SSA Spousal Benefits assumptions

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JDTHOOSIER
Posts: 33
Joined: Tue Jun 13, 2017 6:09 pm

SSA Spousal Benefits assumptions

Post by JDTHOOSIER » Mon Oct 30, 2017 3:48 pm

Sorry for posting a new thread. I did search all previous threads, and picked up the recommended book by Mike Piper. I would appreciate a sanity check to ensure my understanding and my assumptions are on the right track:

Me - age 59, PIA at FRA: 2797, PIA at 70: 3574
Wife - age 58, PIA at FRA: 1234, PIA at 70: 1586

If I have the understanding correct, then we should:

a) Wife claims her PIA at her FRA, our benefit is $1234/month.
b) At 70, I claim my PIA, $3574/month, so our total benefit is now $4808/month
c) After I claim, my wife can then claim her spousal benefit at 50%, roughly $1787/month, bringing our total to $5361/month.

Are these assumptions correct?

Thanks!

soccerrules
Posts: 157
Joined: Mon Nov 14, 2016 4:01 pm

Re: SSA Spousal Benefits assumptions

Post by soccerrules » Mon Oct 30, 2017 3:54 pm

JDTHOOSIER wrote:
Mon Oct 30, 2017 3:48 pm
Sorry for posting a new thread. I did search all previous threads, and picked up the recommended book by Mike Piper. I would appreciate a sanity check to ensure my understanding and my assumptions are on the right track:

Me - age 59, PIA at FRA: 2797, PIA at 70: 3574
Wife - age 58, PIA at FRA: 1234, PIA at 70: 1586

If I have the understanding correct, then we should:

a) Wife claims her PIA at her FRA, our benefit is $1234/month.
b) At 70, I claim my PIA, $3574/month, so our total benefit is now $4808/month
c) After I claim, my wife can then claim her spousal benefit at 50%, roughly $1787/month, bringing our total to $5361/month.

Are these assumptions correct?

Thanks!
from my understanding.
A and B - Yes.
C - No. the 50% spousal benefit is tied to PIA at FRA, not at 70. (in your case $2,797) she would get 50% of $2797, or $1398. Technically according to SSA she will get her benefit $1,234 plus the difference of $164 to get to $1,398.
Don't let your outflow exceed your income or your upkeep will be your downfall.

delamer
Posts: 3078
Joined: Tue Feb 08, 2011 6:13 pm

Re: SSA Spousal Benefits assumptions

Post by delamer » Mon Oct 30, 2017 3:59 pm

Your wife's spousal is only half of your PIA at your FRA, even if you wait until age 70 to claim. So half of $2797 or $1398.50, not $1787 (as in c).

If you don't claim until 70 and you predecease her, then her survivor benefit would be the $3574. So delaying past your FRA increases her survivor benefit but not her spousal benefit.

Also the term PIA only pertains at full retirement age -- from ssa.gov

PIA definition
The "primary insurance amount" (PIA) is the benefit (before rounding down to next lower whole dollar) a person would receive if he/she elects to begin receiving retirement benefits at his/her normal retirement age. At this age, the benefit is neither reduced for early retirement nor increased for delayed retirement.

Penguin
Posts: 537
Joined: Sat Mar 03, 2007 1:52 pm

Re: SSA Spousal Benefits assumptions

Post by Penguin » Mon Oct 30, 2017 4:01 pm

JDTHOOSIER wrote:
Mon Oct 30, 2017 3:48 pm
a) Wife claims her PIA at her FRA, our benefit is $1234/month.
I think you are correct.
JDTHOOSIER wrote:
Mon Oct 30, 2017 3:48 pm
At 70, I claim my PIA, $3574/month, so our total benefit is now $4808/month
The PIA means primary insurance amount. That is what you collect at your full retirement age. The amount you collect at age 70 is not called PIA, but the numbers look correct.
JDTHOOSIER wrote:
Mon Oct 30, 2017 3:48 pm
c) After I claim, my wife can then claim her spousal benefit at 50%, roughly $1787/month, bringing our total to $5361/month.
Her spousal benefit is 50% of your PIA at your FRA. It is 50% of $2797. Her spousal benefit would be $1398. The benefit for the two of you would be $4972.
Jon

123
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Re: SSA Spousal Benefits assumptions

Post by 123 » Mon Oct 30, 2017 4:04 pm

They may not be entirely correct.

If the higher "PIA" you indicated at age 70 is due to Delayed Retirement Credits (DRCs) at 8% a year from your FRA to age 70 those would NOT increase the benefit payable to a living spouse. If the higher PIA you indicated at age 70 is due to additional covered work and earnings then the higher PIA would also increase the benefit to a living spouse. DRCs impact your benefit as well as those of your surviving spouse but not your living spouse.
The closest helping hand is at the end of your own arm.

JDTHOOSIER
Posts: 33
Joined: Tue Jun 13, 2017 6:09 pm

Re: SSA Spousal Benefits assumptions

Post by JDTHOOSIER » Mon Oct 30, 2017 5:39 pm

Thanks for the feedback. I went back to the book and saw where I misunderstood. I think it takes about 3 runs through the book to get it all right.

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