Over 53 million people received Social Security retirement benefits in August, with many of those relying on Social Security for a good portion of their retirement income. There are many working parts to Social Security, including different rules, eligibility thresholds, and benefit calculations for married couples versus single people.
If you're married, these three rules are worth noting, because they can impact how much you and your spouse receive and possibly affect your claiming decision.
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1. You can claim benefits based on your partner's earnings record
Your Social Security benefit is determined by your career earnings (called earnings record) and when you claim benefits. On a basic level, the more you earn, the more you pay in Social Security payroll taxes, and the higher your benefits (up to a certain cap each year).
An issue with this is that not everyone works for a living or has consistent income, in which case their benefits will be minimal or virtually nonexistent, depending on the case. The good news is that Social Security offers spousal benefits, allowing people to claim benefits based on their spouse's earnings record.
When you claim spousal benefits, you're eligible to receive up to 50% of your spouse's primary insurance amount (PIA), the monthly benefit someone receives by claiming benefits at their full retirement age (FRA).
To qualify, you must be married for at least a year, your spouse must currently be receiving benefits, and you must be at least 62 years old (or caring for a child under the age of 16 or with a disability that began before the age of 22).
If you're divorced and you were married for at least 10 years, you can also claim spousal benefits, as long as you're currently unmarried. If your ex-spouse has remarried, you're still eligible. In either case, you must still be at least 62 years old.
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2. Claiming spousal benefits early will also reduce monthly benefits
When you claim standard benefits early, they're reduced by five-ninths of 1% for each month, up to 36 months. Each additional month further reduces them by five-twelfths of 1%.
Spousal benefits are also reduced if you claimed before your FRA, just by different percentages. Your monthly benefit is reduced by 25/36th of 1% monthly for the first 36 months, and then five-twelfths of 1% for each additional month.
For someone whose FRA is 67 -- which is the case for anyone born in 1960 or later -- here is how the reductions differ between standard and spousal benefits:
| Claiming Age | Standard Benefit Reduction | Spousal Benefit Reduction |
|---|---|---|
| 62 | 30% | 35% |
| 63 | 25% | 30% |
| 64 | 20% | 25% |
| 65 | 13.3% | 16.7% |
| 66 | 6.7% | 8.3% |
Data source: Social Security Administration.
As an example, let's assume your spouse's PIA was $2,400. That means you would be eligible to receive $1,200 by claiming at your FRA. If you claimed benefits at 64 (assuming your FRA is 67), you would only be eligible to receive $900.
A key difference between standard and spousal benefits is that you won't receive delayed retirement credits if you delay claiming spousal benefits past your FRA. So if you're going to claim them, that should be the latest you realistically do it.
3. Spousal benefits are converted to survivor benefits when a spouse dies
If your spouse passes away while you're receiving spousal benefits, your benefits are generally converted to survivor benefits. When you receive these benefits, you'll get anywhere between 71.5% to 100% of your deceased spouse's benefits. Since spousal benefits are only up to 50% of your spouse's benefits, this will result in a boost.
To qualify for survivor benefits, you must meet the following criteria:
- Be at least 60 years old (50 to 59 if you have disability)
- Had been married for at least nine months before your spouse's death
- Didn't remarry before age 60 (50 if you have a disability)
Note: Spouses, ex-spouses, children (until age 18 or with a disability that began before age 22), and dependent parents are eligible for survivor benefits.
