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Marcia Mantell

Retirement Planning > Social Security > Claiming Strategies

3 Interesting Social Security Questions Advisors Asked This Year

By Marcia Mantell

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What You Need to Know

  • Welcome to Connecting the Dots, the column where Marcia Mantell discusses real-life decisions around Social Security claiming and retirement.
  • Have your client contact the SSA if they think they may be entitled to more benefits, perhaps on an ex-spouse's record.
  • No, you can't claim your full benefit before the month you reach full retirement age.

Sometimes financial advisors run into highly unusual Social Security situations with their clients. The questions clients ask are off the beaten path and can leave advisors shaking their heads. Here are three of the most interesting questions I received in 2023.

An Ex-Spouse Would Like to Claim Her Retroactive Spousal Top-Up

An advisor landed a new client who was already collecting Social Security benefits. The new client had been divorced for many years.

Recently, the client heard she might qualify for a larger benefit by claiming on her ex-husband. She met the divorce rules, so the advisor took a look at her situation then called me with this question: Can an ex-spouse go back to Social Security to claim an ex-spousal top-up?

In theory, sure. If you are due a benefit, Social Security will pay missed benefits retroactively, back six months.

Unfortunately, in this case, the client was 82 years old and claimed 20 years ago! She didn’t know about the ex-spouse top-up and no one told her at that time.

Action steps: The client should make an appointment with the Social Security Administration to discuss her situation.

  • The SSA should have a “lead for benefits” on file from back when each ex claimed benefits. If the lead was never closed, she could be due 20 years of back payments.
  • At a minimum, she would get a six-month retroactive payment plus the top-up going forward.
  • If the ex-husband dies first, she can claim surviving ex-spousal benefits and likely see a significant boost in monthly benefits.

Ex-Wife of a Police Officer Is Looking to Claim Ex-Spousal Benefits

In another divorce case, with a much younger client, the ex-wife asked her advisor how and when to claim her ex-spousal Social Security benefits. At 60, she wants a full plan for her retirement income.

She was an at-home mom, married to a police officer for over 15 years, then divorced. Since then, she’s been working and receiving alimony.

The advisor called asking about the process and timing for her to apply for Social Security with her ex-spousal top-up.

But there’s a big problem: As a police officer, his retirement is provided by a union pension. He did not pay into FICA, and therefore has no Social Security!

Action plan: Since her earnings record includes more than 20 years of zeros, the advisor will want to outline some options:

  • Work until full retirement age to claim an unreduced benefit on her own record.
  • Work until 70, then claim her maximum benefit.
  • Discuss any possible trade-offs in lifestyle to create a viable plan.
  • Confirm with SSA that her ex does not have any covered earnings.

Meanwhile, she needs to review her divorce decree terms:

  • Is she entitled to a percentage of his pension?
  • Did she already receive a lump-sum payout?
  • Are any other payments due to her?

Can You Apply for Social Security in January of Your FRA Year?

The last off-the-beaten path question came from an advisor who was asked by a client, “If I reach my Full Retirement Age (FRA) in September, can I claim Social Security in January of that year and get my full (PIA) benefit amount all year?”

Ah, no. Creative idea, but full, unreduced benefits are only paid if you claim in your FRA month.

The client can claim in January, but that comes with a 5% permanent reduction to his benefit.

Action plan: Wait until September to claim Social Security.

Keep in Mind

Clients ask the most interesting questions or have unusual circumstances to consider. Those questions can take even the best advisors aback. Sometimes the advisor has to look for other dots to connect within the client’s financial house to figure out the best course of action.

At the end of the day, make sure the client is looking at a work record where FICA was paid in. Encourage clients who think they may be entitled to more benefits to make an appointment with Social Security. And keep in mind there is always a reduction when claiming before FRA.

Marcia Mantell

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