File-and-suspend has become a popular strategy for married couples who want to get the most from their Social Security benefits. It lets them earn credits for delayed filing and bring in some Social Security income while they wait.
Here is the most common way to use file-and-suspend:
The spouse with the higher benefit files at his or her full retirement age (FRA), then immediately files a notice to suspend payment of those benefits. That permits the spouse with the lower primary insurance amount (PIA) to file for a spousal benefit, which is equal to half the higher earner’s benefit.
That gets some income flowing to the household while the higher earner continues to accrue higher benefits. The higher earner can wait until age 70 to begin benefits; the lower earner then converts to his or her own full benefit.
The couple receives higher individual benefits for the rest of their lives. If the husband dies first, the widow then converts to a survivor benefit, equal to 100 percent of her spouse’s benefit.
But the White House has proposed eliminating it on grounds that it’s a loophole mainly benefiting upper-income households. So if you’ve been thinking about filing and suspending your Social Security benefits, you better do it while you still can.