Breadwinner husband debates Social Security claim at 66 or 70
A reader seeks advice on whether her husband, the family breadwinner, should start Social Security benefits at age 66 or delay until 70 for an extra $800 monthly. Financial experts weigh the trade-offs between immediate income and higher lifetime payouts. The decision hinges on life expectancy, health, and family needs.
The dilemma faced by many nearing retirement is captured in a recent query to MarketWatch: with a husband serving as the primary earner, should he claim Social Security at his full retirement age of 66, or hold off until 70 to boost his monthly benefit by $800?
According to the article, the husband's current benefit at age 66 would be a baseline amount, but waiting until 70 would increase it by 8% per year past full retirement age, resulting in that additional $800 per month. This delayed claiming strategy is promoted by the Social Security Administration as a way to maximize benefits, potentially leading to higher total payouts if the individual lives longer than average.
Financial planner Michael Kitces, referenced in the piece, explains the break-even analysis: 'If you live past the break-even point, delaying is better; otherwise, claiming earlier provides more money upfront.' For this couple, the break-even age is around 80, meaning that if the husband lives beyond that, waiting pays off. However, as the breadwinner, immediate cash flow might be crucial for covering expenses or supporting a spouse.
Spousal benefits add another layer. The wife could claim her own benefits or up to 50% of her husband's at his full retirement age, but strategies like filing and suspending—now restricted—once allowed more flexibility. Current rules require careful coordination to avoid reduced survivor benefits.
Experts caution against a one-size-fits-all approach. Health factors play a role; if the husband has longevity in his family, delaying makes sense. Conversely, if health is uncertain or the family needs income now, claiming at 66 preserves liquidity. The article notes that average life expectancy for men at 66 is about 84 years, tilting slightly toward delaying for most.
Ultimately, the advice underscores consulting a financial advisor for personalized modeling, considering taxes, investment returns, and Medicare premiums, which rise with higher Social Security income. This case highlights the broader challenge for millions: balancing short-term security with long-term gains in an unpredictable retirement landscape.