retirement

Social Security benefits and same-sex marriage

Impact on same-sex couples
Impact on same-sex couples © Jo Ann Snover/Shutterstock.com

Impact on same-sex couples

The finances of same-sex marriage partners were often crippled before their unions were legally recognized. One example: "For every $100 in retirement benefits a month they did not have access to," Rae says, "a gay couple had to save $24,000 or so to be in the same position at retirement as an opposite-sex couple who was depending on Social Security."

That $24,000 is the lump-sum amount needed to generate $100 in monthly income, assuming a withdrawal rate of 5%.

Even after the Supreme Court's DOMA decision, legally married gay couples ran into obstacles collecting Social Security benefits if they subsequently moved to a state that did not recognize their marriage.

The Social Security Administration deferred to state law on whether same-sex marriages were allowed or those from other states were recognized. But now, with the Supreme Court's Obergefell v. Hodges ruling that deems same-sex marriages legal nationwide, this will no longer be a problem.

And the Social Security Administration encourages same-sex couples to apply right away for benefits, even if they aren't sure they qualify. Applying could protect couples against the loss of any potential benefits.

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