We’ve previously examined several key pieces of information to keep in mind while working on Social Security planning. A great deal of this information has been in relation to an individual’s planning; when looking at Social Security strategies for married couples, the discussion can become far more complex. While there can be dozens of different ways for married couples to file for benefits, we’ll share an overview of Social Security’s spousal and survivor’s benefits to keep in mind, no matter your circumstances as a parent, spouse, former spouse, or widow(er).
As a spouse, you have the choice to simply collect Social Security benefits on your own if you’ve earned the necessary work credits. However, if you’re a lower earner than your spouse or have never worked, you may be able to receive up to half of your spouse’s full benefit. Some spouses qualify for both their own retirement benefit and spousal benefits; the Social Security Administration (SSA) notes that for people who are eligible for both, the individual’s own benefits are paid first. The SSA adds that “If your benefits as a spouse are higher than your own retirement benefit, you’ll get a combination of benefits equaling the higher spouse benefit.”
A divorced spouse may also collect benefits from his/her ex-spouse; the collector must be 62 or older and unmarried. An ex-spouse collecting benefits will not reduce or alter your own benefits.
In addition to spouses, benefits also extend to children in many cases. Upon a worker collecting Social Security benefits, his/her dependent biological, adopted or stepchildren under the age of 18 (or under age 19 if still enrolled in high school full-time) may qualify for up to half of the total amount of a parent’s retirement benefit.
Social Security survivor’s benefits can be paid to the closest surviving family members of a deceased worker which include widows and widowers and dependent children and dependent parents. According to the SSA, a widow(er) can collect reduced benefits as early as age 60, or wait until full retirement age (FRA). The SSA notes that a disabled surviving spouse is eligible for benefits as early as age 50. Benefits collected before FRA will be smaller “to take into account the longer period a person receives them.”
In general, the amount of benefits available are based on what the deceased would have been collecting at his/her FRA. Kiplinger notes that if the deceased spouse “had taken reduced benefits before full retirement age, the maximum you can receive will be based on his reduced benefits.”
Dependent biological, adopted or stepchildren who are under the age of 18 (or under age 19 if still enrolled in high school full-time) are also eligible for survivor’s benefits. Dependent parents aged 62 and older are also eligible if there is proof of caretaking of the parent.
Stay Informed to Maximize Benefits
There are multiple stipulations and limitations that married couples should understand, which are tied to factors and circumstances such as age and birth year, work history and earnings, and the children and parents of spouses. At New England Investment and Retirement Group, we recommend that both individuals and couples develop a thorough understanding of their unique situation in order to establish a plan that can offer protection for unexpected events, and communicate their unique situation with a trusted financial expert.