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A Strategy to Maximize Social Security Benefits

A look at how some couples can still use the ‘file and suspend’ strategy and other issues

Planning for retirement can be a daunting process that raises a host of questions. So we introduce Ask Encore as a regular feature in the Wealth Management and the Investing in Funds & ETFs reports. Written by Glenn Ruffenach, a former reporter and editor for The Wall Street Journal, and co-author of “The Wall Street Journal Complete Retirement Guidebook,” the column will examine financial issues for those thinking about, planning and living their retirement. We welcome your questions and comments at

I will be 66 in April, and my wife will be turning 65 in July. Given the new Social Security rules, what would be the most effective strategy to optimize our benefits? My wife devoted herself to a career as a full-time mother, which unfortunately means that, in the eyes of the Social Security Administration, she doesn’t qualify for retirement benefits.

Given your ages, you can still take advantage of a claiming strategy that has largely been curtailed. But you would need to act quickly. First, some background.

The Bipartisan Budget Act of 2015, enacted in November, puts an end, in most instances, to two Social Security filing strategies: “file and suspend” and a “restricted application” for spousal benefits. (You can find a summary of the changes at Search for: “new Social Security rules change claiming strategies.”)

In the months since, we have heard from numerous readers who have asked, in effect, the same question: What do I do now?

Broadly speaking, there are still steps that would-be beneficiaries can take to “optimize,” or maximize, their benefits in retirement. (Example: Each year you delay collecting Social Security between ages 62 and 70, your payout increases about 7%.) The best way to do the math is to take advantage of the growing number of tools and online advisory services that help identify an individual’s (or couple’s) optimal claiming strategy.

As for this specific question, the Budget Act has several grandfather clauses, one of which allows a person who has reached full retirement age to file and suspend—as long as the request to do so is received before April 30.

If you turn 66 before that date, you could file and suspend, which would allow your wife to begin collecting a spousal benefit. (If you plan to do this, I would book an appointment immediately with your local Social Security office, or apply online. You can do so four months before turning 66.) Meanwhile, your benefit, when you eventually claim it, will have grown in size, thanks to “delayed retirement credits.”

But again—and without knowing the specifics of your financial situation—I would urge you to run the numbers through an advisory service. Social Security remains far too complicated to try this on your own.

My husband and I have two daughters in college. How can we help them begin to build a good credit score?

Start by sitting your daughters down and explaining the possible consequences of having a bad credit score, says Beverly Harzog, a consumer-credit expert and author of “Confessions of a Credit Junkie.” As your children enter the workforce and start their own households, their bills—for an auto loan, a mortgage, health and life insurance—will likely be higher if they fail to build a strong credit history.

If you haven’t already, arrange for your daughters to be an “authorized user” on your credit-card account—and set up alerts (say, for a purchase exceeding $50) to monitor their spending. (Avoid co-signing for a credit card in a student’s own name. You will be legally responsible for making payments if your child comes up short.)

Double check that your credit-card issuer does report authorized-user information to credit bureaus, Ms. Harzog notes. Many issuers do—but not all.

At some point, look for a second form of credit: say, a gas or department-store credit card, or installment debt, such as a personal or auto loan. For students living off campus, monthly rent and utilities payments won’t do much to help credit scores. But missing such payments (including cellphone bills!) could end up being reported to credit bureaus.

Which leads, of course, to the single-most important (credit) lesson you can share with your daughters: Pay all your bills on time—every time.

If that message sticks, says Ms. Harzog, “you really empower your kids.”

In an earlier column and question about Social Security, you mentioned a “restricted application.” My wife and I are both 63 years old. She is planning to retire at 66, her full retirement age, and I plan to continue to work for an indeterminate amount of time, possibly until I turn 70. Is a restricted application still available in our situation?

Yes, you can still take advantage of this strategy—but only because you have already passed your 62nd birthday.

Under the changes in Social Security claiming strategies, workers who reached age 62 before the end of 2015 are still able to..... 

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