Before you can make your own calculations, you need to understand the basics. If you were born between 1943 and 1954, you can collect your "primary insurance amount" at age 66. The full retirement age gradually rises to 67 for those born between 1955 and 1960, but for this story we'll assume 66 is the full retirement age.
You can start claiming at 62, but your benefit will be permanently reduced by a fraction of a percent for each month you claim before your full retirement age. Claim at 62, and your benefits will be cut 25% compared with what you would receive if you claim at 66.
You get a delayed retirement credit of 8% for each year you wait to claim past your full retirement age until 70. Say you're due $2,000 at your full retirement age of 66. If you claim at 62, you will get $1,500. Wait until 70, and your benefit jumps to $2,640 -- 76% more than the take-it-early benefit. (And that doesn't include the cost-of-living increases that add to the benefit while you wait.)
If you're married and your primary insurance amount is less than your spouse's, you can claim either a benefit on your own record or a "spousal" benefit. If the lower earner first claims at full retirement age, the spousal benefit is 50% of the other spouse's primary insurance amount. The lower earner can't claim a spousal benefit until the other spouse files for his benefit.
Actually, a spousal benefit is two benefits: the lower earner's own benefit plus a supplement so that the total received equals up to one-half of the higher earner's benefit. Here's an illustration from Mahaney: Ken and Mary are the same age. Ken is eligible for a full benefit of $2,000, while Mary qualifies for her own $600 benefit. After subtracting Mary's full benefit from one-half of Ken's $2,000 benefit, she's eligible for a $400 spousal benefit. If they both file at 66, she gets her $600 plus the $400 spousal amount.
The size of Mary's total benefit will be reduced if she files for her own benefit earlier. Say Ken waits until 66 to file for his full $2,000 benefit. In the meantime, at 62, Mary files for her own benefit, which is reduced by 25% -- to $450. When Ken files, Mary will get her $400 spousal benefit -- for a total of $850 a month.
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: QUIZ: Test Your Social Security IQ 10 Things You Must Know About Social Security SPECIAL REPORT: Maximizing Your Social Security Benefits The opinions expressed are solely those of the author and do not necessarily reflect the views of Comcast.