Marriage not only binds two individuals emotionally but also ties their financial futures together, especially when it comes to retirement planning.
Social Security spousal benefits play a crucial role in maximizing retirement income, ensuring that spouses, whether they worked or not, can receive financial support during their golden years.
Here’s a comprehensive guide to understanding Social Security spousal benefits and how they work.
What is Social Security?
Social Security is a massive social insurance program designed to replace a portion of lost earnings for individuals who retire, become disabled, or pass away.
Funded by payroll taxes, the program is a cornerstone of retirement income for millions of Americans. In 2024 alone, over 71 million Americans will receive Social Security benefits, amounting to more than $1 trillion.
Spousal Benefits: The Basics
If you’re married, you may be eligible to collect spousal benefits from your partner’s Social Security, even if you have not earned enough credits to qualify for your own benefits. To qualify, you must meet one of the following criteria:
- Be 62 years old or older.
- Be caring for a child under 16 or a disabled child eligible for benefits.
Spousal benefits provide a safety net for those who did not work or did not earn enough to qualify for substantial benefits on their own. If you qualify for both your own retirement benefits and spousal benefits, Social Security will pay your own benefits first.
If your spousal benefits are higher, you’ll receive an additional amount to bring your total to 50% of your spouse’s full retirement age benefit.
Dual Entitlement: Understanding the Math
In cases where the lower-earning spouse qualifies for both their own benefits and spousal benefits, a formula determines the additional spousal payment:Half of higher earner’s full retirement age benefit−Lower earner’s full retirement age benefit=Additional spousal payment\text{Half of higher earner’s full retirement age benefit} – \text{Lower earner’s full retirement age benefit} = \text{Additional spousal payment}Half of higher earner’s full retirement age benefit−Lower earner’s full retirement age benefit=Additional spousal payment
This formula ensures that the lower-earning spouse’s total benefits equal up to half of their partner’s full benefit amount.
When to Claim Spousal Benefits
The timing of your claim significantly impacts the amount you’ll receive. If you wait until full retirement age (66 or 67), you’ll receive 50% of your spouse’s benefit. However, if you claim as early as age 62, your benefits are reduced to 32.5% of your spouse’s benefit.
It’s essential to strategize when to claim, as early claiming reduces your monthly payout. However, these payments will never reduce your spouse’s benefits.
The Maximum Family Benefit
There’s a limit to the total amount of benefits a family can receive, called the maximum family benefit. Typically, this amount is 150% to 180% of the higher-earning spouse’s full retirement benefit.
This cap affects how much a family can draw from the system but does not affect benefits claimed by ex-spouses.
How Ex-Spouses Can Claim Spousal Benefits
Even after a divorce, your ex-spouse may still qualify for Social Security spousal benefits based on your work history. The conditions are:
- The marriage lasted 10 years or more.
- Your ex-spouse is 62 years or older and is unmarried.
- The benefits your ex-spouse is eligible for based on their own work are less than the spousal benefits they could claim from your earnings.
Importantly, your ex-spouse claiming spousal benefits won’t impact the total benefits your current family receives, as these benefits are not counted toward the maximum family benefit.
Spousal Benefits for Widows and Widowers
Surviving spouses are eligible for 100% of the deceased spouse’s benefit if they’ve reached full retirement age. If they claim between ages 60 and full retirement age, their benefit is reduced to 71.5% to 99% of the deceased spouse’s benefit.
For surviving spouses with disabilities, benefits can start as early as age 50. Even younger widows and widowers may receive benefits, depending on the deceased spouse’s work credits.
For instance, the younger a worker, the fewer credits they need to qualify their family for survivor benefits.
If you’re already receiving spousal benefits when your spouse passes away, those benefits convert to survivor benefits, which are typically higher.
Special Considerations for Same-Sex Couples
The Social Security Administration recognizes same-sex marriages in all states, which means same-sex couples are eligible for spousal benefits.
Some nonmarital relationships, like domestic partnerships or civil unions, are also recognized, allowing these individuals to access benefits under certain circumstances.
Impact of Other Benefits on Spousal Benefits
If you receive a government pension for work where you didn’t pay Social Security taxes, your spousal benefits could be reduced.
The Government Pension Offset reduces spousal benefits by two-thirds of your pension amount, which can significantly affect your total benefit.
Should You Wait to Claim?
Timing your claim for Social Security spousal benefits can make a big difference in your financial security during retirement. Waiting until full retirement age ensures you get the maximum benefit, while claiming early could leave you with reduced monthly payments.
Carefully considering other sources of income, your family’s financial situation, and potential longevity can help you make the best decision.
FAQs
Can I collect Social Security benefits from my spouse if I’ve never worked?
Yes, as long as you meet certain age or caregiving requirements.
How much of my spouse’s Social Security can I receive?
You can receive up to 50% of your spouse’s full benefit if you claim at full retirement age.
Can my ex-spouse claim part of my Social Security?
Yes, if your marriage lasted at least 10 years and they meet other eligibility requirements.
How does remarrying affect Social Security spousal benefits?
If you remarry, you generally lose eligibility for spousal benefits unless your subsequent marriage ends.
Do same-sex couples qualify for Social Security spousal benefits?
Yes, same-sex marriages are fully recognized for Social Security benefits.
