One of the biggest Social Security mistakes I see is married couples treating their benefits as two separate decisions.
They’re not.
In many households, I want to look closely at having the main breadwinner, the spouse with the larger Social Security benefit, delay as long as reasonably possible, potentially to age 70.
Why?
Because you’re not only planning for today. You’re planning for the spouse who lives the longest.
When one spouse passes away, the household generally doesn’t keep receiving both full Social Security checks. The surviving spouse may be eligible for the larger applicable survivor benefit.
So maximizing the higher earner’s benefit can also mean creating a stronger income foundation for the surviving spouse.
Meanwhile, depending on the couple’s situation, we can evaluate whether it makes sense for the lower-earning spouse to begin Social Security earlier.
And here’s something people often overlook:
Just because you collect Social Security doesn’t mean you have to spend it.
If you don’t need that check for your monthly expenses, it can potentially be saved or invested while the higher earner continues delaying their larger benefit.
But Social Security is only one room in your financial house.
A retirement-account withdrawal or Roth conversion can affect taxable income.
Taxable income can affect how much of your Social Security is taxable.
And higher income can potentially affect Medicare premiums through IRMAA.
One decision can travel through your entire financial house.
That’s why I don’t believe Social Security, Medicare, taxes, and retirement income should be planned separately.
As I explain in How Social Security, Medicare and Taxes Work Together in Retirement, these decisions can affect one another and should be considered as part of the bigger retirement picture.
They should all be part of one Retirement Blueprint.
There is no one claiming strategy that works for every couple. Health, longevity, work status, age differences, taxes, other income, and Social Security rules all matter.
But before either spouse turns on Social Security, ask a bigger question:
“How does this decision affect the rest of our financial house, and the spouse who lives the longest?”
That’s retirement planning.
That’s what it means to build financial security for life.
If you’re approaching retirement and wondering how Social Security, Medicare, taxes, and retirement income all fit together, The Retirement Blueprint can help you look at the bigger picture. It’s designed to bring the different rooms of your financial house together into one coordinated retirement strategy built around your goals and your future.
Sources and further reading
Educational disclaimer: This material is provided for general educational and informational purposes only. It is not intended as personalised investment, tax, legal, insurance, Medicare or financial advice, and it does not recommend any specific strategy or product. Rules, costs and individual circumstances can change. Consult appropriately qualified professionals before making decisions about your situation.
