OpenSocialSecurity.com

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Post Reply
Topic Author
Retired CPA
Posts: 23
Joined: Mon Jan 30, 2017 8:15 pm
Location: Ventura, CA

OpenSocialSecurity.com

Post by Retired CPA » Sun Oct 20, 2019 9:58 am

I, like countless others on this forum, have benefitted from this wonderful resource to chart our claiming strategy. However, with my wife suffering a stroke in March, and with her mortality potentially affected by this, I thought it might be helpful to revisit the calculator for a likely revision to our claiming strategy.

My wife claimed her benefits (PIA $333) in January 2017 at age 64 years, 1 month. I have yet to claim my benefits (current PIA $2,929) as of age 65 years, 6 months.

With revised input as to my spouse’s life expectancy (same result up to age 80), the recommended strategy now is to claim my benefits this month, for my spouse to suspend her present benefits today, file for her spousal benefit this month, then to unsuspend her benefit in December.

While I understand the strategy behind filing for my benefits now, along with the spousal benefits, I am at a loss in understanding why the model is advising my spouse to suspend her current benefit “today” and then unsuspending said benefit in December, at age 67. I may likely be unaware of some arcane social security benefit claiming rule with respect to spousal benefits.

Thank you in advance for your valued wisdom.

User avatar
tfb
Posts: 8156
Joined: Mon Feb 19, 2007 5:46 pm
Contact:

Re: OpenSocialSecurity.com

Post by tfb » Sun Oct 20, 2019 10:29 am

Retired CPA wrote:
Sun Oct 20, 2019 9:58 am
While I understand the strategy behind filing for my benefits now, along with the spousal benefits, I am at a loss in understanding why the model is advising my spouse to suspend her current benefit “today” and then unsuspending said benefit in December, at age 67. I may likely be unaware of some arcane social security benefit claiming rule with respect to spousal benefits.
Use the "Test an alternative claiming strategy" feature at the bottom of the result page and compare with a more "normal" strategy, such as not suspending, or suspending for a longer period. You may see the difference in the present value is very small. The calculator only picks the absolute maximum even when the difference is tiny over the lifetime.
Harry Sit, taking a break from the forums.

Topic Author
Retired CPA
Posts: 23
Joined: Mon Jan 30, 2017 8:15 pm
Location: Ventura, CA

Re: OpenSocialSecurity.com

Post by Retired CPA » Sun Oct 20, 2019 3:28 pm

Thank you, tfb. You are indeed correct in that the NPV difference was minimal without suspending benefits. I believe that I may be starting to understand the reason for the recommended suspension of benefits. As my spouse began benefits prior to reaching her FRA, the suspension period, as short as it is, could be suggested as a way for her to earn additional deferral credits, while receiving spousal benefits, since she was born prior to 1/1/54.
Last edited by Retired CPA on Sun Oct 20, 2019 4:52 pm, edited 1 time in total.

User avatar
ObliviousInvestor
Posts: 3587
Joined: Tue Mar 17, 2009 9:32 am
Contact:

Re: OpenSocialSecurity.com

Post by ObliviousInvestor » Sun Oct 20, 2019 4:16 pm

Retired CPA, I'd be happy to look into it to see if I can provide further explanation, but I'd need to know all of the inputs used so that I can recreate the calculation.
Mike Piper, author/blogger

TBillT
Posts: 799
Joined: Sat Sep 17, 2011 1:43 pm

Re: OpenSocialSecurity.com

Post by TBillT » Mon Oct 21, 2019 10:45 am

deleted
Last edited by TBillT on Mon Oct 21, 2019 10:57 am, edited 1 time in total.

User avatar
ObliviousInvestor
Posts: 3587
Joined: Tue Mar 17, 2009 9:32 am
Contact:

Re: OpenSocialSecurity.com

Post by ObliviousInvestor » Mon Oct 21, 2019 10:54 am

TBillT wrote:
Mon Oct 21, 2019 10:45 am
Ages I assume are critical, sounds like the OP turned 65 in 2019, so just missed the restricted appl opportunity that would apply for those 65 before 2-Jan-2019. But maybe the spouse was 65 before 2019, so would qualify?
Yes, month/year of birth is a critical input. In this case though restricted application would not be relevant for the wife, for two reasons:
1) She already filed for her own retirement benefit (and therefore isn't eligible for a restricted application), and
2) Even if she hadn't, her own benefit if allowed to grow until 70 would still be smaller than her benefit as a spouse.
Mike Piper, author/blogger

TBillT
Posts: 799
Joined: Sat Sep 17, 2011 1:43 pm

Re: OpenSocialSecurity.com

Post by TBillT » Mon Oct 21, 2019 10:59 am

ObliviousInvestor wrote:
Mon Oct 21, 2019 10:54 am
TBillT wrote:
Mon Oct 21, 2019 10:45 am
Ages I assume are critical, sounds like the OP turned 65 in 2019, so just missed the restricted appl opportunity that would apply for those 65 before 2-Jan-2019. But maybe the spouse was 65 before 2019, so would qualify?
Yes, month/year of birth is a critical input. In this case though restricted application would not be relevant for the wife, for two reasons:
1) She already filed for her own retirement benefit (and therefore isn't eligible for a restricted application), and
2) Even if she hadn't, her own benefit if allowed to grow until 70 would still be smaller than her benefit as a spouse.
Yes you are quick you got me before i had a chance to edit...I see the calcs did not work out like I thought.
Thnak you for the tool!

Topic Author
Retired CPA
Posts: 23
Joined: Mon Jan 30, 2017 8:15 pm
Location: Ventura, CA

Re: OpenSocialSecurity.com

Post by Retired CPA » Mon Oct 21, 2019 2:33 pm

Mike, that is so generous of you to offer to do that, and I am most appreciative of your calculator. I have entered the same inputs again this morning, and this time the recommended strategy does not reflect any suspension of my spouse's benefits, just the immediate filing for my benefits and my spouse's spousal benefits. Thank you again!

Post Reply