Retirement is a time to relax, but it also brings new challenges, especially for married couples. While marriage can bring joy, it also comes with its set of adjustments, like dealing with someone else’s dirty dishes and clothes lying around.
However, in retirement, there are some advantages to being married, such as companionship and sharing financial responsibilities.
A key benefit often misunderstood is the ability to collect spousal benefits from Social Security. Many people don’t fully understand how this works or how it can impact their retirement income. In this article, we will explore three key points about spousal benefits in Social Security that may surprise you.
1. Claiming Spousal Benefits Even If You Have Your Own Social Security
If you’ve worked and paid into Social Security during your career, you might expect to receive a benefit based on your own earnings. However, even if you’re entitled to Social Security benefits, you may still be eligible to receive spousal benefits.
Social Security will pay you the larger amount between your personal benefit and the spousal benefit.
But here’s the catch – you can’t collect both benefits at the same time. If your personal Social Security benefit is lower than the spousal benefit (especially if your spouse was the higher earner), then your spousal benefit will likely be more generous. In such cases, Social Security will pay you the larger spousal benefit without any issue.
2. No Extra Credit for Delaying Spousal Benefits After Full Retirement Age
When you file for Social Security based on your personal earnings record, you can earn a higher benefit by delaying your claim. If you wait past your full retirement age (which is 67 for those born in 1960 or later), your monthly benefit increases by 8% per year until you reach the age of 70. This can significantly boost your retirement income.
However, this delayed claim benefit doesn’t apply to spousal benefits. Once you reach full retirement age, the most you can collect in spousal benefits is 50% of what your spouse is entitled to from Social Security. There’s no additional financial benefit to waiting longer than your full retirement age to claim spousal benefits.
3. Divorcees Can Claim Spousal Benefits
If you’re divorced, you may think that spousal benefits are off the table. But that’s not the case. If you were married for at least 10 years, you may still be eligible to claim spousal benefits based on your ex-spouse’s Social Security record.
As long as you haven’t remarried, you can claim these benefits, and you don’t even have to wait for your ex-spouse to file for Social Security.
On the other hand, if you’re still married, you must wait for your spouse to file for Social Security before you can claim spousal benefits.
Social Security spousal benefits offer significant financial advantages for married and divorced individuals in retirement. By understanding how these benefits work, you can make better decisions about when to file for Social Security and how to maximize your retirement income.
Whether you’re still married or divorced, take the time to learn about spousal benefits so you can plan your retirement effectively.
