Social Security and Benefits for Your Spouse
Have you found that person you want to cheer up when sad and carry around when their arthritis is bad? The one you'll miss, kiss, and give your coat to when they're cold?
It probably sounds cheesy stated this way, but I know we all swooned when 1998 Adam Sandler sang "Grow Old with You" on the plane, for Drew Barrymore.
Without the romantic pretext of "The Wedding Singer," you'd probably cringe at the lyrics, but isn't it what love is about? The small things and the little compromises you're willing to make for someone, like letting them hold the remote control.
Growing old and the in-betweens are better when you go through it with someone. Retirement is even more exciting when you have a significant other to spend the rest of your days with.
With that in mind, it's important to ensure that both you and your spouse's retirement strategies are on track with how you imagine your life would be upon retirement. You have a lot of investment options, but I suggest that you start looking at your social security, particularly your spousal benefits.
You know you’re eligible for Social Security benefits, but did you know that there's also a provision to provide for spouses, regardless of whether they've contributed to the program? You might also be eligible to claim spousal benefits if you're widowed and, in some cases, even if you're divorced.
You may be surprised to learn that if you apply for Social Security when you are married, you automatically apply for spousal benefits. This was added to recognize the many spouses who were stay-at-home parents and either never entered the workforce or didn't enter the workforce for long enough to qualify for benefits of their own.
Couples, newly-weds, and not-so newly-weds read on and take some notes!
For spouses to receive benefits, they must either be at least 62-years-old or older, or caring for a child 16-years-old or younger, or for a child receiving Social Security disability benefits.
- Your husband or wife must have also claimed Social Security benefits.
- You and your spouse must have been married for at least one year.
You can claim spousal benefits for as much as half of the benefits your spouse would have received at their full retirement age. You can check your spousal benefit estimates, based on your spouse’s earning history, by creating and logging into your my Social Security account.
If you claim your spousal benefits at 62 years old or at any age prior to your FRA, your benefits will be reduced. Moreover, if your spouse claims their benefits before retirement age, your benefits will also be reduced.
However, this reduction does not apply to a spouse caring for a qualifying child. In fact, you can claim at any age, even before reaching 62, if the latter case applies to you.
The amount that will be reduced will depend on how far you are from your FRA when you filed your claim. You can easily compute the effect of early retirement on your benefits here.
If you are also eligible for a retirement benefit based on your own earnings, the amount you’ll receive is a combination of both your own benefits and your spousal benefits, capped at the amount of the higher benefit. For example, if you are entitled to $800 on your own retirement benefits and eligible for $1,200 on spousal benefits, you will receive $800 and an additional $400 from your spousal benefits.
If you claim either your own retirement benefits or your spousal benefits, you are deemed to have filed for the other claim as well (Deemed Filing Rule). This means that the “file and suspend” strategy is no longer applicable.
There are also certain conditions where you can receive spousal benefits even if you're divorced. The following conditions must be met:
- You and your ex-spouse must have been married for at least 10 years.
- You must be divorced from your ex-spouse for at least two consecutive years.
- You must be currently unmarried.
- Your ex-spouse must be entitled to Social Security retirement or disability benefits.
- The benefits you would have received from your work record must be less than the spousal benefits.3,4
It's important to note that if your spouse dies, you should apply for survivor benefits and not spousal benefits. For people who are widowed, if your spouse's benefits are higher than yours, you might be eligible to receive their full benefit amount instead of spousal benefits. However, if you remarry, you won't be eligible to receive your late spouse's Social Security benefits.
Retirement is not a destination you’ll be going into alone. Imagine RVing across the state or traveling abroad without anyone to share the adventure with, not fun eh? If you are married or have a partner to share your life with, remember that you are not just planning for yourself but for the both of you. Let us help you map out your future for that happy ever after!
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The information provided is for educational and informational purposes only and does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor's particular investment objectives, strategies, tax status or investment horizon. You should consult your financial advisor, attorney, or tax advisor. For additional information and disclosures, please visit our website at mbewealth.com. MBE Wealth Management, LLC is a registered investment advisor.
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