If your wife is eligible to collect a spousal benefit, whether or not it is paid automatically can depend on when each of you claims benefits. If your wife claims benefits on her own employment history after you are already getting Social Security payments, Social Security will determine whether a spousal benefit or a benefit based on her own work record is higher. Then it will automatically begin paying the higher benefit. Many factors such as age can also affect eligibility. To ensure you’re making the most of your hard-earned benefits, consult with a qualified financial advisor.
Spousal Benefit Example
Someone with a spouse eligible for a $3,750 Social Security primary benefit may be able to receive a spousal benefit equal to half that amount, or $1,875. The spousal benefit claimant would generally need to wait until reaching age 62 in order to receive any benefit, though there are some exceptions to these rules as noted below.
In addition, claiming spousal benefits before reaching full retirement age will reduce the spousal benefit. For instance, claiming two years early at age 65 when full retirement age is 67 will reduce the benefit to just 41.67% of the primary benefit amount, or $1,562.62. The precise amount in a specific case can be calculated using Social Security’s online Benefits for Spouses calculator.
A financial advisor can help you integrate your Social Security benefits into your larger retirement plan.
Spousal Benefit Rules
There are a handful of rules to keep in mind when planning your Social Security benefits.
In most cases, Social Security won’t pay spousal benefits to a spouse until they are at least 62 years old. A couple of exceptions exist. One is for a spouse who provides care for a child under age 16. Another is when the child being cared for has a disability and is eligible for benefits based on the other spouse’s work history. If either of these conditions are in effect, a spouse can claim spousal benefits before age 62.
In any case, Social Security will pay spousal benefits only if the spousal benefit amount is higher than the claimant would receive based on their own work record. Also, the spousal benefit is only paid in most cases if the spouse with higher earnings has started receiving benefits. If this condition is met, Social Security does the calculations and automatically pays the larger amount when the lower-earning spouse files to receive benefits.
The amount of the spousal benefit is based on 50% of the higher-earning spouse’s benefit if they claim at full retirement age. Note that even if the higher-earning spouse claims their benefit later than full retirement age, the base spousal benefit is still half of the higher-earning spouse’s full retirement age benefit.
Another factor is the age of the person claiming the spousal benefit. If someone claims a spousal benefit before reaching full retirement age, in most cases it reduces the amount of the spousal benefit awarded by Social Security. Again, the exception is for a spouse caring for a qualifying child. Absent a qualifying child, the benefit can be reduced by up to 35%.
Bottom Line
In most cases a spouse can claim spousal benefits equal to as much as half the benefit received by a higher-earning partner. If the higher-earning partner has already started getting benefits, all the spouse has to do is file to receive benefits based on their own earning record. Social Security will determine which benefit would be the largest and automatically begin paying that. Otherwise, the lower-earning partner can file to receive their own benefits and then notify Social Security when the higher-earning partner claims. Again, Social Security will determine which benefit is larger and pay that amount. A number of factors may affect eligibility for spousal benefits as well as the amount paid.
Tips
- A one-size-fits-all approach to Social Security may not be the best solution. By working with a financial advisor, you’ll receive tailored guidance that considers your specific circumstances, goals, and retirement aspirations. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors in your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- Use SmartAsset’s Social Security Calculator to estimate your future benefits using your age, income and planned age at retirement.
- Keep an emergency fund on hand in case you run into unexpected expenses. An emergency fund should be liquid — in an account that isn’t at risk of significant fluctuation like the stock market. The tradeoff is that the value of liquid cash can be eroded by inflation. But a high-interest account allows you to earn compound interest. Compare savings accounts from these banks.
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