Getting Your Financial Ducks In A Row Rotating Header Image

Restricted Application in 2018

You could use a machine like this to strategize your Social Security benefits filing, or you could use a restricted application.In 2018, folks who are reaching that magical age of 66, which is Full Retirement Age (or FRA, in SSA parlance), may have some decisions to make. This is especially true for married couples, or folks who were married before and are now divorced. The restricted application still applies if you were born before 1954.

Because reaching age 66 in 2018 means you were born in 1952, you are still in line for some special benefits. When the rules changed in 2015, Congress grandfathered some special options to you and your contemporaries born before 1954.

Being born before 1954 gives you the unique privilege to use the “restricted application” option when filing for benefits. (For more details on restricted application, see this article.)

This means that, if you are married to someone who also has a Social Security retirement benefit coming to them, you can (as of age 66) start taking a Spousal Benefit while delaying your own benefit to a later date. (The same applies to an unmarried divorcee who was married for at least 10 years to someone who has a Social Security benefit available.)

Restricted Application in practice

For example, Kelly and James are looking at their options for Social Security benefits. Kelly, who will reach FRA in 2018, has a potential Social Security retirement benefit of $2,000 per month available to her if she files for benefits this year. James, who worked in jobs with lower salary through his career, could have a benefit of $1,500 if he waits until he reaches his FRA in two years (he was born in 1954).

The specific set of circumstances places Kelly and James at a decision-point. Since Kelly was born before 1954, she has the option of using the restricted application – but she can’t file that application until James has filed for his own retirement benefit. Originally, they had intended for both of them to delay filing to age 70, to achieve the greatest benefit for each.

However, with the restricted application available to her, Kelly and James can put a different spin on the process. If James was to file for his own benefits in 2018 (since he’s only going to be 64 this year), he would receive a total benefit of $1,300 per month. But also, now that he’s filed, Kelly can put in a restricted application for Spousal Benefits only – which would net her $750 per month. She is still allowed to delay her own benefit up to age 70, even though she’s receiving the Spousal Benefit.

This will provide the couple with a total benefit of $2,050 per month for the coming 4 years. Then, when Kelly files for her benefit at age 70, she’ll get the full delay credits, 32%, added to her Primary Insurance Amount of $2,000. This will up her benefit to $2,640 in total, which, when added to James’ $1,300, gives the couple a total benefit of $3,940. (Given the amount of James’ PIA at $1,500, he is not eligible for a Spousal Benefit when Kelly files for her own benefit. If his PIA was something less than half of Kelly’s PIA at $2,000, he could receive an additional benefit upon her filing.)

This is less than the total benefit amount that they would have started receiving at age 70 if they had both delayed. That would have come to $4,620, because James’ benefit could have been enhanced by the delay credits to a total of $1,980.

But by using the restricted application strategy, they will receive benefits of more than $98,000 in the intervening 4 years. This works out to 12 years’ worth of the delay credits on James’ benefit – so their break-even point would be at Kelly’s age 82, James’ age 80.

Plus, regardless of the fact that he filed for his own benefit early, if Kelly dies first, James will be eligible to receive Kelly’s enhanced benefit in place of his own as a Survivor Benefit.

As with all Social Security strategies, it pays to know how it all works, in the context of your own situation. The above is just one example of how knowing the rules can make a big difference in the outcome for some folks.


  1. Rob says:

    Thanks, Jim, for providing clear information that’s difficult to find anywhere else. My wife and I are considering the restricted application plan, since she was born in 1953 and I was born in 1956. I tried calculating a break even point for us which compares the restricted application plan versus both of us waiting until age 70, and I found a later point than you did in the example above (ages 88 and 85 for us).

    I used your figures with Kelly and James, and came up with the year 2040 when both of your amounts became equal. Is it possible you overlooked the fact that when Kelly turns 70 in 2022, James will only be 68, and if he waits until age 70, he will not collect anything for 2 more years? You say the amount they would collect for 4 years amounts to 12 years of credits they would gain by waiting until 70, but isn’t this only true if they are both the same age and begin collecting at the same time? Am I considering this correctly?

    1. jblankenship says:

      Break-even analysis can be confusing. It depends on what you’re looking at for break-even. My calculation was based solely on the differential between James’ early benefit ($1,300) and his late-filing benefit ($1,980), which would be $680. If he files early and Kelly files the restricted app, they receive $98,000 during those years up to age 70. Dividing the $98k by $680, you come up with 12 years (approximately).

  2. ron manuel says:

    Several years ago I corresponded with William Reichenstein and Bill Meyer about whether there were any circumstances where both spouses could get spousal benefits. They said no. So I think this phrase is incorrect: “If his PIA was something less than half of Kelly’s PIA at $2,000, he could receive an additional benefit upon her filing.)”

    1. jblankenship says:

      The phrase is correct as written.

      I suspect that the reason Reichenstein and Meyer replied as they did may have to do with the way the question is asked. If the question is “Are there any circumstances where both spouses could get spousal benefits at the same time?” – then the answer is no. However, in the example cited, both spouses, at different times, are allowed to receive spousal benefits.

  3. ron manuel says:

    I thought the spousal was half of what the other spouse was getting. In the example, does Kelly get $750 (half of James FRA $1500) or does she get half of his actual $1300 since he is not waiting until FRA?

    1. jblankenship says:

      Spousal benefit is always based on the PIA of the other spouse, regardless of when the other spouse filed. So in the example, Kelly receives $750, half of James’ PIA (the amount he would receive if he delayed to FRA).

Get involved!

%d bloggers like this: