10 Top Social Security Questions for Divorced Spouses
By Mary Beth Franklin
The phenomenon of gray divorce — the term for married couples who decide to split up in later life — has become a fixture of American culture and a challenge for the financial planning profession. The best-laid retirement plans for married couples seldom fare as well when divided in half. Consequently, knowing how Social Security rules apply to divorced spouses takes on increasing importance in an era when 25% of divorcing Americans are age 50 or older. Here are some of the top questions that I have received from financial advisers on the subject of Social Security benefits for divorced spouses.
Collecting on an ex’s record
Are all divorced spouses entitled to Social Security benefits on their ex’s earnings record?
No. In order to collect Social Security spousal benefits based on an ex’s earnings record, the couple must have been married at least 10 years and each must be at least 62 years old. You can collect Social Security benefits on your ex-spouse’s earnings record (even if the ex has remarried) as long as you are currently unmarried.
Spousal benefits after divorce
How much are divorced spousal benefits worth?
Just as if you were still married, your benefit as a divorced spouse is equal to half of your ex-spouse’s full retirement age amount if you start collecting benefits at your full retirement age or later. Reduced spousal benefits are available as early as age 62.
Restricted spousal benefit claims
Can a divorced woman, who is age 63 and single, file for half of her ex-husband’s Social Security benefits now while allowing her own retirement benefit to continue to grow?
No. If she wants to collect spousal benefits only and allow her own retirement benefit to continue to grow, she must wait until her full retirement age of 66 to restrict her claim to spousal benefits only. Her own retirement benefits would earn delayed retirement credits worth 8% per year for every year she postpones collecting them beyond her full retirement age up to age 70, boosting benefits by up to 32%.
What happens if a divorced spouse, who is dually entitled to Social Security benefits as a spouse and on her own earnings records, claims benefits before her full retirement age?
The Social Security Administration (SSA) will pay her own retirement benefit first, reduced for early claiming. If the spousal benefit amount is higher, SSA will pay a combination of both benefits that equals the higher amount, reduced for early claiming. Spousal benefits collected at 62 are worth just 35% of the worker’s primary insurance amount compared to 50% at age 66.
Filing independently for benefits
Can a divorced individual collect Social Security benefits on an ex-spouse’s earning record if the ex has not yet filed for retirement benefits?
Yes. As long both ex-spouses are at least 62 years old and they have been divorced at least two years, one ex-spouse can file for benefits on the other ex-spouse’s earnings record, even if the ex has not yet claimed benefits. (But benefits claimed before 66 are permanently reduced). This special arrangement to file independently for spousal benefits is available only to divorced couples.
Rules for remarriage
What happens if a divorced spouse, who is collecting Social Security benefits on her ex, remarries?
Generally, if you remarry, you cannot collect benefits on your former spouse’s record unless your later marriage ends by death, divorce or annulment. However, if you are collecting Social Security benefits on your ex and you marry someone who is also collecting Social Security benefits as a divorced spouse or surviving spouse, you both can continue to collect your respective benefits.
Survivor benefits after divorce
What happens if your ex-spouse dies?
You can claim a survivor benefit worth 100% of what your ex-spouse was receiving or was entitled to receive at time of death — even if he or she has remarried. Both the divorced surviving spouse and the surviving spouse are each eligible for benefits worth 100% of the deceased worker’s amount assuming each survivor is at least full retirement age. Reduced survivor benefits are available as early as age 60.
Remarriage, death and survivor benefits
Can divorced spouses who remarry collect survivor benefits if their ex-spouse dies?
Yes, as long as a divorced spouse waits until age 60 or later to remarry, he or she can collect survivor benefits on an ex-spouse who dies, assuming that amount is larger than their own retirement benefit or a spousal benefit on their current mate’s earnings record. You can collect only one Social Security benefit, but you are entitled to collect the largest one available to you.
Earnings cap restrictions
Are divorced spouse’s benefits subject to earnings cap restrictions?
Yes. If you receive any type of Social Security benefit before your full retirement age and you continue to work, your benefits are subject to earnings restrictions. In 2015, you forfeit $1 in benefits for every $2 earned above $15,720 if you are younger than 66 for the entire year. A more generous earning test applies in the year you turn 66 and disappears once you reach your full retirement age.
Can an ex-spouse who receives a pension from a public sector job collect a Social Security benefit on an ex-spouse who worked in the private sector?
If you receive a pension from work where you did not pay FICA taxes, any potential spousal or survivor benefits as a divorced spouse could be reduced by the Government Pension Offset provision. The GPO, which also affects public school teachers in some states, requires that any potential Social Security benefit first be reduced by two-thirds of the amount of your government pension. For example, if you receive a pension of $1,500 per month, your Social Security benefit would be reduced by $1,000 per month. So if your potential spousal benefit is $1,200 per month, you would receive only $200 per month from Social Security.
John R. Boyer may be reached at 813-254-9500 or firstname.lastname@example.org.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of John Boyer, Inc.
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