Ask Larry: How Can I Determine When My Social Security Retirement Benefit Will Be $2,000?
Today’s Social Security column addresses questions about figuring benefit rates, taking retirement benefits before later divorced spousal benefits and whether the 5.9% COLA applies to all benefits. Larry Kotlikoff is a Professor of Economics at Boston University and the founder and president of Economic Security Planning, Inc.
See more Ask Larry answers here.
Have Social Security questions of your own you’d like answered? Ask Larry about Social Security here.
How Can I Determine When My Social Security Retirement Benefit Will Be $2,000?
Hi Larry, I am 64 and eight months. If I started to collect Social Security today, I would receive about $1,750. I want to start collecting when I get to $2,000. How do I figure at what age that would be? The sliding scale on the SSA site does not include the 5.9% increase at this time as it is prior to it going into effect. Thanks, Alice
Hi Alice, I would start by calculating your primary insurance amount (PIA), which is the amount you’d be paid if you start drawing at your full retirement age of 66 and six months. For each month that you start drawing prior to your FRA, your benefit rate would be 5/9ths of 1% lower than your PIA. Or for each month you wait past FRA to start drawing your benefit rate would be 2/3rds of 1% higher than your PIA.
The benefit calculator in my company’s software — Maximize My Social Security or MaxiFi Planner —could do all of the necessary math for you, as well as analyze all of your filing options so that you can determine your best strategy for maximizing your benefits. Social Security calculators provided by other companies or non-profits may provide proper suggestions if they were built with extreme care. Best, Larry
Can I Take My Own Benefits At Full Retirement Age And Switch To Divorced Spousal Benefits?
Hi Larry, I’m planning on filing for divorced spousal benefits. Can I take my retirement benefit at 67 and then switch to divorced spousal benefits at his full retirement age, which is 18 months after mine. Thanks, Debby
Hi Debby, People born after 1/1/1954 are not allowed to apply for spousal, divorced spousal, or their own Social Security retirement benefits without being deemed to have applied for all of those benefits. So the only way that you could claim your own benefits without claiming your divorced spousal benefits at the same time is if you aren’t yet eligible for divorced spousal benefits when you apply for your own benefits.
And as long as both you and your ex-husband are at least 62 and if your divorce has been final for at least two years, then you’d be potentially eligible for divorced spousal benefits as long as your ex-spouse’s primary insurance amount (PIA) is more than twice as much as your own PIA.
Furthermore, you can’t start drawing your own benefits first and then switch to another type of benefit later. Once you claim your own benefits, if you also qualify for another type of benefit you’d be paid your own benefit plus a partial, or excess, auxiliary (e.g. spousal, divorced spousal) or survivor benefit.
Even if you were allowed to do what you suggest in your question though, it wouldn’t be a wise strategy. If you’re eligible for divorced spousal benefits and if you file for them at your full retirement age (FRA) or later then your divorced spousal rate wouldn’t be reduced for age even if your ex-husband hasn’t yet reached FRA. In other words, you would gain nothing by waiting past your FRA to claim any divorced spousal benefits for which you qualify, even if your ex-husband is younger than you are. Best, Larry
Is There Any Reason For My DWB Benefit Not Increasing By The Full 5.9% COLA?
Hi Larry, A 5.9% COLA has been applied to my SSDI but not to my DWB benefits. My DWB benefit increased only $30 per month (a 3.25% increase). Is there a reason for this? Thanks, Yvonne
Hi Yvonne, I don’t know of any reason why the 5.9% increase wouldn’t apply to both of your benefits. Disabled widow’s benefits (DWB) are reduced for age, but your gross amount should still go up by roughly 5.9% once the cost of living (COLA) increase is applied.
The base monthly Part B Medicare premium rate is increasing by $21.60 in 2022, but that wouldn’t affect the increase your gross benefit rate. Still though, if you have Part B premiums deducted from your benefits then your net benefit increase will amount to somewhat less than 5.9%. In any case though, if you don’t think that your benefit rate is correct you should probably call Social Security to try to get an explanation. Best, Larry