Social Security Claiming: The Case of a Couple's Many Choices

This is the latest in a series of biweekly articles featuring Social Security claiming case studies drawn from the ALM publication “2024 Social Security & Medicare Facts,” by Michael Thomas with support from Jim Blair, a former Social Security administrator, and Marc Kiner, a planning expert with extensive experience in public accounting.

The Scenario: An Age Gap and Unequal Earnings

Paul and Kirsten are a married couple five years apart in age.

Having been born in December 1958, Paul will reach full retirement age at age 66 and eight months, at which time his full worker benefit is $2,418. Kirsten, born in December 1963, will reach full retirement age at age 67.

Given her lower lifetime earnings relative to Paul, Kirsten’s full worker benefit is $1,182.

Kirsten has an actuarially projected death age of 87 and is expected to survive Paul by about eight years. Paul’s projected death age, in turn, is 84.

The couple has as many as nine claiming scenarios to consider, and the difference in projected lifetime payments between the most- and least-optimal approach is nearly $130,000. Particularly important to the outcome is the link between Paul’s claiming decision and Kirsten’s anticipated survivor benefit.

What the Numbers Show

The least effective claiming strategy analyzed by the authors would have seen Paul file for a reduced worker benefit in January, garnering him a monthly benefit of $2,162. Kirsten is assumed to file in December 2033 for her maximum worker benefit of $1,465, and she eventually switches to a survivor benefit of $2,162.

This results in a projected lifetime benefit for the couple of $877,611.

A small jump in benefits comes from assuming that Paul makes the same claiming decision, while Kirsten elects to file at age 62 in January 2026 for a reduced worker benefit of $832. Kirsten also files at this time for a spousal benefit that “tops off” her own benefit, raising it to $849.

Kirsten eventually switches to the survivor benefit ($2,162), resulting in a projected lifetime benefit of $887,426.