Much discussion revolves around regulations and tactics. claiming Social Security To fully utilize all the advantages offered by the program. However, one aspect of the program that could potentially be overlooked is spousal benefits .
Spousal benefits can be a lifeline for seniors who established a single-income household. Spouses who shortened their careers and stayed home to raise kids and manage a household can still receive a nice-sized monthly check thanks to spousal benefits.
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However, the guidelines for spousal benefits differ somewhat from those for individual retirement benefits. Therefore, it’s crucial to understand these specifics to make an informed choice when filing for spousal benefits. Below are three key points you should be aware of prior to applying for them.
1. How asserting your claim age affects your benefits
Similar to how timing affects personal retirement benefit claims from Social Security, the age at which you apply for spousal benefits can significantly influence the amount of your monthly payment.
Initially, it's crucial to recognize that the highest possible spousal benefit amounts to 50% of your spouse's. primary insurance amount That's what your spouse would get if they decide to claim it. full retirement age .
Similar to individual retirement benefits, you can qualify for spousal benefits starting at age 62. However, applying before reaching your full retirement age decreases your monthly payout. Moreover, the decrease in spousal benefits due to early claims is more significant compared to reductions seen with personal retirement benefits. Furthermore, different from what happens with individual retirement benefits, delaying the application beyond your full retirement age does not result in an increased spousal benefit.
Below is a chart illustrating the percentage of spousal benefits received compared to the partner’s primary insurance amount for individuals reaching full retirement age at 67 (those born from 1960 onwards) when they claim Social Security benefits at various ages.
| Claiming Age | Percentage of Spouse's PIA |
|---|---|
| 62 | 32.5% |
| 63 | 35% |
| 64 | 37.5% |
| 65 | 41.7% |
| 66 | 45.8% |
| 67 | 50% |
Source of data: Social Security Administration.
2. The effect of your spouse's claim approach on your spousal benefits
A crucial aspect of spousal benefits is that your spouse needs to enroll in them as well for you to qualify. Previously, one could file for benefits and subsequently halt the process. However, under current rules set by the Social Security Administration, typically an individual must start receiving benefits themselves if another person claims benefits using their earning history.
This scenario can pose difficulties for certain partnerships. Should the higher-earner delay claiming benefits to increase their payout amount, this might result in the lower-earning partner receiving significantly reduced benefits or no benefits whatsoever during the interim period. (Remember, you have the option to file for individual retirement benefits first and later convert to spousal benefits once your spouse has applied for Social Security.)
It frequently makes sense for the higher-earner among spouses to delay taking Social Security benefits until they reach 70 years of age so as to boost their surviving partner’s benefit later on. Nonetheless, this approach may not apply when the lower-income earner is considerably older or in poorer health. Every scenario varies; hence, it's crucial to evaluate how each individual's decision regarding when to claim benefits could affect the overall family income.
3. You are eligible for spousal benefits even after getting divorced.
Spousal benefit eligibility also applies to former spouses after a divorce. Provided that your marriage lasted a minimum of ten years, you have remained unmarried for at least two years since the divorce, and you do not get remarried—or any subsequent marriages conclude with an annulment, divorce, or passing—you can claim benefits through your previous spouse’s record.
Different from spousal benefits for those who are still married, divorced partners aren’t required to wait until their former spouse begins receiving benefits before they can collect spousal benefits themselves. Furthermore, applying for these benefits based on your ex’s work record won’t affect what he or she receives. In fact, the person you’re divorced from will remain unaware of your application altogether.
Likewise, you have the option to gather survivor benefits according to your former spouse’s record provided that you fulfill the ten-year stipulation. Under these circumstances, you could remain eligible for survivor benefits even if you get remarried, granted that your new marriage takes place when you're over 60 years old.
It's crucial to take those alternatives into account since they could hold greater value than any possible advantage linked to your individual earning history.
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