Roby FinancialTyrone ClarenceFinancial Services Professional5865 W. Hidden Springs DrBoise, ID 83714208-229-7629208-724-8780t.clarence@jwcemail.com

Social Security ClaimingStrategies for Married Couples

October 27, 2014

Deciding when to begin receiving Social Securitybenefits is a major financial issue for anyoneapproaching retirement because the age at which youapply for benefits will affect the amount you'll receive.If you're married, this decision can be especiallycomplicated because you and your spouse will needto plan together, taking into account the SocialSecurity benefits you may each be entitled to. Forexample, married couples may qualify for retirementbenefits based on their own earnings records, and/orfor spousal benefits based on their spouse's earningsrecord. In addition, a surviving spouse may qualify forwidow or widower's benefits based on what his or herspouse was receiving.

Fortunately, there are a couple of planningopportunities available that you may be able to use toboost both your Social Security retirement incomeand income for your surviving spouse. Both can beused in a variety of scenarios, but here's how theygenerally work.

File and suspendGenerally, a husband or wife is entitled to receive thehigher of his or her own Social Security retirementbenefit (a worker's benefit) or as much as 50% ofwhat his or her spouse is entitled to receive at fullretirement age (a spousal benefit). But here's thecatch: under Social Security rules, a husband or wifewho is eligible to file for spousal benefits based on hisor her spouse's record cannot do so until his or herspouse begins collecting retirement benefits.However, there is an exception--someone who hasreached full retirement age but who doesn't want tobegin collecting retirement benefits right away maychoose to file an application for retirement benefits,then immediately request to have those benefitssuspended, so that his or her eligible spouse can filefor spousal benefits.

The file-and-suspend strategy is most commonlyused when one spouse has much lower lifetimeearnings, and thus will receive a higher retirementbenefit based on his or her spouse's earnings record

than on his or her own earnings record. Using thisstrategy can potentially boost retirement income inthree ways.

1. The spouse with higher earnings who hassuspended benefits can accrue delayed retirementcredits at a rate of 8% per year (the rate foranyone born in 1943 or later) up until age 70,thereby increasing his or her retirement benefit byas much as 32%.

2. The spouse with lower earnings can immediatelyclaim a higher (spousal) benefit.

3. Any survivor's benefit available to thelower-earning spouse will also increase because asurviving spouse generally receives a benefitequal to 100% of the monthly retirement benefitthe other spouse was receiving (or was entitled toreceive) at the time of his or her death.

Here's a hypothetical example. Leslie is about toreach her full retirement age of 66, but she wants topostpone filing for Social Security benefits so that shecan increase her monthly retirement benefit from$2,000 at full retirement age to $2,640 at age 70(32% more). However, her husband Lou (who hashad substantially lower lifetime earnings) wants toretire in a few months at his full retirement age (also66). He will be eligible for a higher monthly spousalbenefit based on Leslie's work record than on hisown--$1,000 vs. $700. So that Lou can receive thehigher spousal benefit as soon as he retires, Lesliefiles an application for benefits, but then immediatelysuspends it. Leslie can then earn delayed retirementcredits, resulting in a higher retirement benefit for herat age 70 and a higher widower's benefit for Lou inthe event of her death.

File for one benefit, then the otherAnother strategy that can be used to increasehousehold income for retirees is to have one spousefile for spousal benefits first, then switch to his or herown higher retirement benefit later.

Once a spouse reaches full retirement age and is

Every situation is unique,so these strategies maynot be appropriate for allcouples. When decidingwhen to apply for SocialSecurity benefits, makesure to consider anumber of scenarios thattake into account factorssuch as both spouses'ages, estimated benefitentitlements, and lifeexpectancies.

Page 1 of 2, see disclaimer on final page

Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2014

IMPORTANT DISCLOSURES

Broadridge Investor Communication Solutions, Inc. does not provide investment, tax, or legal advice. The information presented here is notspecific to any individual's personal circumstances.

To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purposeof avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or herindividual circumstances.

These materials are provided for general information and educational purposes based upon publicly available information from sources believedto be reliable—we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any timeand without notice.

eligible for a spousal benefit based on his or herspouse's earnings record and a retirement benefitbased on his or her own earnings record, he or shecan choose to file a restricted application for spousalbenefits, then delay applying for retirement benefitson his or her own earnings record (up until age 70) inorder to earn delayed retirement credits. This mayhelp to maximize survivor's income as well asretirement income, because the surviving spouse willbe eligible for the greater of his or her own benefit or100% of the spouse's benefit.

This strategy can be used in a variety of scenarios,but here's one hypothetical example that illustrateshow it might be used when both spouses havesubstantial earnings but don't want to postponeapplying for benefits altogether. Liz files for her SocialSecurity retirement benefit of $2,400 per month atage 66 (based on her own earnings record), but herhusband Tim wants to wait until age 70 to file. At age66 (his full retirement age) Tim applies for spousalbenefits based on Liz's earnings record (Liz hasalready filed for benefits) and receives 50% of Liz'sbenefit amount ($1,200 per month). He then delaysapplying for benefits based on his own earningsrecord ($2,100 per month at full retirement age) sothat he can earn delayed retirement credits. At age70, Tim switches from collecting a spousal benefit tohis own larger worker's retirement benefit of $2,772per month (32% higher than at age 66). This not onlyincreases Liz and Tim's household income but alsoenables Liz to receive a larger survivor's benefit in theevent of Tim's death.

Things to keep in mind• Deciding when to begin receiving Social Security

benefits is a complicated decision. You'll need toconsider a number of scenarios, and take intoaccount factors such as both spouses' ages,estimated benefit entitlements, and lifeexpectancies. A Social Security representativecan't give you advice, but can help explain youroptions.

• Using the file-and-suspend strategy may not beadvantageous when one spouse is in poor healthor when Social Security income is needed as soonas possible.

• Delaying Social Security income may have taxconsequences--consult a tax professional.

• Spousal or survivor's benefits are generallyreduced by a certain percentage if received beforefull retirement age.

For more informationabout your options andthe benefit applicationprocess, contact theSocial SecurityAdministration at (800)772-1213 or visitwww.socialsecurity.gov.

Page 2 of 2