retirement

Remarriage saps Social Security benefit

Don Taylorq_v2.gifDear Dr. Don,
My wife and I both work and will be entitled to Social Security. We've been married longer than 10 years. If we divorced, how would that impact Social Security benefits? Would she get only benefits based on her lower salary, or based on my higher salary?
-- Marty Marital

a_v2.gifDear Marty,
Your benefits are based on your work history. Spousal benefits can be higher than the benefits earned by your work history. There are some optimizations of benefit strategies that can have a spouse, or ex-spouse, decide to start with one type of benefit and then later elect to switch to the other. Those strategies aren't really part of your question, so I'll hold them in abeyance.

Her ability to claim spousal benefits based on your work history depends in part on whether she remarries after the divorce. Here's an excerpt from the Social Security's FAQ page "Marriage, divorce and name changes":

How divorce affects your future retirement benefits

If you are divorced after at least 10 years of marriage, you can collect retirement benefits on your former spouse's Social Security record if you are at least age 62 and if your former spouse is entitled to or receiving benefits. If you remarry, you generally cannot collect benefits on your former spouse's record unless your later marriage ends (whether by death, divorce or annulment). For more information, see "If you are divorced."

From the "If you are divorced" publication, here are some additional nuggets on strategies the spouse can choose in collecting benefits:

If your ex-spouse has not applied for retirement benefits, but can qualify for them, you can receive benefits on his or her record if you have been divorced for at least two years.

If you are eligible for retirement benefits on your own record we will pay that amount first. But if:

  • The benefit on his or her record is a higher amount; you will get a combination of benefits that equals that higher amount (reduced for age).
  • You have reached full retirement age and you are eligible for a spouse's benefit and your own retirement benefit, you have a choice.

You can choose to receive only the divorced spouse's benefits now and delay receiving retirement benefits until a later date. If retirement benefits are delayed, a higher benefit may be received at a later date based on the effect of delayed retirement credits.

You don't have to worry about how her benefit election impacts you because it doesn't affect your benefits. As it states in the Social Security publication "Benefits for your divorced spouse": "The amount of benefits your divorced spouse gets has no effect on the amount of benefits you or your current spouse may receive."

So you can stop worrying about what she might get in Social Security benefits if you divorce.

Read more Dr. Don columns for additional personal finance advice.

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