Q & A

What are the implications of taking Social Security at 62 while still working?

Full Question: My wife will turn 62 in one month. She is working full time and would like to continue until 64. I will be 70 within 5 months, retired but have not applied for Social Security as yet. Can my wife apply for her Social Security at 62, continue to work (salary of $50,000 a year), not receive her Social Security payment (calculated at $757 a month at age 62), but retire at age 64 and restart her benefits? (Would her benefit increase?) At age 66 she would then be able to switch over from her Social Security benefit to the spousal benefit? Would this method work better than her waiting until age 64 to apply for benefits, at which time the ”deemed” calculation would have to be used? My FRA at 66 was $2,300 a month, so the full spousal benefit at my wife’s age 66 would be $1,150 a month.

Answer: Based on what you said, her PIA (her retirement benefit at her Full Retirement Age, or FRA) is a tad over $1,000, so delaying your larger benefit is a good choice as that will be the survivor benefit for whichever of you lives longer. Her working should mean a larger PIA for her if her earnings replace any of her lower earning years after indexing (a form of inflation adjustments) by Social Security. Read more…

SourceDan Moisand – MarketWatch – July 11, 2014


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