It is important to know the rules when it comes to claiming Social Security because there may be claiming strategies available to you that you’ve not heard of. For instance, did you know that Social Security benefits can be paid to divorcees based off an ex-spouse’s work record? Yes- it’s true! And though this is an important subject for all divorcees to understand, it is particularly important if you are female.
According to a Social Security report, almost half of the elderly female population receiving Social Security benefits relies on their benefit as 90% or more of their income.4
What’s more is that in 2015 the average female Social Security benefit was $14,184 vs. $18,000 for men.4 That’s a 21% difference. Why? Because their earnings history is, on average, smaller than males’. It might come as a surprise to learn that Social Security benefits are based on the average of your highest 35 years of earnings. For families with a stay-at-home parent, or part-time worker, it was often the female playing this role. But that’s not the only reason why females typically have much lower benefits, I’ve also seen it as a result of one spouse working in a high paying job so their spouse could work (or even volunteer) in a low paying job that fulfilled their passion. And even if none of these scenarios is true for you, perhaps your income was subjected to the gender wage gap. Regardless of your personal reasoning, it is important to know the rules of claiming Social Security so you can use them best to your advantage.
When it comes to claiming Divorced Spousal Social Security benefits, the main factor in determining if you qualify for benefits using your ex-spouse’s record is the length of your marriage.
To qualify for divorced spousal benefits you would have to have been married to each other for at least 10 years. Now that’s not the only stipulation, you also cannot be re-married and you need to have been divorced from each other for at least two continuous years. Your age and the age of your ex is also important. You can only claim on your ex-spouse’s income if both of you are at least 62 years old at the time.
Knowing this might tempt you to start taking benefits immediately at age 62, but just because you might be able to claim benefits that early does not mean it is best for you. If you start receiving benefits at age 62 you will only be able to collect 35% of your ex-spouse’s benefit. But, if you wait until your Full Retirement Age (don’t know your Full Retirement Age? It’s a little different for everyone, so check here) you can receive 50% of your ex-spouse’s full retirement benefit.2 Remember, this is in lieu of whatever your own benefit would be so it’s an either/or situation. I suggest you look at your own benefit and compare it to the benefit you would get from your ex and see how they compare over the years. Feel free to use this chart to help you2:
As you can see, there is an incentive for you to wait to collect benefits later than age 62. If you collect on your own earnings record you can receive as much as 132% of your Full Retirement Benefit (listed here as your PIA, or Primary Insurance Amount) if you wait to age 70. If you claim benefits on your ex-spouse’s record you will only ever be able to get up to 50% of their benefit but you max out that benefit earlier, at age 65.
Now that you know the basics, you might have some specific questions. See below for some FAQs
What if my ex is significantly younger than I am?
If your ex-spouse is younger than you, you can collect your own benefit when you become eligible to do so and then switch to collecting on theirs once they become eligible.5
What if my spouse remarried?
That’s not an issue, the important part is whether or not YOU are remarried.1 In fact, both you and your ex’s current spouse (if they meet the requirements) are able to claim benefits using your ex’s earnings record at the same time, and neither of your benefits affects each other’s!
What if my income was higher than my ex’s?
Assuming they meet all the other qualifying criteria, then they are able to collect benefits based off of YOUR earnings record. Don’t worry, this has absolutely no effect on the benefit you will receive.
I don’t want to deal with my ex, can I do this without dealing with them?
Absolutely, this can be done completely without your ex ever knowing as it will not affect their benefit in any way.
What if my ex isn’t claiming benefits yet?
They do not need to have claimed their benefits yet, nor applied for them. Just as long as they are at least 62 years old you can receive benefits on their record.2
What if I want to continue to work while I claim my Divorced Spousal Social Security benefits?
Depending on your age, if you continue to work while receiving benefits there is a maximum level of income you can earn before an additional tax is implemented on your earnings making it less worthwhile to claim and work at the same time. Check here https://www.ssa.gov/planners/retire/whileworking.html to see what your income limit might be, if there is one.
What if my ex is now deceased? Can I still claim benefits on their earnings record?
If your marriage was at least 10 years in length then you can collect benefits the same as a widow/widower would.
The percentage of your deceased ex-spouse's benefit amount you would receive depends on your age and life circumstances5:
- If you have reached your full retirement age or are older, you would receive 100% of their benefit.
- If you are 60 or older, but not yet of full retirement age, you would receive 71½% to 99%.
- If are 50 to 59 years old and disabled, you would receive 71½%.
- If you are caring for your ex-spouse's child who is disabled or under the age of 16, you would receive 75% regardless of your age.
Speaking of taxes, is my Social Security benefit taxable?
Yes. How much of your benefit is taxable depends on your total amount of income and benefits for the taxable year (including tax exempt interest).
50% of benefits are taxable:
- Individual: $25,000 to $34,000
- Married filing jointly: $32,000 to $44,000
85% of benefits are taxable:
- Individual: $34,000
- Married filing jointly: $44,000 3
It takes a lot of figuring and planning to decide how to best collect Social Security benefits, which might make it seem overwhelming and complicated. But it doesn’t have to be that way. Seek out a professional who understands the Social Security system well and have them help you. There is likely a cost to their services, but the cost of what you might miss out on is likely to be even greater.
1 Franklin, Mary Beth. “Length of Marriage Makes Big Difference in Social Security”. investment News. p. 21.8 April 2013.
2 Social Security Administration. www.ssa.gov . 1 April 2020.
3 Internal Revenue System. ww.IRS.gov. 1 April 2020.
4 www.AARP.org. “Women and Social Security Benefits.” Feb 2017.
5 www.TheBalance.com. “SocialSecurity Benefits for an Ex-Spouse.” 2 February 2020.