Social Security Benefits – Spousal Or Survivor? – Which One?

When discussing Social Security filing strategies with clients, I often run across the confusion between a spousal benefit and a survivor benefit.

There is a difference as they are two totally separate benefits. When your spouse passes away, the ability to collect a spousal benefit or continue to receive a spousal benefit ends as your spouse is deceased. After this life event, you are eligible to begin collecting a survivor benefit.

This information applies to the current spouse only, not an ex-spouse.

The 3 most common Social Security benefits are:

1. Worker benefits – the worker benefit is your own benefit. The benefit you personally have earned over your lifetime of working.

2. Family benefits – these benefits are broken down into four categories:

1. Spousal benefits – these benefits are paid to a current spouse- as discussed above.
2. Children’s benefits – these benefits are paid to children under age 19 and still in high school.
3. Child in Care benefits – these benefits are paid to a spouse who has not reached the age of 62, with children under 16 in the household.
4. Ex-Spousal benefits – these benefits are paid to an ex-spouse whom you were married to for at least 10 years.

3. Survivor benefits – these benefits are paid to a surviving spouse when their spouse passes away.

SPOUSAL BENEFITS

The spousal benefit comes under the heading of a family benefit. A spousal benefit for a current spouse is available only if your current spouse is living and currently receiving their own worker benefit.

A spousal benefit is only available if it is greater than your own worker benefit. The maximum spousal benefit is equal to 50% of your spouse’s benefit at their full retirement age if you apply at your full retirement age.

For example, if your own worker benefit at full retirement age (67) is $1,500, and 50% of your spouse’s full retirement age (67) benefit is $1,000, you will be paid your own worker benefit only, as it is greater than 50% of your spouse’s full retirement age benefit. Conversely, if your own worker benefit at full retirement age (67) is $1,000, and 50% of your spouse’s full retirement age (67) benefit is $1,500, you will be paid your own worker benefit of $1,000 and an additional $500 of a spousal benefit at full retirement age. The key here is that you are always paid your own worker benefit first. If there is a spousal benefit, it is layered on top of your own worker benefit. If you apply for a spousal benefit before your full retirement age, your own worker benefit will be reduced, and the spousal benefit amount will also be reduced.

To qualify for spousal benefits:

• Married for at least 1 year continuously
• Other spouse must be receiving their Social Security benefit
• Both you and your spouse must be at least age 62
• The spousal benefit must be greater than your own worker benefit
• You must apply, the benefit will not begin automatically
• You can apply online

In addition, these other rules apply:

• Both spouses cannot receive spousal benefits at the same time
• The annual earnings limitation applies before your full retirement age
• If you have another government pension, the Windfall Elimination Provision and the Government Pension Offset will apply
• There is no advantage to be gained by deferring collection of this benefit past your full retirement age
• Family Maximum rules apply
• You can voluntarily suspend benefits at your full retirement age

SURVIVOR BENEFITS

Once your spouse passes away you are no longer eligible for a spousal benefit. Survivor benefits are separate from your own retirement benefit. This benefit is paid to a spouse, ex-spouse, and young children. You are now eligible for survivor benefits paid as follows:

• If your deceased spouse HAS NOT FILED for benefits and passed away BEFORE FULL RETIREMENT AGE, you are entitled to receive the deceased’s full retirement age benefit
• If your deceased spouse HAS NOT FILED for benefits and passed away AFTER FULL RETIREMENT AGE, you are entitled to receive the deceased’s benefit as if they filed on the date of death
• If your deceased spouse DID FILE for benefits BEFORE FULL RETIREMENT AGE, you are entitled to receive what your spouse was receiving or 82.5% of your deceased spouse’s full retirement age benefit
• If your deceased spouse DID FILE for benefits ON OR AFTER FULL RETIREMENT AGE, you are entitled to receive what the deceased was receiving at the date of death
• Adjusted for survivors filing age

To qualify for survivor benefits:

• Survivor needs to be at least 60 and not married, or 50 if disabled
• You need to be married at least 9 months except in the case of an accident
• An ex-spouse can collect a survivor benefit if married at least 10 years
• Eligible children under 16 can also receive a survivor benefit, worth up to 75% of the deceased’s benefit
• You cannot apply online

In addition, these other rules apply:

• Survivors must apply for the lump-sum death benefit of $255 within two years of the date of the spouse’s death. To report a death or apply for survivor’s benefits, call, or visit your local Social Security office
• Any time there is a survivor benefit involved; you should always consider taking one of the two benefits as soon as possible. You can choose to claim survivor benefit and switch to your own worker benefit later if advantageous, or vise-versa
• If you apply before your full retirement age the benefit will be reduced
• If you remarry before age 60, you cannot receive a survivor benefit
• If you remarry after age 60, you will still be eligible for the survivor benefit
• The annual earnings limitation also applies if you have not reached your full retirement age
• If you have another government pension, the Government Pension Offset (GPO) will apply, but not the Windfall Elimination Provision (WEP)
• There is NO advantage to waiting to start collecting survivor benefits after you reach full retirement age
• Return spouses retirement check to Social Security received in the month of death
• If you are receiving a spousal benefit, that benefit ends

I hope this helps describe the difference between these two Social Security benefits. Remember, take the wrong benefit at the wrong time, it’s always smaller and forever!