Many women are unaware that if they become divorced, they may be eligible for Social Security benefits based upon their ex’s earnings record. These include spousal as well as survivor benefits.
As a women of divorce, the rules that govern what you may collect can be complex. This can have a significant impact upon your retirement finances.
Case study:
Stephanie is a divorced 71-year-old and has been collecting Social Security benefits based on her earnings since the earliest age of 62. Stephanie has since learned that she is eligible to claim a higher Social Security benefit based upon her ex-husband’s record. She is “dually entitled” to these two benefits and the total amount she can receive is the greater of the two amounts.
Stephanie missed the opportunity to claim the maximum amount of these benefits at her full retirement age (FRA) of 66 and has lost about 5 years’ worth of higher benefits. Full retirement age for many is age 66, should you claim your Social Security benefits before then, you will permanently lower your lifetime benefits.
The eligibility rules for divorced spouse benefits:
- Duration of marriage. She was married for more than the minimum 10 year requirement.
- Current marital status. She is not currently married making her eligible for benefits based upon her ex.
- Age. She is beyond the minimum age of 62 for spouse benefits.
- Ex-spouse status. Her ex is receiving his Social Security benefits.
- Independently entitled. Stephanie has been divorced for more than 2 years.
How benefits are calculated:
A person’s primary insurance amount (PIA), is the retirement benefit they will receive if they collect at their full retirement age (FRA). This amount is decreased if claimed earlier than the FRA and increased if claimed later than the FRA.
Stephanie can receive the maximum spousal benefit of 50% of her ex’s PIA if that amount is greater than her own benefit and she collects it at her FRA or later. This spousal benefit is decreased for claiming early but not increased if claiming later.
What should Stephanie do next?
To maximize her benefits and begin receiving the additional spouse amount she is entitled to, Stephanie should follow these steps:
- Reach out to the Social Security Administration (SSA) to initiate her claim for divorced spouse benefits by calling 1-800-772-1213. She can also contact her local SSA office.
- Gather the required documentation including her Social Security number (SSN), proof of her marriage and divorce, her ex’s birthday, place of birth and SSN if available.
- Request that her current benefit amount be adjusted to include the divorced spouse benefit. The SSA will calculate Stephanie’s updated monthly amount based on her and her ex-husband’s earnings records.
- Ask for up to six months of retroactive benefits to partially recover the lost income from the delayed claim.
If there is a dispute:
If Stephanie encounters issues or disagreements with the SSA’s determination, she can appeal the decision through the following process:
- Reconsideration. A complete review by someone not involved in the original decision.
- Hearing by an administrative law judge. If Stephanie disagrees with the reconsideration decision.
- Appeals Council review. If she disagrees with the hearing outcome.
- Federal court review. The final step if she disagrees with the Appeals Council’s decision.
Stephanie should act promptly at each stage as there are specific time limits for filing appeals.
This example of how to maximize your Social Security benefit as a woman of divorce is meant to assist you. At Retirement Solutions, we have over 40 years experience in helping women navigate the subject of Social Security. We employ a sophisticated computer program to help you decide when and how to claim your benefits so that you get the highest payout allowed by law.
Should you have any questions regarding this subject, you may take advantage of the report on the Retirement Solutions website: www.retirementsolutions.net. We also offer a complimentary no charge consultation to determine if we can be of assistance to you. Simply click on the “Schedule a Consultation” link in the upper right corner of the website. You talk, we listen.