Retiring After A Life Out Of The Work force
Your dad is about to retire at age 67, but your mom is 65 and she's never held a job. You’re now wondering if she, too, can collect Social Security benefits based on your dad’s work record, even though she never technically paid into the system herself. Social Security provides spousal benefits that help non-working spouses, but the exact rules are dependent on some key factors like age, timing, and how and when they each file for benefits.
How Social Security Spousal Benefits Work
If your mom is married to someone who qualifies for Social Security retirement benefits, she may be eligible for a spousal benefit based on your dad’s earnings record. This benefit is classified separately from any retirement benefit she might get based on her own work record. But since she never worked, her spousal benefit may be her primary Social Security income source.
Eligibility: Age Matters
To qualify for spousal benefits, your mom generally has to be at least age 62 and married to someone who is already receiving Social Security retirement or disability benefits. At age 65, she already meets that age requirement, but she also has the choice of when to start her benefits, which affects the amount she receives.
Full Retirement Age For Spousal Benefits
Full Retirement Age, often called FRA, is the age at which Social Security benefits reach their maximum value without any reduction. For your mom, full retirement age is between 66 and 67 depending on the exact birth year. Waiting until she reaches the full retirement age generally increases the monthly benefit amount she would get.
How Much Can A Nonworking Spouse Get?
A nonworking spouse may receive up to 50% of the working spouse’s full retirement benefit when she claims at full retirement age. That means if your dad’s benefit at his full retirement age is $2,000 per month, your mom could receive up to $1,000 per month as a spousal benefit once she reaches her own full retirement age.
Dustin Moore, Wikimedia Commons
What Happens If She Claims Early?
If your mom starts collecting spousal benefits before she’s reached her full retirement age, her benefits will be permanently reduced. For example, if she claimed at age 62, it could lower the spousal benefit to roughly 32.5% of your dad’s benefit instead of the full 50%. So you can see that the timing of retirement and making the claim has a meaningful impact on lifetime income.
Timing Of Your Dad’s Benefits
For your mom to claim a spousal benefit, your dad has to already be receiving his Social Security retirement benefits. Spousal benefits typically can’t start until the worker is actively collecting. If he delays claiming, her eligibility to collect a spousal benefit may also be affected.
Spousal Benefits Don’t Reduce His Check
It’s also important to note that your mom getting spousal benefits doesn’t reduce the amount your dad receives. Social Security pays spousal benefits separately. His monthly benefit stays the same whether or not she files for a spousal benefit.
How Deemed Filing Affects Claiming
Under current Social Security rules, when someone files and is eligible for both their own retirement benefit and a spousal benefit, they are then considered to have filed for both. The Social Security Administration sensibly pays the higher of those two amounts, rather than combining them.
Yoshi Canopus, Wikimedia Commons
What If She Has Her Own Social Security Work Credits?
Even if your mom never worked much, if she has earned at least 40 credits through all of her past employment, she could qualify for her retirement benefits of her own. In that case, she would get either her own benefit or the spousal benefit, whichever amount is higher, but, again, not both added together.
Survivor Benefits
If your dad passes away first, your mom could qualify for survivor benefits. Survivor benefits can be as much as 100% of your dad’s benefit amount, depending on her age at the time she started collecting. These benefits go by different rules than standard spousal benefits.
Marriage Duration And Eligible Benefits
In most cases, your parents have to have been married for at least a year before your mom can start collecting spousal benefits. Since your dad worked his whole life and the two of them have been married long-term, the two of them more than likely meet the duration requirement for eligibility.
What Happens If The Couple Divorces?
If your parents were divorced after being married for at least 10 years, your mom could still claim spousal benefits based on your dad’s record, provided that she’s still unmarried and meets the age requirements. Divorce doesn’t necessarily eliminate access to spousal Social Security benefits.
How Benefits Are Calculated
Social Security calculates the spousal benefit based on your dad’s Primary Insurance Amount. This is the benefit he would receive at his full retirement age. The maximum spousal benefit is capped at 50% of that full retirement age amount, not 50% of a delayed benefit (which would apply if your dad had continued working past his full retirement age).
Delaying Benefits Can Increase Amounts
Your dad can increase his own benefit by delaying retirement up to age 70, thereby earning delayed retirement credits. However, your mom’s spousal benefit does not increase beyond the 50% of his full retirement age benefit. Delaying generally only benefits the worker’s own check and future survivor benefit.
How Do Earnings Affect Early Claims?
If your mom chooses to claim benefits before she’s reached full retirement age, or let’s say, she gets a job and starts working, her benefits may be temporarily reduced if her income exceeds the Social Security earnings limit. Once she reaches full retirement age, the earnings limit no longer applies.
Does Spousal Benefit Impact Other Benefits?
Your mom getting a spousal benefit doesn’t lower your dad’s benefit and doesn’t reduce potential survivor benefits. Spousal benefits are just an added layer of support built into the Social Security system specifically to protect nonworking or lower-earning spouses.
Strategies To Maximize Household Benefits
Many couples coordinate their claiming ages so they can maximize total household Social Security income. While the details are complicated, the basic rule of thumb is that waiting until full retirement age or later can result in higher combined lifetime benefits, especially in your parents’ case where one spouse has little or no individual work history.
Applying For Social Security Spousal Benefits
Your mom can apply for spousal benefits through the Social Security Administration online, by phone, or in person. Creating a My Social Security account can help both of your parents estimate their potential benefit amounts and compare different claiming strategies before they go to make any final decisions.
Social Security Is Just Part Of Retirement
Spousal benefits are an important source of support for nonworking spouses, but they’re only one component of retirement planning. Combining Social Security with savings, pensions, and other investments allows greater financial stability during retirement years.
Planning Ahead Makes All The Difference
Because Social Security rules are complex and the timing of benefits affects your remaining lifetime payout, planning ahead of time can make a major financial difference. Reviewing options carefully or consulting a financial professional can help your parents maximize their benefits.
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