Are you leaving money on the table when it comes to your Social Security benefits?
What Are Spousal Benefits, Anyway?
You’re probably familiar with the idea of drawing Social Security benefits based on your own work history, but did you know that you might also be eligible for benefits based on your spouse’s earnings record? This is where spousal benefits come in – a way for married couples to maximize their Social Security payouts.
How Do Spousal Benefits Work?
In order to qualify for spousal benefits, you must be at least 62 years old and married to your spouse for at least one year. Additionally, your spouse must have filed for their own Social Security benefits, and you must be eligible for a benefit based on your own work record. The good news is that you can switch between your own benefit and a spousal benefit, or even receive both simultaneously, depending on which is more lucrative.
Maximizing Your Spousal Benefits
So, how can you make the most of this valuable benefit? Let’s break it down step by step:
Understanding the Rules
First, it’s essential to understand how the Social Security Administration (SSA) calculates spousal benefits. The SSA will pay you the higher of two amounts: 50% of your spouse’s full retirement benefit, or your own full retirement benefit. However, if you claim spousal benefits before your own full retirement age, your benefit will be reduced.
Claiming Strategies
Now that you know the rules, let’s talk strategy. Here are a few scenarios to consider:
Scenario | You | Spouse |
---|---|---|
Claim own benefit, then switch to spousal benefit | File for own benefit at 62, switch to spousal benefit at 66 | File for own benefit at 66 |
Claim spousal benefit, then switch to own benefit | File for spousal benefit at 66, switch to own benefit at 70 | File for own benefit at 66 |
Claim both benefits simultaneously | File for own benefit and spousal benefit at 66 | File for own benefit at 66 |
When to Claim: A Real-Life Example
Let’s say you and your spouse are both 62, and you’re trying to decide when to claim your benefits. Your own full retirement benefit would be $1,000 per month, while your spouse’s full retirement benefit would be $2,000 per month. If you claim your own benefit now, you’ll receive $800 per month (reduced because you’re claiming early). However, if you wait until your full retirement age of 66, you’ll receive the full $1,000 per month.
On the other hand, if you claim a spousal benefit based on your spouse’s earnings record, you’ll receive 50% of their full retirement benefit, or $1,000 per month. In this scenario, it might make more sense to claim the spousal benefit now and switch to your own benefit at 66, when it reaches its maximum amount.
Common Scenarios and Exceptions
What if You’re Divorced or Widowed?
Even if you’re no longer married, you might still be eligible for spousal benefits based on your ex-spouse’s earnings record. To qualify, you must have been married for at least 10 years, be at least 62 years old, and not be eligible for a higher benefit based on your own work record.
What if You’re Remarried?
If you’ve remarried, you generally won’t be eligible for spousal benefits based on your previous spouse’s earnings record. However, if your new spouse is also eligible for benefits, you might be able to claim a spousal benefit based on their record.
What if You’re Same-Sex Married?
The SSA recognizes same-sex marriages for the purpose of determining Social Security benefits, including spousal benefits. If you’re in a same-sex marriage, you can claim spousal benefits based on your spouse’s earnings record, just like opposite-sex couples.
FAQ
How Do I Apply for Spousal Benefits?
You can apply for spousal benefits online, by phone, or in person at your local SSA office. Be sure to have all necessary documents, including your birth certificate, proof of citizenship, and marriage certificate.
Can I Get Both My Own Benefit and a Spousal Benefit?
Yes, if you’re eligible, you can receive both your own Social Security benefit and a spousal benefit. The SSA will pay you the higher of the two amounts.
How Do Spousal Benefits Affect My Taxes?
Spousal benefits are subject to federal income tax, just like your own Social Security benefits. However, the tax implications will depend on your individual circumstances, so be sure to consult a tax professional for guidance.
Meta description: Learn how to maximize your Social Security benefits as a spouse, including strategies for claiming benefits and understanding the rules. Get the most out of your retirement with this comprehensive guide.