Social Security - Spousal Benefits - Basics

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Topic Author
bkweathe
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Social Security - Spousal Benefits - Basics

Post by bkweathe »

I just read about spousal benefits a few days ago. Please help me understand them.

1. My wife has earned only a few SS credits; nowhere near 40. At some point, she'll be eligible for a spousal benefit of about 50% of my retirement benefit; I'll be able to collect my retirement benefit, too. So, between the two of us, we'll get about 150% of my retirement. Is that basically correct?

2. By the time I'm 62, she'll a few months past 66.5, her full retirement age. Can she she start taking her spousal benefits as soon as she turns 66.5? Or does she have to wait for me to turn 62? or for me to quit working? or for me start taking retirement benefits? or for anything else?

3. Will her spouse benefits increase if she waits to start taking them? As I understand it, they'll get bigger each month she waits from the time she turns 62 until she turns 66.5 but not after that. Is that correct?

4. I understand that my retirement benefits will keep increasing until I turn 70 if I wait to start taking them. Can she start taking her spousal benefits as soon as she hits 66.5 while I wait until I hit 70?

5. If I keep working after she starts taking her spousal benefits, will her spousal benefits be changed as my earnings record changes, or will they be fixed based on my record at the time she starts taking benefits?

Any help will be greatly appreciated!

Brad
BHUser27
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Re: Social Security - Spousal Benefits - Basics

Post by BHUser27 »

This page was really helpful for me...
https://www.ssa.gov/planners/retire/applying6.html

Click the "How Much Will I Receive?" drop-down for full explanation.
Even if you have never worked under Social Security, you may be able to get spouse’s retirement benefits if you are at least 62 years of age and your spouse is receiving retirement or disability benefits. You can also qualify for Medicare at age 65.
drawpoker
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Re: Social Security - Spousal Benefits - Basics

Post by drawpoker »

bkweathe wrote:.....At some point, she'll be eligible for a spousal benefit of about 50% of my retirement benefit; I'll be able to collect my retirement benefit, too. So, between the two of us, we'll get about 150% of my retirement. Is that basically correct?

Only if you wait to your own FRA to begin drawing.
Remember the percentages:
Start drawing at age 62 75% of PIA
Age 66 (or FRA) 100% of PIA
Age 70 $132% of PIA
Topic Author
bkweathe
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Re: Social Security - Spousal Benefits - Basics

Post by bkweathe »

joebh & BHUser27, Thanks! I'd read that page; I'm trying to make sure my understanding of it is correct. The word "may" in "...you may be able to get spouse’s retirement benefits..." especially concerns me. Under what conditions does "may" become "will"?

drawpoker, Thanks! So, if neither of us takes any benefits until I reach FRA, we'll get 100% of my retirement benefit plus her spousal benefits (50% of my retirement benefit), which adds up to 150% of my retirement benefit. Is that correct? Can she start taking her spousal benefit before I start taking my retirement benefit?
drawpoker
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Re: Social Security - Spousal Benefits - Basics

Post by drawpoker »

bkweathe wrote: Can she start taking her spousal benefit before I start taking my retirement benefit?
If you are asking about "file and suspend" strategy for couples, er, the gubmint took that option away around 3 months ago, remember.

http://www.pbs.org/newshour/making-sens ... -strategy/

http://money.usnews.com/money/retiremen ... d-strategy
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bkweathe
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Re: Social Security - Spousal Benefits - Basics

Post by bkweathe »

Thanks drawpoker!

I don't know if I'm asking about file & suspend, but I don't think I am.

I'm just trying to understand the basics of the spousal benefits!

As of a few days ago, I thought that our retirement income was going to consist of my SS retirement benefits, a small pension, and whatever I can get from my savings. Now, I seem to have found another pot of money called "SS spousal benefits". Can anyone simply confirm that this "pot" really exists, that I haven't somehow badly misread the information I've seen?

Brad
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HueyLD
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Re: Social Security - Spousal Benefits - Basics

Post by HueyLD »

The SSA link says:

"Even if you have never worked under Social Security, you may be able to get spouse’s retirement benefits if you are at least 62 years of age and your spouse is receiving retirement or disability benefits."

In other words, she cannot get the benefit unless you are also receiving the benefit.
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bkweathe
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Re: Social Security - Spousal Benefits - Basics

Post by bkweathe »

Thanks HueyLD! That helps me understand.

I thought I saw something about her being able to get the benefit once I was "eligible" for a benefit, not necessarily "receiving" a benefit. Maybe that's the obsolete "file and suspend" strategy that drawpoker mentioned?

But this previously-unknown-to-me spousal benefit is an additional source of income, on top of my retirement benefit, that we should be able to get, right?

Brad
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simplesimon
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Re: Social Security - Spousal Benefits - Basics

Post by simplesimon »

bkweathe wrote:Thanks HueyLD! That helps me understand.

I thought I saw something about her being able to get the benefit once I was "eligible" for a benefit, not necessarily "receiving" a benefit. Maybe that's the obsolete "file and suspend" strategy that drawpoker mentioned?

But this previously-unknown-to-me spousal benefit is an additional source of income, on top of my retirement benefit, that we should be able to get, right?

Brad
Yes, your spouse will be able to get the spousal benefit but only when you start collecting.

Per SSA.gov:
Even if you have never worked under Social Security, you may be able to get spouse’s retirement benefits if you are at least 62 years of age and your spouse is receiving retirement or disability benefits. You can also qualify for Medicare at age 65.
Since she will be past Full Retirement Age (FRA) by the time you're 62, then there won't be any reduction in her benefit so nothing to worry about there.

Her spousal benefit won't be able to exceed 50% of your FRA amount, which is the amount on your statement for age 67. If you wait until 70, you will get a larger amount of benefit, but your spouse's benefit will be 50% of the benefit you were eligible for at 67, not what you're getting at 70.

Math illustration, based on your benefit:
Age 62: $700/month, your spouse's benefit: $350 $500 (corrected because of spouse's age)
Age 67: $1000/month, your spouse's benefit: $500
Age 70: $1300/month, your spouse's benefit: $500

There is definitely more complicated math involved when you're working and taking social security that I don't know off the top of my head.
Last edited by simplesimon on Mon Aug 29, 2016 9:06 am, edited 1 time in total.
Topic Author
bkweathe
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Re: Social Security - Spousal Benefits - Basics

Post by bkweathe »

Thanks simplesimon! That's helpful!

In your illustration, I get the part about my wife's spouse being the same whether I retire @ 67 or 70. However, I thought that her benefit would also be the same whether I retire at 62 or 67 (except that my benefit, and, therefore, hers, might grow because of additional high-earnings years). I think you're saying that, if I retire early, her benefit will be half of my benefit. Is that right?

Brad
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Re: Social Security - Spousal Benefits - Basics

Post by vtMaps »

bkweathe wrote:I think you're saying that, if I retire early, her benefit will be half of my benefit. Is that right?
Not quite. Her benefit will be half of your PIA regardless of when you retire. (PIA= primary insurance amount = what you would get if you retire at full retirement age).

--vtMaps
"Truly, whoever can make you believe absurdities can make you commit atrocities" --Voltaire, as translated by Norman Lewis Torrey
Topic Author
bkweathe
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Re: Social Security - Spousal Benefits - Basics

Post by bkweathe »

Thanks vtMaps!

I don't understand how what you're saying matches up with the first line (age 62) of simplesimon's illustration. Is one of you mistaken or am I missing something?

Brad
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Epsilon Delta
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Re: Social Security - Spousal Benefits - Basics

Post by Epsilon Delta »

bkweathe wrote:Thanks simplesimon! That's helpful!

In your illustration, I get the part about my wife's spouse being the same whether I retire @ 67 or 70. However, I thought that her benefit would also be the same whether I retire at 62 or 67 (except that my benefit, and, therefore, hers, might grow because of additional high-earnings years).

Brad
Since she is over her FRA in all situations the spousal benefit should be half of your FRA benefit whenever you (and she) takes it.* In your particular case:
Age 62: $700/month, your spouse's benefit (at age 66.6): $500
Age 67: $1000/month, your spouse's benefit (at age 71.6 which is > 66.5): $500
Age 70: $1300/month, your spouse's benefit (at age, well lets not mention it but > 66.5): $500


* You should file at the same time.
casualflower
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Re: Social Security - Spousal Benefits - Basics

Post by casualflower »

So, my reading of this is that:

If a person's benefit will not exceed their spouse's benefit, then earning any benefit greater than 50% of their spouse's is a 'waste' of FICA taxes.

Is that accurate?
vtMaps
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Re: Social Security - Spousal Benefits - Basics

Post by vtMaps »

metrunt wrote: If a person's benefit will not exceed their spouse's benefit, then earning any benefit greater than 50% of their spouse's is a 'waste' of FICA taxes.
If their benefit is greater than 50% of their spouses PIA, then they would take their own benefit rather than spousal benefit. Further, they could take their benefit before their spouse takes his/her benefit.

--vtMaps
"Truly, whoever can make you believe absurdities can make you commit atrocities" --Voltaire, as translated by Norman Lewis Torrey
casualflower
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Re: Social Security - Spousal Benefits - Basics

Post by casualflower »

Ah, I was reading that differently.

"If you qualify for benefits on your own record, we will pay that amount first. If the benefit on your spouse’s record is higher, you'll get an additional amount on your spouse’s record so that the combination of benefits equals that higher amount."

"at your full retirement age, your benefit as a spouse cannot exceed one-half of your spouse's full retirement amount."

So you always take your benefit. Then you get a spousal benefit.

The way that looks to me is if your spouse's amount is $1,200 and your benefit is $1199, you get $1 from the "spousal benefit". If spouse is $1,200 and you're $600, you get $600. If spouse is $1,200 and you're $500, you still get $600.

What am I missing?
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BL
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Re: Social Security - Spousal Benefits - Basics

Post by BL »

1. My wife has earned only a few SS credits; nowhere near 40. At some point, she'll be eligible for a spousal benefit of about 50% of my retirement benefit; I'll be able to collect my retirement benefit, too. So, between the two of us, we'll get about 150% of my retirement. Is that basically correct?
Don't know how old she is but why not do a bit of part time each year to get 4 credits until she has 40 credits (~10 years)? SS low incomes get back a huge % of average earnings.
The amount of earnings it takes to earn a credit has changed since 1978. In the year 2016, you must earn $1,260 in covered earnings to get one Social Security or Medicare work credit and $5,040 to get the maximum four credits for the year.
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Re: Social Security - Spousal Benefits - Basics

Post by drawpoker »

Maybe this isn't a good time to bring this up but, um, you need to remember the insurance component of the whole social security picture, not just old age benefits, here as it relates to spouses.
Er, meaning, that when you, um, eventually curl up and dye, the surviving spouse automatically is upped from the small spousal benefit check to the amount of late husband's check
Does that make you feel any better.... :wink:
SSA uses the term "spousal" loosely, not in its legal sense.
Meaning, if you have any ex-wives still around, they too are entitled to a spousal benefit of one-half if the marriage lasted 10 years and they have attained age 62. And these payouts to exes have no effect or reduce any of your or your current spouse's benefits.
FB01
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Re: Social Security - Spousal Benefits - Basics

Post by FB01 »

Sorry guys...

this is really new to me. I just want to clarify if someone can simply answer yes or no

- My wife does not have 40 credit.

If i retire (whatever age), there will also be SS Spousal benefit. If I am getting $3000, my wife will also get $1500 (even though she has not worked to reach credit) so totally...I will be getting a check of $4500 every month...

Is my understanding correct? Can you anyone please confirm.

-JR
Thanks, | FB
drawpoker
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Re: Social Security - Spousal Benefits - Basics

Post by drawpoker »

FB01 wrote:......If i retire (whatever age), there will also be SS Spousal benefit. If I am getting $3000, my wife will also get $1500 (even though she has not worked to reach credit) so totally...I will be getting a check of $4500 every month...

Is my understanding correct? Can you anyone please confirm.

-JR
Well, er, Gulp .... :shock:

No, can't confirm, um, "YOU Will Be Getting a Check of $4,500 every Month"


SSA will issue individual checks for each beneficiary. So, um, if your spouse wants to blow her check on $1,500 worth of Jimmy Choo shoes every month, yup, giddy-up, she can do it ! :D

That's how it works.
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BL
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Re: Social Security - Spousal Benefits - Basics

Post by BL »

If i retire (whatever age), there will also be SS Spousal benefit. If I am getting my PIA (at FRA) is $3000, my wife will also get $1500 since she will be above FRA (even though she has not worked to reach credit) so totally...I will be getting a check of $4500 a certain amount depending on when I begin (which is increased or decreased depending on whether I begin after or before FRA) every month...and she will get $1500 if I am drawing SS.

She will also get widow's benefit of whatever amount I am getting instead of her spousal if I die before she does.
Last edited by BL on Sun Aug 28, 2016 12:01 am, edited 2 times in total.
FB01
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Re: Social Security - Spousal Benefits - Basics

Post by FB01 »

drawpoker wrote:
FB01 wrote:......If i retire (whatever age), there will also be SS Spousal benefit. If I am getting $3000, my wife will also get $1500 (even though she has not worked to reach credit) so totally...I will be getting a check of $4500 every month...

Is my understanding correct? Can you anyone please confirm.

-JR
Well, er, Gulp .... :shock:

No, can't confirm, um, "YOU Will Be Getting a Check of $4,500 every Month"


SSA will issue individual checks for each beneficiary. So, um, if your spouse wants to blow her check on $1,500 worth of Jimmy Choo shoes every month, yup, giddy-up, she can do it ! :D

That's how it works.
Thanks for your confirmation. This is a nice surprise while going through this forum. I was under the impression that we will have to survive on just one SS check..this is really extra bonus....
Thanks, | FB
TravelforFun
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Re: Social Security - Spousal Benefits - Basics

Post by TravelforFun »

FB01 wrote:Sorry guys...

this is really new to me. I just want to clarify if someone can simply answer yes or no

- My wife does not have 40 credit.

If i retire (whatever age), there will also be SS Spousal benefit. If I am getting $3000, my wife will also get $1500 (even though she has not worked to reach credit) so totally...I will be getting a check of $4500 every month...

Is my understanding correct? Can you anyone please confirm.

-JR
Your wife can get her spousal benefit regardless of whether or not she has 40 credits if: 1) you file and receive your own benefit (anytime after you turn 62), and 2) your wife files for spousal when she is at her full retirement age (FRA). Her spousal benefit will be half of your FRA benefit.

Using your numbers, if you file at 62, you'd get $2,250 (75% of your full or FRA benefit), when your wife files for spousal at her FRA, she'd get $1,500. Total: $3,750.

If you file at your FRA. you'd get $3,000, your wife's spousal is still $1,500. Total $4,500.

Hope that helps.
FB01
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Re: Social Security - Spousal Benefits - Basics

Post by FB01 »

TravelforFun wrote:
FB01 wrote:Sorry guys...

this is really new to me. I just want to clarify if someone can simply answer yes or no

- My wife does not have 40 credit.

If i retire (whatever age), there will also be SS Spousal benefit. If I am getting $3000, my wife will also get $1500 (even though she has not worked to reach credit) so totally...I will be getting a check of $4500 every month...

Is my understanding correct? Can you anyone please confirm.

-JR
Your wife can get her spousal benefit regardless of whether or not she has 40 credits if: 1) you file and receive your own benefit (anytime after you turn 62), and 2) your wife files for spousal when she is at her full retirement age (FRA). Her spousal benefit will be half of your FRA benefit.

Using your numbers, if you file at 62, you'd get $2,250 (75% of your full or FRA benefit), when your wife files for spousal at her FRA, she'd get $1,500. Total: $3,750.

If you file at your FRA. you'd get $3,000, your wife's spousal is still $1,500. Total $4,500.

Hope that helps.
One follow up questions

So after FRA, I am getting $3000 and my wife who has not reached 40 credits is getting half of what I am getting which $1500 so totaling $4500 (really sweet as this is a surprise for me)

Now, what will my wife gets, If I pass away. Does she get what I was getting or she gets her half which she was getting?

Thanks,
JR
Thanks, | FB
TravelforFun
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Re: Social Security - Spousal Benefits - Basics

Post by TravelforFun »

FB01 wrote:
TravelforFun wrote:
FB01 wrote:Sorry guys...

this is really new to me. I just want to clarify if someone can simply answer yes or no

- My wife does not have 40 credit.

If i retire (whatever age), there will also be SS Spousal benefit. If I am getting $3000, my wife will also get $1500 (even though she has not worked to reach credit) so totally...I will be getting a check of $4500 every month...

Is my understanding correct? Can you anyone please confirm.

-JR
Your wife can get her spousal benefit regardless of whether or not she has 40 credits if: 1) you file and receive your own benefit (anytime after you turn 62), and 2) your wife files for spousal when she is at her full retirement age (FRA). Her spousal benefit will be half of your FRA benefit.

Using your numbers, if you file at 62, you'd get $2,250 (75% of your full or FRA benefit), when your wife files for spousal at her FRA, she'd get $1,500. Total: $3,750.

If you file at your FRA. you'd get $3,000, your wife's spousal is still $1,500. Total $4,500.

Hope that helps.
One follow up questions

So after FRA, I am getting $3000 and my wife who has not reached 40 credits is getting half of what I am getting which $1500 so totaling $4500 (really sweet as this is a surprise for me)

Now, what will my wife gets, If I pass away. Does she get what I was getting or she gets her half which she was getting?

Thanks,
JR
Yes she gets what you were getting.
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bkweathe
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Re: Social Security - Spousal Benefits - Basics

Post by bkweathe »

Many thanks to all who chimed in on this!

To summarize, I think that the answers to my original questions are as follows:
1. My wife has earned only a few SS credits; nowhere near 40. At some point, she'll be eligible for a spousal benefit of about 50% of my retirement benefit; I'll be able to collect my retirement benefit, too. So, between the two of us, we'll get about 150% of my retirement. Is that basically correct?

Yes. That's the general idea, but there will be adjustments based on our ages when we start collecting benefits.

2. By the time I'm 62, she'll be a few months past 66.5, her full retirement age. Can she she start taking her spousal benefits as soon as she turns 66.5? Or does she have to wait for me to turn 62? or for me to quit working? or for me start taking retirement benefits? or for anything else?

She can't get benefits until I start taking benefits.

3. Will her spouse benefits increase if she waits to start taking them? As I understand it, they'll get bigger each month she waits from the time she turns 62 until she turns 66.5 but not after that. Is that correct?

Yes, that's correct. Her benefits won't increase due to age, but they might increase due to my earnings record.

4. I understand that my retirement benefits will keep increasing until I turn 70 if I wait to start taking them. Can she start taking her spousal benefits as soon as she hits 66.5 while I wait until I hit 70?

Nope. She can't get benefits until I do.

5. If I keep working after she starts taking her spousal benefits, will her spousal benefits be changed as my earnings record changes, or will they be fixed based on my record at the time she starts taking benefits?

Not sure of the answer to this one. Anyone? (Of course, since she can't get here benefits until I get mine, I'm not likely to keep working, so this is probably a moot point.)
Is that an accurate summary?
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Re: Social Security - Spousal Benefits - Basics

Post by vtMaps »

bkweathe wrote: Is that an accurate summary?
Yes, to the best of my knowledge. --vtMaps
"Truly, whoever can make you believe absurdities can make you commit atrocities" --Voltaire, as translated by Norman Lewis Torrey
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Re: Social Security - Spousal Benefits - Basics

Post by ObliviousInvestor »

bkweathe wrote:5. If I keep working after she starts taking her spousal benefits, will her spousal benefits be changed as my earnings record changes, or will they be fixed based on my record at the time she starts taking benefits?

Not sure of the answer to this one. Anyone? (Of course, since she can't get here benefits until I get mine, I'm not likely to keep working, so this is probably a moot point.)
If your PIA increases as a result of additional earnings, her benefit as your spouse will increase as well, because it is a function of your PIA.
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Re: Social Security - Spousal Benefits - Basics

Post by Texanbybirth »

Thanks for this thread, it was very informative for me as an observer.

In the event of my demise, I've read that a surviving spouse caring for my children 16 or under will get a benefit from my SS earnings record. Does that benefit for my wife stop when our child turns 16? Does it then begin again when my wife would choose to receive it? Say 60 or full retirement age or whatever? I'm 31, she's 30, and our children are 1 and 0.
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Re: Social Security - Spousal Benefits - Basics

Post by pshonore »

Texanbybirth wrote:Thanks for this thread, it was very informative for me as an observer.

In the event of my demise, I've read that a surviving spouse caring for my children 16 or under will get a benefit from my SS earnings record. Does that benefit for my wife stop when our child turns 16? Does it then begin again when my wife would choose to receive it? Say 60 or full retirement age or whatever? I'm 31, she's 30, and our children are 1 and 0.
That's essentially correct. The kids would also get a benefit until earlier of age 19 or high school graduation. There is a family maximum however which is usually on your yearly SS estimate. And your wife's benefit would be subject to earned income limits if she is working.
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