File and Suspend Strategy

There is a fair amount of interest in the Social Security provision called ‘file and suspend’.  This strategy is particularly helpful if one spouse has earned significantly more than the other over their working lives.  Our example is a dual earning couple where both wage earners are 63 years old and neither has filed for Social Security.  The higher wage earners full retirement age is 66 and she would qualify for a $2,200 monthly benefit.  At age 70 she would receive $2,904 per month.  Her spouse qualifies for $900 per month at his age 66 and $1,188 on his own at age 70.  Here is how the ‘file and suspend’ works.  At age 66 the higher wage earner files for Social Security and then suspends her benefit via a suspension of her application.  Her spouse applies for a spousal benefit based on her earnings and benefit.  He will receive 50% of her benefit or $1,100 per month.  He collects the higher spousal benefit for the next four years.  When both earners turn 70 the higher wage earner collects her $2,904 benefit.  Should she pre-decease her spouse he can collect her benefit for the remainder of his life.  This plan should be reviewed and discussed with a Social Security expert but can be helpful in increasing overall family benefit.