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3 Things to Know About Social Security if You're Divorced – The Motley Fool



Did you know Social security benefits to some ex-spouses who have gotten divorced?

Social security benefits now provide half or more of the income received in retirement for 69% of unmarried Americans and 48% of married couples , according to the Social Security Administration (SSA).

 Wedding cake with bride and groom facing away from each other

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Divorced after 10 years and single? You may be eligible for a spousal benefit

You may be eligible for a spousal benefit if you are currently single but have been divorced after 1

0 years of marriage or more. You may be entitled to claim Social Security benefits on your ex-partner's work record. For you to do so, your ex-spouse must be eligible for Social Security, and must be at least 62 years of age.

Although they are eligible to receive Social Security at 62, it is possible that your ex may not choose to start receiving benefits then. Why? Because recipients receive roughly 8% more in Social Security benefits for every year they delay receiving benefits between 62 and the age of 70. Plus people do not reach full retirement age (FRA) until sometime between age 65 (for those born in 1937 or before) and 67 (for those born in 1960 and later), with incremental hikes for those born between those years

But whether your ex is receiving Social Security or not is of no concern to you as a divorced husband. As long as your ex-wife qualifies for benefits and is 62 or older, you may be eligible for a spousal benefit, whether your ex is receiving them or not. Your ex-wife's marital status does not matter. They can be remarried, divorced again, or have stayed single – it does not have any bearing on your ability to file a claim, or how much it will be. Your claim will have no effect on the amount of your ex benefits. If you have been remarried, the new partner's potential benefits are not affected.

If your ex has not yet applied for Social Security benefits, however, there is a requirement that you need to have been divorced and a minimum of two years to receive the spousal benefit

So far, so clear. But there are three important things to know if you meet those qualifications.

Three important requirements

  1. You can not claim benefits if you are remarried. If, however, you remarried and then divorced again, you may claim the benefits of a divorced partner, as long as the marriage lasted at least 10 years.
  2. You must be 62 or older to apply for benefits

How are Social Security benefits calculated?

So how do you know if your benefit would be less than the benefit you would receive by claiming on your ex's work record? First, you will need to find your own benefit amount, which the SSA calculates based on two things: your work history and your earnings history

To receive Social Security, you need a work history in which they accumulate a total of 40 lifetime work credits. A work credit is a metric based on income. Last year, for example, workers earned one lifetime work credit for every $ 1,320 they earned. That's going up this year: workers will earn one lifetime work credit for every $ 1,360 earned.

Even if someone brings home a cool million per year, they can not earn the entire 40 work credits needed in a year. In fact, four are the most likely people to receive in one year.

Once you qualify for the work credits, your earnings history kicks in to determine the amount you're entitled to. The SSA calculates benefits on the 35 highest-earning, inflation-adjusted years. If you have worked less than 35 years, $ 0 is averaged in the monthly payout calculations for each year under 35.

How are Social Security Spousal Benefits calculated

Now, these calculations are for an individual receiving Social Security.

If you qualify, the benefit for a divorced spouse is 50% of your ex's full retirement amount, if you start taking benefits at your FRA. So if your ex is eligible for $ 2,000 each month in Social Security benefits, you would receive $ 1,000. If your ex-delays have been retired through their FRAs, the concomitant increase in benefits amounts will not be applied to your spousal benefit.

What if you are eligible under your own work and earnings history and your ex? Do you have to select which one to claim on? No. The SSA will pay your own retirement benefit first and then calculate your potential benefit from your ex work and earnings history. Once you have both, the SSA will adjust the benefit so you will receive the highest amount.

People who are eligible for both have their FRA's birthday before January 2, 1954 have an important option to maximize their Social security benefits too: You can decide to get just the benefit for divorced spouses and delay taking your own. That way, you can receive the 8% yearly hike in your eventual benefit amount between your FRA and 70.

But if your birthday is January 2, 1954 or later, that choice has been phased out unfortunately.


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