Calculating Your Spousal Social Security Benefit: A Step-by-Step Guide

Calculating Your Spousal Social Security Benefit: A Step-by-Step Guide

For millions of seniors, Social Security provides a retirement safety net. About 21% of adults 50 and older have no other retirement income besides their benefits, according to a 2023 survey from the Nationwide Retirement Institute. It is therefore wise to maximize your monthly checks.

Retirement benefits are the most common form of Social Security, but they are not the only type of benefit you may be entitled to. If you are married or divorced, you may also be eligible for a form of spousal Social Security.

You will need to meet a few requirements to qualify, and the amount you receive will depend on several factors. Here’s your step-by-step guide to determining if you’re eligible and how much you can expect to raise.

Calculating Your Spousal Social Security Benefit: A Step-by-Step Guide

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Are you eligible for Social Security spousal benefits?

To qualify for spousal benefits, you must be currently married to someone who is eligible for retirement or disability benefits. You also generally must be at least 62 years old to start applying, unless you are caring for a child under 16 or disabled. In this case, you may be eligible for spousal benefits at any age.

Divorce benefits have a few additional requirements. For one, you cannot be currently married and your previous marriage must have lasted at least 10 years. If you have been divorced for less than two years, you will have to wait for your ex-spouse to start receiving Social Security before you can apply for divorce benefits. As with spousal benefits, you must also be at least 62 years old or responsible for a qualifying child.

With both types of benefits, your payments will have no impact on your spouse’s or ex-spouse’s benefits. If you are divorced and your ex-spouse has remarried, receiving divorce benefits will also not affect their current spouse’s ability to file for spousal benefits.

Calculate the amount of your benefit

Even if you’ve never worked, you can still collect hundreds of dollars a month from Social Security. For both spousal benefits and divorce benefits, the most you can receive is 50% of the amount your spouse or ex-spouse will receive at home. full retirement age (FROM).

If you worked enough to qualify for retirement benefits, this could affect your spousal or divorce benefits. The Social Security Administration (SSA) will pay your retirement benefit first. Then, if your spousal or divorce benefit is higher, you will receive an additional amount so that your total payment equals the greater of the two amounts.

For example, let’s say you are entitled to $900 per month in retirement benefits and your spouse is entitled to $2,000 per month in their FRA. Your maximum spousal benefit in this case is therefore $1,000 per month. The SSA will pay your $900 first, then you will receive an additional $100 per month in spousal benefits, so that your total payment is $1,000 per month.

If your retirement benefit is more than your maximum spousal or divorce benefit, you won’t be eligible for this type of Social Security at all. Let’s say, for example, that you qualify for $1,100 per month in retirement benefits in the previous example. Because this is higher than your maximum spousal benefit, you will only receive your retirement benefit of $1,100 per month.

Another factor affecting your monthly benefit

To receive the full spousal or divorce benefits you are entitled to, you will have to wait until your own FRA begins claiming. Your FRA will depend on your year of birth, but it is 67 for anyone born in 1960 or later.

You can file before your FRA (starting at age 62), but your benefit will be permanently reduced depending on the date you file. Additionally, unlike retirement benefits, delaying claiming beyond your FRA will not increase your spousal or divorce benefit. So there is no financial incentive to wait beyond your FRA to file.

This doesn’t necessarily mean you shouldn’t claim early, as there are valid reasons to do so. consider filing with your FRA. Just make sure you are aware that this will result in smaller payments each month.

Spousal or divorce benefits can go a long way in retirement, sometimes increasing your payments by several hundred dollars per month. By taking full advantage of all types of benefits to which you are entitled, you can prepare for a more comfortable retirement.

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Here’s how to calculate exactly how much spousal Social Security benefits you’re entitled to was originally published by The Motley Fool

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