There are few free lunches in retirement planning. For married couples, a Social Security claiming strategy known as "file and suspend" may be one of them.
Here's how it works: A person files for Social Security retirement benefits at full retirement age, but then suspends payment of them. By filing for benefits, that person's spouse and dependents are eligible for retirement benefits at the time of the filing. And by suspending the benefits, the person can still earn delayed retirement credits that increase the future retirement benefit by 8 percent per year until age 70.
"People are leaving money on the table," said David Leland, a Merrill Lynch financial advisor in Beverly, Mass. "It's not as simple as both spouses maxing out their Social Security by waiting to claim them at age 70. Couples may be missing out on benefits for lack of knowing."