Help with SS for Mother-in-law

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Post Reply
Topic Author
NightFall
Posts: 269
Joined: Wed Mar 12, 2014 4:38 pm

Help with SS for Mother-in-law

Post by NightFall » Tue Dec 09, 2014 10:29 am

My mother-in-law retired last week. She will begin receiving a small pension starting in February and is planning on claiming SS at the same time. In April she will be 65, so her FRA is 66. My father-in-law is 66 and has been collecting SS for some time under disability.

As an in-law, I am not privy to much of their finances. However, according to my wife, they have little to no savings. The question is: when should she collect SS? She should be entitled to a spousal benefit, which (as I understand it) is approximately equal to her own SS benefit at her full retirement age. So, according to her, she sees no benefit in collecting a spousal benefit.

My thought was that she should wait a year to collect SS, file a restricted application to get a spousal benefit and delay her SS until 70 at which point she would get about a 30% increase in her benefits. However, it's also not clear to me that they could afford to delay her SS for a year. To complicate the situation, my father-in-law is not in great health. There is a non-trivial chance he might go before his early 70's, although he could potentially make it much longer. So if he were to pass before she reaches age 70, she would simply collect his benefit and be better off collecting her SS early. With that said, I'm no expert on SS rules, and I'd like to hear what others here think about the situation.

JW-Retired
Posts: 7154
Joined: Sun Dec 16, 2007 12:25 pm

Re: Help with SS for Mother-in-law

Post by JW-Retired » Tue Dec 09, 2014 11:17 am

Your understanding is absolutely correct. The best long term idea is to take the spousal benefit at age 66 in lieu of her own (approximately equal) benefit, and delay hers until 70 when it will be a third larger. It's a total no-brainer, unless they just have insufficient money to live on for the 16 months to go until she is 66. Can you cover that extra monthly income they need for her to delay until she can do the spousal at 66?
JW
Retired at Last

Topic Author
NightFall
Posts: 269
Joined: Wed Mar 12, 2014 4:38 pm

Re: Help with SS for Mother-in-law

Post by NightFall » Wed Dec 10, 2014 7:17 am

Thanks. Covering the short fall for a year or so is a possibility. I guess another way of looking at it would be the break even point. She would be 73 before the increase in SS would offset the first year and such an increase would only last until her husband passes. Is there any option for retroactively starting payments at an earlier date with SS? For example, if she has been collecting her spousal benefit and he passes when she is 69, could she file to receive the extra payments as if she had started at 65?

Post Reply