Just because clients can't pursue a file-and-suspend Social Security claiming strategy doesn't mean they don't have options.  

Bouquet Boulter, a Raymond James financial planner with Southside Bank in Tyler, Texas, helped her client understand that. The client, 64, was distressed because he had planned to use the popular file-and-suspend play, meaning he would file for and immediately suspend his Social Security benefits. This would enable his wife to claim spousal benefits while giving his own benefit the opportunity to grow 8% annually. 

This widely used claiming strategy, however, will no longer be available after April 30. At that point, workers must be full retirement age, or 66, to employ this option.

Boulter's client, therefore, was a little too young to file and suspend. He had planned to use this tactic to better provide for his wife in the event he died.  By delaying his benefit, she would be able to receive a higher survivor's benefit.

"If something happens to me, my wife, when I die, will be able to get that higher Social Security benefit amount because I waited, so I feel like I'm taking care of her," he explained to Boulter.

Boulter's client would be eligible for $2,267 monthly at 66. By 70, that would grow to $2,992. Without the ability to suspend his application, however, his wife would never get more than $2,267, should he die.

Another Option

Boulter quickly pointed out another claiming strategy. What the disheartened client hadn't considered, she said, was the wife's monthly benefit, which at full retirement would be $759 a month.

Boulter suggested that the wife, 63, file for her Social Security benefit when she turned 66, a move that would give her husband the ability to file a "restricted application" for spousal benefits. That meant Boulter's client would be eligible for a spousal benefit of $380 a month, or half of his wife's benefit. 

"What?" the client said stupefied.  "I didn't know she could do that."

And that was just part one of the strategy that Boulter laid out for the client.  He and his wife would receive their respective monthly benefit checks of $759 and $380 until he hit 70, at which time he would claim his $2,992 Social Security monthly benefit on his own work record.  This, in turn, would allow the wife to switch from her $759 monthly benefit to a spousal benefit of $1,496, or half of her husband's 2,267 benefit at his full retirement age.

By following this strategy, they would achieve virtually the same end result that a file-and-suspend strategy would have achieved, with one difference.  Both would be receiving benefits between ages 66 and 70, rather than just the client's wife.

"I can't even comprehend that," Boulter's client said. "I am so glad I came to see you because I had no idea that that could even be something that we could do."

If Boulter's client lives to 90 and his wife to 93, they will receive a total of $1,224,360 in Social Security benefits, according to the Social Security maximization tool on Raymond James' Goal Planning and Monitoring software program.  Had Boulter's client claimed his benefit at 66 to allow his wife to receive spousal benefits, they would have received just $1,115,364, or nearly $109,000 less.

"It gave him peace of mind," Boulter said of her client. "He was wowed that he didn't lose out."

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