Widowed or Divorced? 6 Ways To Maximize Your Social Security Benefits
Written by
Josephine Nesbit
Edited by
Jenna Klaverweiden
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When you lose a spouse, whether that be through death or divorce, Social Security can replace much of the income you counted on. In fact, survivor benefits account for about 8.3% of all Social Security payments, per the Social Security Administration. And many don’t know that divorced spouses may also be entitled to benefits.
DeeDee Baze, financial planner, enrolled agent and managing partner at DeMar Consulting Group, frequently gives workshops on this very topic. If you’re widowed or divorced, here’s how you can maximize your Social Security benefits, according to Baze.
Know Which Check You Can Claim
Before you file for anything, Baze explained that it’s important to know which type of benefit to claim. “You can draw only one of the four benefits at a time, but there is a possibility you can switch later,” she said.
Here are the potential benefits for survivors and divorced former spouses, according to Baze and the SSA.
- Widow/widower: You may receive a survivor benefit based on your late spouse’s record. Benefits can start as early as age 60 (or 50 if disabled). If you wait until your survivor full retirement age (FRA), you can receive 100% of what your spouse was entitled to.
- Surviving divorced spouse: If your marriage lasted at least 10 years, you can receive the same survivor benefit as a widow or widower. Benefits may start as early as age 60 (or 50 if disabled), with the maximum rate equal to 100% at survivor FRA.
- Divorced spouse (ex is alive): You may be entitled to up to 50% of your ex-spouse’s FRA benefit. You can begin collecting as early as age 62, with the maximum of 50% available if you wait until your own FRA.
- Your own retirement: Your benefit is based on your own earnings record. You can claim as early as age 62. Waiting until the FRA allows you to receive 100%, and delaying beyond the FRA increases your benefit by 8% per year up to age 70.
The ‘Claim and Switch Later’ Strategy
“For many lower-earning partners, this is the single biggest money-maker,” Baze explained. “The result could be tens of thousands of extra dollars over a long retirement, without giving up income in the meantime.”
Baze recommended starting with the survivor benefit or divorced spouse benefit as early as you need it. In the meantime, let your own retirement benefit keep growing, as it earns 8% per year in delayed retirement credits up through age 70. Then, switch at 70 if your own check has become larger.
Watch Out for Early Filing Reductions
Be wary of early filing reductions. “These cuts are permanent, so run the numbers first,” Baze said.
Taking a survivor benefit at 60 locks in around 71.5% of the full amount, Baze explained, and the reduction shrinks each year you wait, disappearing at your survivor FRA. “An early claim on a living ex-spouse’s record is trimmed too, down to about 32.5% if you jump in at 62,” she said.
Take the Earnings Test
If you’re still working, take the earnings test. “Any dollars withheld could come back later as bigger benefit payments (they’ll recalculate your benefit at your full retirement age to include all the new money paid in), but the temporary cash-flow hit can sting if you’re not careful,” Baze said.
If you’re under FRA, keep your full check only if wages stay at or under $23,400. Earn more, and Social Security withholds $1 for every $2 above the limit. When you reach FRA, the limit jumps to $62,160 and drops to $1 for every $3.
Remarriage Timing Matters
If you plan to remarry, the SSA has rules that may impact your benefits.
According to Baze, survivor benefits generally stop if you remarry before age 60, or 50 if disabled. If you remarry at or after 60, you keep your right to the survivor check. Divorced spouse benefits end with any new marriage unless that marriage later ends or your new spouse is already collecting certain benefits.
Don’t Let Social Security Choose for You
“On the application, specify exactly which benefit you want: ‘survivor only,’ ‘spouse only,’ or ‘my own,'” Baze said. “If you don’t specify, the agency may automatically pay you the higher check and block future switches.”
That’s why it’s important to think through not just what looks best today, but how your choice could affect you years down the road.
“Also, the rules around Social Security are always changing, so make sure you watch for the most recent rule changes when you go to apply for a benefit,” she explained.
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