Social Security Spousal Benefits for Divorced Couples

Presented by Ben Murphy, CPA, PFS™, CPFA® :

If you are divorced, you may be eligible to claim a “spousal” social security benefit based on your former spouse’s earnings record, providing you with more options to maximize your retirement benefit.

Criteria for Spousal Benefit After Divorce

To collect a spousal benefit based on your living former spouse’s earnings record, you generally must meet the following criteria:

You are not remarried.
You are at least 62 years of age.
Your marriage lasted at least 10 years.
Your own social security benefit based on your earnings record is less than the spousal benefit of your living former spouse.

If you’ve been divorced for at least two years and your former spouse is at least age 62, you can file for this benefit regardless of whether your living former spouse has already filed for benefits or has remarried.

If your former spouse is deceased, the requirements are slightly different. If you remarried—but the marriage took place after you reached age 60 (age 50 if disabled)—you may be eligible for survivor benefits on the deceased former spouse’s earnings record.

In addition, if you have more than one former spouse, you may be able to combine different strategies. Let’s look at an example.

Fact Summary

Jane, age 66, was married to Joe for 11 years and to Mike for 12 years.
Jane has been divorced from both at least two years.
Jane was born prior to December 31, 1953. As such, she falls under the category of people still able to file a restricted application.
Jane’s full retirement age (FRA) for social security is 66.

Joe is the higher earner of her former spouses, with a full monthly retirement benefit of $2,100.
Mike’s full monthly retirement benefit is $2,000.
Jane’s own full monthly retirement benefit (based on her own earnings record) is $900.

3 Spousal Benefit Strategies After Divorce

Strategy 1. At her FRA, Jane filed a restricted social security application, which means that when Jane first retired, she began collecting $1,050 in monthly spousal benefits based on Joe’s higher earnings record. This $1,050 represents the 50 percent spousal benefit available from Joe’s full retirement benefit of $2,100.

Strategy 2. Further, by delaying the collection of social security benefits based on her own earnings record, Jane’s account will continue to grow 8 percent per year until age 70 (due to delayed retirement credits). When she reaches age 70, she plans to switch to her own benefits based on her earnings record. Her worker benefit will have grown to $1,188 per month and will be higher than her spousal benefit of $1,050 per month.

Strategy 3. Before Jane reaches age 70, however, her other former spouse, Mike, passes away. Mike had delayed collecting his own social security benefits, and, as a result, his benefit at age 70 is now $2,640 per month. Jane is eligible to collect a survivor benefit of $2,640 per month. This survivor benefit represents 100 percent of Mike’s monthly benefit.

Keep in mind that, if you are divorced, you may be able to switch back and forth between your own benefits and those based on your former spouse’s work record. The rules are complex and require a critical assessment of your financial situation. If you need help deciding on the optimal strategy for claiming retirement benefits, don’t hesitate to contact us.

This material has been provided for general informational purposes only and does not constitute either tax or legal advice. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a tax preparer, professional tax advisor, or lawyer.

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Ben Murphy is a financial advisor located at Global Wealth Advisors 601 N. Marienfeld, Suite 322, Midland, TX 79701. He offers securities and advisory services as an Investment Adviser Representative of Commonwealth Financial Network^®, Member FINRA / SIPC, a Registered Investment Adviser. Financial planning services offered through Global Wealth Advisors are separate and unrelated to Commonwealth. He can be reached at (325) 207-5772 or at info@gwadvisors.net.