Yes, a Nonworking Spouse Can Collect Social Security

Dear Carrie: While I am still employed, can my nonworking wife retire and receive Social Security benefits? -- A Reader

Dear Reader: There's a lot of confusion about whether or not a nonworking spouse is entitled to Social Security benefits, so I'm glad you asked this question. The short answer is that a nonworking spouse who has reached age 62 can collect Social Security based on the working spouses earning's record, once the working spouse has filed for benefits.

You say that you're still employed, so I'm going to assume that you're not collecting Social Security yet. I'm also going to assume, for the sake of simplicity, that your wife doesn't qualify for her own benefits. (If she did, she could file in her own name regardless of your filing status once she turned 62.) If my assumptions are accurate, while your wife may be eligible for Social Security benefits, she can't collect until you file for benefits yourself.

This sounds clear enough, but as with so much that has to do with the government and money, there are a number of rules and exceptions to complicate things a bit.

The Social Security benefit of a nonworking spouse is 50 percent of the full benefit of the working spouse. So if your full benefit is $2,000, your wife would be able to collect $1,000. However, the age limits that apply to worker benefits also apply to spousal benefits. There are two choices. Your wife can:

-- Take Social Security at age 62. But the 50 percent spousal benefit would be further reduced by about 25 percent for the rest of her life.

-- Wait until what the IRS designates as her "full retirement age" (between 65 and 67, depending on when she was born) to receive the full spousal benefit. In this case, she will receive 50 percent of your full benefit.

Just for the record, there is an exception to the age requirement if your spouse is caring for your child who is under age 16.

Both you and your wife should give a lot of thought to when to begin collecting Social Security. For instance, if you applied early at age 62, your benefit would be permanently reduced. If your wife also elected to take Social Security early, her 50 percent benefit would be permanently reduced. That could make a big hole in your monthly income.

While it might seem smart to begin taking benefits as soon as possible -- after all, you'll then collect checks for a longer period of time -- it's a good idea to look at your "break-even age" before making a final decision. This is how long you need to live to make sure choosing a later date will give you greater lifetime benefits. You can find a break-even calculator at IRS.gov. It's definitely worth a look. Chances are, the longer you can each wait, the better.

You don't say how old you are, but if you've reached your full retirement age, you could file for benefits, even though you're still working, and your wife could then file for the spousal benefit. At full retirement age, there's no limit on the amount you can earn and still collect full benefits. However, if you prefer to delay taking your own benefits, there's another strategy to consider. The IRS lets you file for Social Security and then immediately suspend your benefits. This would allow your wife to begin collecting a spousal benefit based on your earnings while you continue to work. At the same time, your own future benefit would continue to grow. Another plus to this strategy is that the larger your eventual benefit, the larger your wife's survivor benefit. That's because, should you die first, your wife would collect 100 percent of your Social Security.

As you can see, there are a number of things to consider. I'd suggest you talk to your financial or tax adviser about the best strategy for both you and your wife. A little planning can help maximize the total benefit for your household. And why not? After all, you've earned it!

“Snippy” goes both ways.

I can't read your mind on how it was intended. Just what you wrote. And it was written to me.

This place is in a constant state of flux. There's been many bright posters over the years and many are still here. There was a time honest lefties were tolerated and put up the good fight. For the most part those days seem to be over. There's also been some pretty ugly times of endless flame wars between various factions. Remember Mojo, Toiletman and OneWhoKnows?...

For the most part things have calmed down. And as a result the thrill is perhaps gone for those looking for a constant challenge (to put it kindly).

There is also the fact that many of us have families and work obligations and no longer have the time we use to have - time I shouldn't be spending now...

What you seem to be ignoring is that tax law favors marriage. It also rewards people for raising kids which ideally takes at least one full time parent to do. Marriage is making two people into one in a number of ways. My income is my wife's income. As an example try getting divorced and see how the law sees "your singly earned wealth" when she stayed at home and raised the kids. And last but not least, yes SS is capped but so what. SS taxes don't go into some "lock box" for SS... I also pay both halves owning my own business. We also pay far more than the SS cap in income taxes that in truth get used for SS benefits for others. I don't know the rules on SS but I would think it likely that if the wife draws SS that the husband likely gets reduced benefits as a consequence.

If you want to rage about something, rage about the earned income tax credit where people collect a large "tax refund" without paying any income tax through the IRS. Its turned the IRS office into a welfare office.

that the husband likely gets reduced benefits as a consequence.

No. Not according to the article. His benefits aren't reduced at all. The nonworkers get up to a 1/2 of what the workering spouse benefits - they use his benefits as a guideline only to determine the nonworker's 'benefits'. but it doesn't affect the workers benefits.

I posted earlier - two spouses working all their life and paying into SS, if one dies before retirement, the other spouse only gets one payout after making TWO individual contribution. She/he can't collect on their dead spouses contributions. So it's wealth distribution when the nonworker gets a freebie. IMO, if two parents make two contributions they should be entitled to two payouts - he/she should be able to collect on the dead spouses contribution along with their own - if one can receive something for not working with NO contribution, at all.

I can't read your mind on how it was intended. Just what you wrote. And it was written to me.

You are absolutely right. I was venting - and not from your post - but from all the ones so off topic - with their rants on why they stay at home. That's not what the article is about or what I was addressing. Like you said, time here with other more important things to do, too much wasted time on nothing.

I remember Mojo and One Who Knows. I'm not looking for a challenge - my life gives me that and there are many trolls here. I just remember there were many sharp posters and, yes, they are still a few. Sorry about my venting and thanks for understanding.

And with your own business you pay double - we had the same situation along w/major taxes. Good night or good morning. And all the best w/your business - smart choice.

Thank you all for your opinions.

SS is supposed to begin deficit type spending in 2010.

http://www.dvanarelli.com/blog/?p=5272

“Social Security took in only $3 billion more in taxes last year than it paid out in benefits — a $60 billion decline from 2008, according to federal data. The impact of the recession is likely to hit the giant retirement system even harder this year and next. The Congressional Budget Office previously projected that Social Security would operate in the red in 2010 and 2011, but a deeper economic slump could make those losses larger than anticipated. “Things are a little bit worse than had been expected,” says Stephen Goss, chief actuary for the Social Security Administration. “Clearly, we’re going to be negative for a year or two.”

As a stay at home parent that just finished my “stay at home stuff”:

I milked, fed critters, moved hay, cleaned the milkroom, took down laundry, fed children, did some clean up, took care of the other critters, and am now working on the BonBons (i.e. cheese curds). After which I will care for the garden, yard work, HS and various other little things throughout the day.

Not anticipating any SS return, we invest in the 3 B’s - GAO reports or not.

Do you realize how much more someone has to make in order for their spouse to stay at home? Sometimes working 2 jobs?Do the math... higher salarie, more money deducted for Social Security. You may get a little more personal benefit, but the rest just goes into the SS pot. To me it's like the one is working/paying extra so their stay at home spouse can have benefits!! In other words, paying for their spouses benefits. Can't even address the comment devaluing a stay at home parent... just ignorant.

Oh please - speak to someone who hasn’t been there, done that!!

And when both parents work for 40+ years, the survivor get to collect only on one contribution. Someone has to make up for those who don’t work. Those two increased the pot for someone else because only ONE gets the benefit! Do the math yourself.

Did you just wake up - it’s Sept 2011.

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