Making educated decisions about Social Security

The Savings Game

After a recent column about optimizing your Social Security benefits, I received a lot of mail from readers wanting to know more — and to share their frustration.

Unfortunately, many readers complained that when they contacted the Social Security Administration (SSA), they received contradictory information from different representatives. Even when readers cited information from “Get What’s Yours” by Kotlikoff, Moeller and Solman, or “Social Security: The Inside Story” by Andy Landis — both reliable guides on the subject — they were sometimes contradicted by SSA representatives. Let me address two common issues readers raised. File and suspend. Many readers have written about this powerful tool. If you have reached full retirement age (FRA), you may apply for benefits and voluntarily suspend them. This permits your spouse to receive spousal benefits, while your own benefit increases by 8 percent for every year you suspend up until age 70.

If you wait until 70, benefits will automatically start then. Your spouse can apply for spousal benefits at 62, but will not receive full benefits. Waiting until FRA entitles the spouse to 50 percent of your FRA benefit. In this situation, the spouse’s benefit, based on her/his work record, will increase 8 percent for every year he/she suspends until age 70. After that point, benefits based on the work record kick in. This would be advantageous if that benefit exceeds the spousal benefit.

Many Social Security representatives were unfamiliar with the “file and suspend” option or told callers that it was not applicable to them, without a satisfactory explanation. If you call SSA, and the representative indicates he is not familiar