retire (medical issues again). a.) If she does will she be entitled to both her FRB and a spousal benefit? b.) Could she apply for both her FRB and spousal benefit now?

question 3:
I have a 403b which I would like to cash out (~$70K) to purchase a smaller residence (hopefully) requiring less upkeep. Will drawing those monies out after FRA affect anything to do with either of our SS Benefits if I choose to do it after retirement? (payout term may be dependent on taxes, SS Benefits may be another important consideration, based on lump sum vs. short term payout over x# of years)

question 4:
Can my wife draw her FRB, and spousal and I draw my FRB? Or when I start drawing FRB does she lose one or both of her benefits, especially since her benefits are higher than mine?

I guess the scenarios are endless so will stop with these 4. I suppose there is a scenario out there where we both just wait until 70 as originally planned and draw then, but..... ',;~D

Thank you,

Tim

Hi Tim,

Yes, our software should be able to analyze all of your possible options and help you determine your best overall filing strategy.

I'll try to briefly address some of your questions, though. You couldn't draw spousal benefits unless your wife is drawing her retirement benefits, nor could she draw spousal benefits unless you were drawing your benefits. And, neither of you could be paid spousal benefits if the other spouse voluntarily suspends their benefits (https://www.ssa.gov/planners/retire/suspendfaq.html).

If your retirement benefits are reduced due to WEP, that will also lower the amount of your wife's potential spousal benefit. In other words, if your full retirement age rate after the WEP adjustment is $520, your wife's potential unreduced spousal rate would be half of that, or $260.

Receiving money from your 403b plan won't affect either your or your wife's Social Security benefits unless it is from a defined contribution plan from an employer where your earnings were exempt from Social Security taxes (https://secure.ssa.gov/apps10/poms.nsf/lnx/0300605364).

Neither you or you wife could be paid spousal benefits if you file for your own retirement benefits and your full retirement age rate (PIA) is higher than 50% of your spouse's PIA. In other words, if you file for both retirement and spousal benefits you can only receive the higher of the 2 rates, not both. One of you could, however, start drawing your retirement benefits in order to allow the other spouse to file a restricted application for spousal benefits only at their FRA while leaving their own retirement benefits to grow until age 70. Our software can help you determine whether or not this would be a good strategy in your case, and if so which of you should file for retirement benefits while the other draws spousal benefits.

Best, Jerry