Changes to Social Security: Action May Be Required

In the coming weeks, the Social Security Administration will be phasing out two important benefit options. If you’re eligible, there is still time to take advantage of these strategies before it’s too late.

The following options are affected by the changes:

File and Suspend: allows you at retirement age to file for retirement benefits and suspend their collection. Doing so permits your spouse to collect spousal benefits on your earnings record.

Restricted Application for Spousal Benefit: allows you to apply for benefits based on your spouse’s record while delaying your own social security benefit. The advantage is that you receive 50% of your spouse’s benefit amount while continuing to earn delayed retirement credits of 8% a year up to a maximum age of 70.

The extent to which these changes will affect you depends on your age:

1. If you are full retirement age (66) or older by April 30, 2016:

  • You have until April 29, 2016 to exercise the File and Suspend option
  • You will be allowed to file a Restricted Application for Spousal Benefit at age 66

2. If you were age 62 or older by the end of 2015 (born January 1, 1954 or earlier)

  • You do not have the option to File and Suspend at retirement age
  • You will be allowed to file a Restricted Application for Spousal Benefit at age 66

3. If you were younger than age 62 by the end of 2015 (born January 2, 1954 or later)

  • You do not have the option to File and Suspend at retirement age
  • You are not allowed to file a Restricted Application for Spousal Benefit at retirement age

If you fall into the first category, act now to take advantage of the File and Suspend option. Even if you’re unsure if you will use the benefit, it’s wise to file by April 29, 2016 and contact a BST professional, who may be able to find ways to take advantage of this beneficial but fleeting opportunity.


Posted on February 16, 2016 at 2:35 PM