3. Failing to Optimize Spousal Benefits

Couples often analyze their Social Security options in isolation, viewing their individual work records as standalone silos. This narrow perspective leads to massive missed opportunities regarding spousal benefits. The rules stipulate that a lower-earning spouse can claim a benefit based on their own earnings record, or they can claim a spousal benefit worth up to 50 percent of the higher-earning spouse’s primary insurance amount—whichever is greater.

Two critical rules govern this strategy. First, the higher-earning spouse must actually file for their own retirement benefits before the lower-earning spouse can claim a spousal benefit. You can no longer utilize the old “file and suspend” loophole that was eliminated by the Bipartisan Budget Act of 2015. Second, spousal benefits do not earn delayed retirement credits. If your maximum spousal benefit is 50 percent of your partner’s FRA amount, waiting past your own full retirement age to claim the spousal benefit gains you nothing. The benefit maxes out at your full retirement age.

Coordinating the exact timing of when the higher earner files so the lower earner can step up to the spousal benefit requires meticulous planning. Failing to synchronize these applications leaves substantial household income sitting in government coffers.