Social Security Claiming: The Case Where Timing Doesn't Matter Much

The best approach, according to the authors, would be for Sandy to have filed for a reduced worker benefit of $1,290 in January 2024. Then, in February 2025, she files for the full survivor benefit, resulting in a total projected lifetime benefit of $667,829.

Bonus Insights: An Important Word on Survivors

Marcia Mantell, a Social Security claiming expert, recently wrote an article for ThinkAdvisor examining a case in which a relatively young surviving spouse is facing a similar set of considerations.

In addition to Mantell running the numbers herself, her analysis also warns advisors that estimates provided by the Social Security Administration in such cases do not provide enough information for an informed claiming decision.

On one hand, it is typically best for widows to delay their biggest benefit until it’s maximized, but even that general rule leaves advisors with dots to connect, Mantell warned.

Additional critical pieces of information include:

Is she still working? If so, how much does she earn? The earnings limit test applies to both worker benefits and survivor benefits.
Does she also have a public pension from uncovered wages? That would reduce her own benefit by the Windfall Elimination Provision and her survivor benefit by the Government Pension Offset.
Has she remarried? If so, at what age?

“Unless she needs to start her best benefit early, it is not a recommended strategy,” Mantell concluded. “Starting her largest benefit now will deliver a substantially smaller benefit throughout her oldest years. Annual cost-of-living adjustments are based on her starting benefit amount, which will be significantly smaller.”

As in Sandy’s case, by waiting to claim her highest benefit at her survivor full retirement age, Mantell’s case can still start her own benefits sooner, then maximize her bigger survivor benefit.

“That would result in an increase of more than $550 a month,” Mantell noted. “It’s worth waiting if possible.”

Credit: Chris Nicholls/ALM