when someone passes away, their current or former spouse can often begin receiving Social Security benefits. Whether this happens depends on several different factors.
Who can receive spousal benefits?
Current and former spouses may receive spousal benefits. They must have been married for more than 10 years to qualify for this income. You must also be 62 years old to apply for or receive spousal benefits, but you can wait longer. If you wait until you reach full retirement age (up to 67 years old, depending on your birth date) to apply, you will receive a larger amount than if you applied earlier.
How much do you receive?
There are different types of Social Security benefits that you can claim. You can take Social Security income based on your work history and your own earnings, or you can collect spousal benefits instead.
If you take benefits based on your spouse’s work history and earnings, you will receive 50% of your spouse’s Social Security benefit amount. This amount is calculated at your spouse’s full retirement age (FRA). FRA is based on your birth date. You can check the Social Security website to see what age you or your spouse need to be to reach FRA.
Social Security calculates and pays the higher amount.
If you were born on or before January 1, 1954, once you reach your FRA, you can choose to receive only spousal benefits. You can apply for this by submitting what is known as a “restricted application.”
This allows you to defer receiving your own retirement benefits. Your benefit will continue to grow until you apply later on. If you were born at any time after January 1, 1954, you no longer have that option.
How does early retirement affect benefits?
Social Security is based on your earnings throughout your life. Anyone who retires early will lose a portion of their own benefit.
If you start receiving spousal benefits before you reach your FRA, your benefit will be permanently reduced. This is true unless you are caring for an eligible child. Depending on how early you are in retirement, this income may be reduced by up to 35%.
You can find out the exact amount by entering different ages into the Social Security Administration’s website. The site will show you what you can receive at different ages and how your income will change after retiring if you work longer.
Your spousal benefits will not be reduced if you are taking care of a child who is under 16 years old or receiving disability benefits from Social Security.
If you and/or your spouse wish to take Social Security benefits early, you will need to consider the long-term effects before doing so. Early benefits will reduce the income that can be paid over your lifetime.
It will also reduce the benefit that the surviving spouse can receive after one of them passes away. Married couples should plan how and when to start benefiting from their benefits.
You can run these numbers yourself to see how it works by using an online Social Security calculator. You can also talk to a financial advisor for advice on how to plan your benefits.
What happens if one spouse dies?
If your spouse dies, you can receive survivor benefits starting at age 60. You will be able to receive the maximum benefit, or the full monthly payment amount of Social Security for your spouse if you reach FRA.
Before that, it is reduced by 71.5% -99%. The percentage that is reduced depends on how many years above 60 you are.
If
You are the surviving spouse; you can restrict your request to apply for survivor benefits or your own benefit. Later, you can switch to the other amount.
You might do this if your monthly payment at age 70 will be larger than your spouse’s payment. You can claim the spouse benefit for several years and then switch to your own benefit at age 70.
If you are divorced and your ex-spouse has passed away, you may be able to receive the same benefits that any current spouse receives. This is true if your marriage lasted at least 10 years or you were caring for an eligible child.
Once you and your spouse start receiving Social Security benefits, the surviving spouse will need to choose one benefit. You can select your spouse’s monthly payment or your own. You cannot receive both.
If you were living in the same household at the time of your spouse’s death, you will also be able to receive a one-time payment of $255.
How much will your ex-spouse receive?
If you did not apply for retirement benefits but could qualify for them, your ex-spouse may receive benefits on your record if you have been divorced for at least two consecutive years.
If your ex-spouse is eligible for retirement benefits on their own record, we will pay that amount first. If the benefit on your record is higher, they will receive an additional amount on your record so that the total benefits equal the higher amount.
Conclusion
Workers who delay receiving Social Security until age 70 receive a higher monthly payment. When married couples choose to postpone the benefit of the higher earner, it acts as a form of life insurance. In many cases, it can provide $50,000 to $250,000 of life insurance. Married couples should plan how to maximize the benefits of the spouse and survivor.
Frequently Asked Questions (FAQs)
What is the maximum Social Security benefit you can receive?
It depends on when you retire, but if you retire in 2022 at full retirement age and qualify for the full amount, your benefit will be $3,345 per month. If you wait until age 70, you will receive $4,194 per month.
How long does my spouse need to work for me to receive spousal benefits from Social Security?
Your spouse needs to have at least 10 years of work, or 40 credits, to qualify for any Social Security benefits or for you to qualify for them. The years of work do not have to be consecutive, and up to four credits can be earned in a year. Your spouse must earn a specific amount to qualify for one credit, and this amount changes each year. In 2022, any person eligible for benefits must earn $1,510 to receive one credit. To earn the full four credits in a year, a worker must earn $6,040.
Source: https://www.thebalancemoney.com/how-the-the-social-security-spouse-benefit-works-2388924
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