Social Security is a government program that provides financial support to retired and disabled individuals, as well as their families. While most people are familiar with the retirement benefits offered by Social Security, many are unaware of the spousal benefits that are also available. In this article, we will explore what spousal benefits social security are, how they work, and who is eligible to receive them.
What are Spousal Benefits Social Security?
Spousal benefits social security are a type of benefit that is available to the spouse of a retired or disabled worker who is receiving Social Security benefits. These benefits are designed to provide financial support to the spouse who may not have their own work history or may have a lower income than their partner.
Spousal benefits are based on the earnings of the working spouse and are paid out as a percentage of their Social Security benefit. This means that the higher the working spouse’s benefit, the higher the spousal benefit will be. The maximum spousal benefit is 50% of the working spouse’s benefit.
It is important to note that spousal benefits are only available to married couples. This includes both opposite-sex and same-sex marriages, as long as the marriage is recognized by the Social Security Administration (SSA).Read:Is a pension a defined benefit plan?
How Do Spousal Benefits Work?
In order to receive spousal benefits, the working spouse must be receiving their own Social Security benefits. The spouse who is applying for spousal benefits must also be at least 62 years old and must have been married to the working spouse for at least one year.
Once the working spouse begins receiving their Social Security benefits, the non-working spouse can apply for spousal benefits. The amount of the spousal benefit will be calculated based on the working spouse’s full retirement age benefit, even if they are receiving reduced benefits due to early retirement.
If the non-working spouse is also eligible for their own Social Security benefits, they will receive the higher of the two benefits. For example, if the non-working spouse is eligible for a benefit of $500 and the spousal benefit is $600, they will receive the spousal benefit of $600.
It is also important to note that spousal benefits do not increase after the working spouse reaches their full retirement age. This is different from individual Social Security benefits, which can increase if the individual delays claiming benefits past their full retirement age.
Who is Eligible for Spousal Benefits?
In order to be eligible for spousal benefits, the non-working spouse must meet certain criteria. This includes being at least 62 years old, being married to the working spouse for at least one year, and not being eligible for a higher benefit based on their own work history.Read:What documents are needed for social security retirement benefits?
Additionally, the working spouse must be receiving their own Social Security benefits in order for the non-working spouse to receive spousal benefits. If the working spouse has not yet claimed their benefits, the non-working spouse will not be eligible for spousal benefits.
It is also important to note that if the non-working spouse remarries, they will no longer be eligible for spousal benefits. However, if the subsequent marriage ends, they may be able to resume receiving spousal benefits from their previous spouse.
Examples of Spousal Benefits Social Security
Let’s take a look at a couple of examples to better understand how spousal benefits social security work.
Example 1: John and Mary have been married for 20 years. John has worked for most of his life and is now receiving Social Security benefits of $2,000 per month. Mary has never worked outside the home and is now 62 years old. She is eligible for a spousal benefit of $1,000 per month, which is 50% of John’s benefit.
Example 2: Sarah and Emily have been married for 10 years. Sarah has worked for most of her life and is now receiving Social Security benefits of $1,500 per month. Emily has never worked outside the home and is now 62 years old. However, Emily is also eligible for her own Social Security benefit of $1,000 per month. In this case, Emily will receive her own benefit of $1,000 per month, as it is higher than the spousal benefit she would receive from Sarah.Read:How to be friends with benefits?
Case Study: The Impact of Spousal Benefits on Retirement Planning
Spousal benefits can have a significant impact on retirement planning for married couples. Let’s take a look at a case study to see how spousal benefits can affect a couple’s retirement income.
Case Study: John and Mary are both 62 years old and are planning for retirement. John has worked for most of his life and is eligible for a Social Security benefit of $2,000 per month at his full retirement age of 66. Mary has never worked outside the home and is also eligible for a spousal benefit of $1,000 per month at her full retirement age of 66.
If John and Mary both claim their benefits at age 62, John’s benefit will be reduced to $1,500 per month and Mary’s spousal benefit will be reduced to $750 per month. This means that their combined monthly benefit will be $2,250 ($1,500 + $750).
However, if John waits until his full retirement age of 66 to claim his benefits, his benefit will increase to $2,000 per month. This means that Mary’s spousal benefit will also increase to $1,000 per month. Their combined monthly benefit will now be $3,000 ($2,000 + $1,000).
In this case, waiting until full retirement age to claim benefits can result in an additional $750 per month in retirement income for John and Mary. This highlights the importance of considering spousal benefits when planning for retirement.
Statistics on Spousal Benefits Social Security
According to the Social Security Administration, in 2020, over 2.5 million people received spousal benefits, with an average monthly benefit of $785. This accounted for approximately 7% of all Social Security beneficiaries.
Additionally, the SSA reports that 55% of spousal beneficiaries are women, and 45% are men. This is likely due to the fact that women are more likely to have lower incomes and may not have their own work history, making them eligible for spousal benefits.
Spousal benefits social security are an important source of income for many married couples in retirement. They are designed to provide financial support to the non-working spouse and can have a significant impact on retirement planning. It is important for couples to understand how spousal benefits work and to consider them when making decisions about when to claim Social Security benefits.
If you are married and planning for retirement, it is recommended that you speak with a financial advisor or visit the Social Security Administration website to learn more about spousal benefits and how they may affect your retirement income. By understanding spousal benefits social security, you can make informed decisions that will help you and your spouse achieve a secure and comfortable retirement.