New Strategies for Taking (or Delaying) Social Security Benefits

Published on January 5, 2016

coupleIn November, President Obama signed a bill that will change the way married couples (as well as certain divorced couples) may have hoped to maximize their Social Security benefits.

The Bipartisan Budget Act of 2015 eliminates the “File and Suspend” option and the “Claim Now, Claim More Later” provision, two tactics people used to employ to increase their monthly benefit. However, people who were planning to take advantage of these strategies do have a narrow window of time to do so.

First, a quick review of these strategies:

File and Suspend

Under this strategy, the higher-earning spouse can file for Social Security at full retirement age (FRA) and delay receipt of benefits until age 70 to earn delayed retirement credits (DRCs). The lower-earning spouse can then file for spousal benefits. Filing and suspending allows the higher-earning spouse’s benefit to continue to grow (and earn delayed retirement credits) while the other spouse claims and collects a spousal benefit. This ends after April 30, 2016, when spouses or other dependents will no longer be able to collect off the suspended benefit (which effectively eliminates any incentive to file and suspend).

Claim Now, Claim More Later

With the “Claim Now, Claim More Later: strategy, the higher-earning spouse reaches full retirement age and files a restricted application for spousal benefits, allowing his or her own benefit to earn DRCs (assuming the lower-earning spouse has already filed). Upon reaching age 70, the higher-earning spouse switches to his or her own benefit, which has grown with delayed retirement credits.

Under the act, if a person is entitled to both a retirement benefit and a spousal benefit at the time of filing, he or she automatically receives the larger amount of the two regardless of his or her age when filing.

People who have turned 62 by the end of 2015 are still eligible to file a restricted application.
Everyone can still delay taking Social Security and increase the benefit by eight percent for every year you don’t take the distribution, between your full retirement age and age 70.

As with anything related to your financial picture and planning for the future, it’s always a smart idea to consult your financial planner or tax professional to see if you should take advantage of either of these (File and Suspend of Claim Now, Claim More Later) while you still can. You can check the Social Security website for some helpful reference materials and information.

Self-Direct and Take Control!

Don’t let changes in Social Security upset your retirement plans. If you know and understand alternative assets, you can include them in your self-directed retirement plan and grow your savings through nontraditional investments. After all, who knows what shape the Social Security Trust Fund will be in by the time you’re ready to retire? But investment property, commodities, precious metals, hedge funds and unsecured loans could be just some of the ways you cushion the Social Security blow, by building a more eclectic (and potentially more lucrative) retirement portfolio.

Check out our website for lots of helpful information … or contact our helpful self-direction professionals with any questions you have about self-directed Traditional, Roth, SEP or SIMPLE IRAs ( or 888-857-8058). You’ll find all the forms you need under Client Forms; the documents walk you through all the required paperwork to make it easy for you to get started on your new strategy for retirement!

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