Social Security: Retirement Benefits For Your Spouse & Survivors

by | Sep 1, 2021 | Retirement, Social Security

Social Security retirement benefits have provisions that make payments available to your spouse and survivors.  Learn how these provisions work so you can maximize the benefits your spouse receives and protect your family if you should pass away early in life.

Recall from Part I – Your Retirement Benefit that Social Security retirement benefits are based primarily on work history and the age when benefits are started.  Tied to this are provisions that make retirement benefits available to your spouse and also to your survivors.

Spousal Retirement Benefit 

Spousal benefits refer to the provisions in Social Security that allow one spouse to collect a benefit based on the earnings history of their partner.  This is a hugely beneficial provision for spouses who have either not earned the required number of credits to collect a benefit on their own or who have a modest earnings history relative to their partner.

The Social Security Administration calculates the benefit of both spouses based on each of their own earnings histories.  If the benefit one spouse would collect based on their own earnings record is less than the amount they would collect based on their partner’s, they can receive the larger amount.

Spousal benefits can be as high as 50% of the amount that the higher-earning partner is eligible to receive at full retirement age (FRA), but it will never exceed this amount.  This assumes that the spouse applying for the spousal benefit begins collecting no sooner than their own FRA.  The age that the higher-earning spouse starts collecting their own benefit does not impact the spousal benefit amount.

 

Spousal Benefits Maximum Benefit Amount
The spouse who collects at their own FRA  50.0% of the spouse’s FRA benefit
The spouse who collects before their own FRA  32.5% – 49.0% of the spouse’s FRA benefit

The catch with spousal benefits is that they cannot be claimed until the primary spouse begins collecting their own retirement benefit.  Spousal benefits that are started by the lower-earning spouse before their own FRA are also reduced at an accelerated rate compared to the reduction that occurs when claiming a retirement benefit based on one’s own earnings history.  Additionally, spousal benefits do not increase if the lower-earning spouse delays collecting the benefit past their own FRA; therefore, it does not benefit to delay collecting spousal benefits past age 67.  If a spouse’s partner dies while they themselves are collecting a spousal benefit, the rules governing survivor benefits apply.

Retirement Benefits for Divorced Spouses

If you were married for at least 10 years and are unmarried when filing for Social Security retirement benefits, you may be eligible for spousal benefits based on your ex-spouse’s earnings history.  This is true regardless of whether your ex-spouse remarried or not.  If your ex-spouse is deceased, you are also eligible for divorced spouse survivor benefits. The rules that differ for divorced spouses compared to those who remain married to their partner is as follows:

  • The divorced spouse does not have to wait until the ex-spouse files for their own benefits to collect a spousal benefit
  • Remarrying while an ex-spouse is still alive terminates the divorced spouse’s claim to future spousal and survivor benefits
  • Remarrying after age 60 if your ex-spouse is deceased does not automatically terminate survivor benefits

Survivor Retirement Benefits for Spouses

Although a modest amount, The Social Security Administration will pay a one-time death benefit of $255 to a surviving spouse when their partner passes away.  More importantly, surviving spouses can collect a retirement benefit based on their own earnings history or they can collect a survivor benefit based on their deceased spouse’s earnings if it is greater than what they would receive on their own.  The survivor benefit can be as much as 100% of a deceased spouse’s retirement benefit.

Generally, surviving spouses have to wait until age 60 before they can start receiving survivor benefits, which is one reason that life insurance has a place in a family’s financial plan.  An exception to this is made if the surviving spouse is disabled.  When this is the case, benefits can be started as early as age 50.  Moreover, if the surviving spouse is caring for the children of the deceased spouse who are under age 16 or who are themselves disabled, the surviving spouse is immediately eligible to collect survivor benefits regardless of their own age.  They will also continue collecting benefits until the youngest child reaches age 16.  If the child they care for is mentally disabled, the benefits they receive can continue beyond the age of 16.

Survivor Benefit for Spouses Maximum Benefit Amount
Surviving spouse collects at their own FRA 100.0% of deceased spouse’s benefit 
Surviving spouse (at any age) who is caring for dependent children under age 16 75.0% of deceased spouse’s benefit; benefits will end when the last child turns age 16 
Surviving spouse (at any age) who is caring for a disabled child 75.0% of deceased spouse’s benefit; benefits can continue beyond age 16 if the surviving spouse exercises parental control for the mentally disabled child
Surviving spouse collects at age 60 71.5% to 99.0% of deceased spouse’s benefit 
Surviving spouse is disabled and collects between age 50 and 60 71.5% of deceased spouse’s benefit

 

The catch with survivor benefits, in general, is that they are based either on what the deceased spouse was already collecting at the time of their passing or what they would have collected at FRA if they did not start collecting benefits before their death.  If the deceased started collecting benefits early and was consequently receiving a reduced benefit as a result, then the survivor benefit amounts that their spouse and dependents will be eligible for will be based on that reduced amount.

Survivor Retirement Benefits for Children

Unmarried children (biological, adopted, and step) of the deceased who are under the age of 18 are eligible for their own survivor benefits.  Children of the deceased who are disabled can collect benefits beyond age 18 if they are disabled and their disability began before they reached age 22.  Survivor benefits for each child can be as high as 75% of the benefit amount of their deceased parent.

 

Survivor Benefit for Dependent Children Maximum Benefit Amount
Surviving child who is under age 18  75.0% of deceased parent’s benefit; benefits will end at age 18
Surviving child (at any age) who was disabled before age 22 75.0% of deceased parent’s benefit; benefits can continue beyond age 18

 

Survivor Retirement Benefits for Dependent Parents

Dependent parents (biological, adoptive, and step) of the deceased who are at least age 62 are also eligible for survivor benefits.  The dependent parents must have been receiving more than 50% of their financial support from their working child prior to his or her death.  If they were unmarried or widowed themselves prior to the death of their working child, they may forfeit eligibility to receive survivor benefits if they remarry.

Survivor Benefit for Dependent Parents Maximum Benefit Amount
A surviving parent who is age 62 or older  82.5% of deceased child’s benefit
Surviving parents who are both
age 62 or older
75.0% each of deceased child’s benefit

The total amount of survivor benefits a family can collect is limited to 180% of the full retirement age benefit amount of the deceased.  If the total amount of survivor benefits calculated for a family exceeds this limit, the individual benefit amounts to each family member are reduced proportionately.  Benefits paid to a surviving divorced spouse based on age or disability do not count towards this threshold.

Conclusion

Social Security spousal and survivor benefits are an integral part of financial planning.  They affect your income in retirement as well as the income your survivors will be eligible to receive should you pass away early in life.  If you want help navigating the complexities of these benefits, please contact us today. 

Chris Yeagle

Chris Yeagle

Principal & Financial Advisor - Honeygo Financial

Chris began his career as a financial advisor with Merrill Lynch where he developed retirement plans for hundreds of clients and helped those he served to simplify their strategies and manage their investments.  He is a graduate of the University of Baltimore’s Merrick School of Business and he holds a Master of Finance from Loyola University.  Chris and his family are life-long Marylanders, who enjoy traveling the country visiting new places and old friends.

Honeygo Financial is a registered investment advisory firm offering services in Maryland and in other jurisdictions where exempted.  All written content is for informational purposes only. Opinions expressed herein are solely those of the firm, unless otherwise specifically cited.  Material presented is believed to be from reliable sources and no representations are made as to its accuracy or completeness.  Tax strategies discussed herein should be reviewed by a tax professional.