When to file for Social Security benefits is an important concern for many of our clients. However, the conversation and decision haven't gotten any easier with recent congressional action that will change two claiming strategies for married couples in 2016. Here are the basics on the changes.
What's changing
Two strategies, which married couples could combine, are affected: Filing and suspending benefits and filing a restricted application for spousal benefits.
After a six-month grace period ending around May 1, 2016, if you suspend your benefit, your spouse and/or dependent children won't be able to collect a benefit based on your earning record during the time you aren't receiving one.
You will still be able to file for your Social Security benefit starting at age 62 and then suspend getting it until you reach age 70. The delay allows you to receive the 8%-per-year delayed retirement credits.
In addition, if you turn age 62 on or after January 2, 2016, and you have an earned income record of your own, you won't be able to file a restricted application. Currently, you can choose a spousal benefit instead of the one earned with your own work history. That practice lets you receive Social Security income through the spousal benefit without touching your own benefit, allowing it to keep growing. Once the new law takes effect, your client will receive whichever benefit is greater at the time he or she files, whether it's the spousal benefit or the one based on your own earning record.