Published on: January 25, 2023
The Social Security Administration (SSA) administers three programs to provide financial support to different groups of Americans who are either unable to work due to a disability or who reached their full retirement age (FRA). Each program is governed by a distinct set of rules that can seem complicated to someone unfamiliar with the government’s system.
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How Are Spousal Benefits Determined?
Every individual and all married couples will earn different amounts of income over the course of their working life. Some couples include one income earner and another who remains at home performing other unpaid work. The Social Security programs were designed to apply across the board, covering every eligible person who fits into the criteria of one or more programs.
For Social Security Old Age Retirement (SSOAR) benefits and Social Security Disability (SSD) benefits, the monthly payments to recipients are based on their lifetime earnings. The SSOAR and SSD programs use the same formula to determine the amount paid to program beneficiaries.
The Social Security Administration looks at the 35 highest earning years during the applicant’s working career and adjusts each year to account for an increase in the cost of living. Then it adds those 35 incomes together, divides the sum by 35 to find an annual average income, and then divides again by 12 to find the Average Indexed Monthly Earnings (AIME).
It is this AIME figure that the SSA plugs into a formula that produces each eligible worker’s Primary Insurance Amount (PIA), the amount each recipient receives based on their career’s taxable earnings.
The spouse of a deceased worker will receive 100 % of their partner’s Social Security Disability benefits when the surviving spouse reaches their full retirement age (FRA). If a surviving spouse younger than their FRA applies for survivor benefits based on a deceased spouse’s work history, they would receive a smaller percentage of their late spouse’s benefits. The surviving spouse could not receive more than the original worker would have received in SSOAR benefits if the deceased themselves filed before they reached their FRA.
If Both Spouses Are Eligible for Social Security Old Age Retirement
When both spouses work and are eligible for their own Social Security Old Age Retirement benefits, the lower-earning spouse has several options. But let’s assume the couples described in this section of our blog post have all reached the full retirement age.
If the higher-earning spouse’s benefits are more the twice the dollar value of the benefits the lower-earning spouse receives, then the spouse receiving the lesser amount can claim spousal benefits under their partner’s earnings. That will increase the lower benefit amount to as high as half the higher earner’s benefit amount.
However, if the higher-earning spouse dies, the spouse that opted to receive the one-half spousal benefit is eligible to switch over and receive 100 % of their now deceased partner’s benefit.
However, if the lower-earning spouse is the first to die, the surviving widowed spouse would choose to continue to collect the benefits earned on their own work history. So, in this case, the survivor would not submit a survivor’s benefit claim.
Divorce Spouse Is Also Eligible to Receive Retirement Benefits Based on Their Ex’s Record
Divorced spouses who survive their former spouse are equally entitled to claim survivor benefits based on their ex-spouse’s working career if the marriage lasted for at least 10 years and the divorced survivor does not marry until after they reach age 60.
This is true even if the deceased former spouse remarried and their current spouse also files for survivor benefits based on the decedent’s working history. The amounts paid to other surviving claimants are unaffected by the benefits paid to a surviving divorced spouse. Both the current and the former surviving spouses could receive 100 % of their late spouse’s benefits.
Applying for Survivor Benefits Before Reaching Full Retirement Age (FRA)
Applying for any Social Security Old Age Retirement benefits before reaching full retirement age will reduce the percentage surviving spouses receive. Social Security retirement benefits cannot be claimed until at least age 62. And if the claim is made anytime between age 62 and the claimant’s full retirement age, then they receive a lower percentage of their full retirement age benefit amount for the rest of their life. Similarly, when a surviving spouse files early for benefits through their deceased spouse’s work history, the rules provide the following:
- Surviving spouse aged 60 thru FRA receives between 71 ½ % to 99 % of the decedent’s benefit;
- Disabled surviving spouse aged 50 thru 59 receives 71 ½ % of the decedent’s benefit;
- Surviving spouse at any age caring for a child under 16 years old receives 75 % of the decedent’s benefits.