Social Security benefits for spouses are a common source of confusion. A recent survey found that nearly 30% of Americans nearing retirement are unaware that spouses can claim Social Security based on the work record of a partner. The same survey found that almost 50% of Americans nearing retirement are unaware that divorced spouses can still claim Social Security on the work record of their ex-partner.
Those knowledge gaps could be problematic, because Social Security is typically a major source of cash flow in retirement. Here are four things retired couples need to know about Social Security benefits for spouses.
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1. Spouses can claim Social Security on their partner’s work record
Social Security retirement benefits are available to retired workers and spouses, even for spouses with no work history. Specifically, spouses can claim Social Security based on the work record of a retired partner, provided the following conditions are satisfied.
- The spouse must be at least 62 years of age.
- The partner must be receiving retirement benefits.
Some spouses will be eligible for Social Security as both a retired worker and a spouse. When they claim Social Security, they will automatically be awarded the bigger payout.
2. Spouses can maximize their benefit by claiming at their full retirement age
Spousal Social Security benefits depend on the claiming age of the spouse and the primary insurance amount (PIA) of the retired worker on whose record they claim. The term PIA refers to the benefit a worker would receive if they claimed Social Security at their full retirement age.
The spousal benefit will equal one-half of the retired worker’s PIA if the spouse starts Social Security at their full retirement age. Spouses that claim before their full retirement age get a smaller payout, meaning they get less than 50% of the retired worker’s PIA. The reduction depends on how many months early benefits start. But it would be most severe at age 62, the earliest possible claiming age.
There is one point of possible confusion. Retired workers can earn delayed retirement credits that increase their benefit if they claim Social Security after their full retirement age. Spouses cannot earn delayed retirement credits, so there is no advantage to claiming spousal benefits later than full retirement age.
The chart below shows the spousal benefit (as a percentage of the retired worker’s PIA) for anyone born in 1960 or later, meaning their full retirement age is 67.
|
Age |
Spousal Social Security Benefit |
|---|---|
|
62 |
32.5% |
|
63 |
35% |
|
64 |
37.5% |
|
65 |
41.7% |
|
66 |
45.8% |
|
67 |
50% |
Data source: The Social Security Administration. Note: Percentages have been rounded to the nearest one-tenth of a percent.
3. Divorced spouses can still claim Social Security benefits
Divorced spouses can still collect Social Security benefits based on the work record of their ex-partner, provided the following conditions are satisfied.
- The divorced spouse is at least 62 years of age.
- The marriage lasted at least 10 years.
- The divorced spouse has not remarried.
There are three points of possible confusion. First, spouses typically cannot collect benefits on the work record of a partner unless that partner is also receiving retirement benefits. However, that rule does not apply to divorced spousal benefits.
Second, divorced spouses can still receive Social Security benefits (assuming the three conditions listed above are satisfied) even if their ex-partner remarries. It is only the claiming spouse’s marital status that determines eligibility.
Third, some divorced spouses mistakenly believe that claiming Social Security on the work record of their ex-partner will impact their ex-partner’s benefit. Other divorced spouse worry their ex-partner will know if they file for spousal benefits. Neither is true. The ex-partner’s payout will not change, nor will they be notified if the spouse claims Social Security on their work record.
4. Spouses cannot claim one retirement benefit and delay another
As mentioned, some spouses will be eligible for benefits as both a retired worker and a spouse. In that situation, spouses cannot claim one Social Security benefit and delay another. In particular, they cannot delay their retired-worker benefit to get a bigger payout, while simultaneously collecting spousal benefits based on the work record of their retired partner.
When spouses file for Social Security, they automatically file for retired-worker benefits and spousal benefits, and they will receive the larger of the two payments. However, that rule only applies to retirement benefits, not survivors benefits. A widow or widower could collect a survivor’s benefit while simultaneously delaying their retired-worker benefit to earn delayed retirement credits.
