When going through a divorce, Social Security is the last thing on your mind. But divorce can affect how much Social Security you get when you retire. In some cases, you may get a more considerable benefit than expected, while you may get nothing in others. Here’s how divorce and Social Security work together and how to plan to maximize your benefits.
Qualifying under your work record
The Social Security Administration (SSA) bases retirement benefits on the retiree’s work history. To be eligible for Social Security benefits, you must have worked for at least 40 “quarters of coverage” or ten years. You’ll get your full benefit at 67. However, you’ll reduce it if you claim it at 62 or increase it if you wait until 70. If you qualify for your own Social Security benefits, your divorce may have no impact on them. The SSA will compare your work record benefit to any potential spousal benefit, and you’ll get the higher of the two.
Spousal benefits for shorter marriages
Sadly, many divorced spouses don’t qualify for Social Security benefits, especially if they were homemakers before the divorce. If you were married less than ten years before the divorce, you’re ineligible for spousal benefits. That can be problematic for stay-at-home spouses with no work history. In that case, you’ll have no Social Security benefit and have to fund your retirement with outside savings and investments.
Spousal benefits if married for at least ten years
If you were married for at least ten years before divorcing, you might be eligible for Social Security benefits. Spouses married for ten years or more are entitled to the same spousal benefits. The ex-spouse pays no penalty and keeps their full retirement benefit.
Remember that if you remarried, you wouldn’t be eligible for a spousal benefit unless you were over 60.
The amount of a spousal benefit
The base spousal benefit is 50% of the primary beneficiary’s payment. You lose money if you retire before the Full Retirement Age (FRA)â€â€67 for those born after 1960. If you claim at age 62, your benefit may be reduced from 50% to 32.5% of the primary worker’s benefit. Waiting until 70 increases your Social Security benefit, but not spousal benefits, which are capped at 50% of the primary beneficiary. However, even that amount could be generous if you don’t qualify for your own Social Security benefit due to a lack of work history.
For those born before Jan. 2, 1954
You can still file and suspend if you were born before Jan. 2, 1954. That means you can file for spouse benefits at full retirement age and suspend your primary benefits immediately. Then, at 70, you can move from your spouse’s benefit to your own, presumably greater benefit. This procedure is no longer authorized. However, it’s grandfathered for people born before Jan. 2, 1954.
The spousal Social Security benefit
The most straightforward approach for claiming spousal Social Security is online. Other options are going to a Social Security office or calling 800-772-1213. You’ll need to present confirmation of citizenship or legal alien status and your final divorce judgment. The SSA will also ask for your name, gender, Social Security number, birthplace, job, and marriage(s). If you’re eligible, tell the SSA when you want to start receiving benefits, and they’ll take care of the rest.
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Bio:
Mark, a lifelong Tulsan graduated from Westminster College, Fulton, Missouri with a Bachelor of Arts in Accounting. Mark served in the United States Army as a Captain in the 486th Civil Affairs BN. Broken Arrow, Oklahoma and retired in 1996. Mark is married to his high school sweetheart Jenny and has four beautiful children. Mark’s passion for his work, which includes over 20 years in the Financial Industry started as an Oklahoma State Bank Examiner. Mark examined banks throughout Oklahoma gaining a vast knowledge and experience on bank investments, small business and family investments. Mark’s experiences include being formally trained by UBS Wealth Management, a global investment firm where he served as a Financial Consultant specializing in Wealth Management for individuals & families. Mark is a licensed Series 24 and 28 General Securities Principal and an Introducing Broker Dealer Financial Operations Principal. Additionally, Mark is a Series 7 and 66 stockbroker and Investment Advisor focusing on market driven investments for individuals, businesses and their families. Mark specializes in providing financial knowledge, ideas, and solutions for federal employees, individuals, families and businesses. We serve as your advocate, and assist you in the design and implementation of financial strategies while providing the ideas to maximize your security and wealth. Our goal is to give you maximum control of your financial future. We provide the expertise to help you with personal issues such as: practical tax Ideas, risk management, investment solutions, and estate preservation. Additionally, we’ve counseled hundreds of employees on their transitions from careers in federal government, and private industry to their next life stage, whether that is retirement or a second career. We specialize in devising strategies that roll your TSP, 401(k), pension plan, to a suitable IRA to meet your objectives.
Disclosure:
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