Social Security: How to Double Dip

Financial advisers should consider the Baby Boomer's Guide to Social Security a keeper, assuming they have access to the online WSJ.

Did you know, for instance, that a married man who waits until age 70 to collect his retirement benefit (thus qualifying for a significantly larger monthly payment) may be able to collect a spousal benefit in the meantime?

Here's how the WSJ explains it:

George, at his full retirement age of 66, expects a benefit of $2,000 a month. His wife, Martha, at her full retirement age of 66, expects a benefit of $1,000 a month.

The strategy: Martha files for a reduced benefit on her own at age 63, or $800 a month. George, at age 66, files for just a spousal benefit, based on Martha's earnings. He would get $500 a month as Martha's spouse. (Yes, Social Security allows George to get half of what Martha was projected to receive at her full retirement age.) Then, at age 70, George applies for benefits based on his earnings history. With the "delayed retirement credit" (the additional dollars one receives for waiting until age 70 to claim Social Security), George's benefit would be 32% higher, or $2,640 a month.

Social Security would stop George's spousal benefit of $500 a month because he's entitled to the $2,640, based on his own earnings, at age 70. Again, for this to work, George must wait until his full retirement age or later to file for a spousal benefit.

Caution: Serial double-dipping is such a cool gambit that even some Social Security officials don't know about it.