What Most Retirees Don't Know About Social Security Survivor Benefits
Friends, and welcome back to another episode of Retirement Answers. My name is Jacob Duke. I'm your host as always. This week on the show, we're talking about everything around Social Security survivor benefits and everything that you need to know about that. Last week, we talked about spousal benefits and some of the nuances and the rules there.
Jacob:So if you're interested in spousal benefits specifically, you can go back and listen to that episode. But today we are covering survivor benefits and I just want you to know that they are different. There are different rules and things that apply to both these Social Security benefits differently. So some people get them confused, which is totally understandable because it's definitely not easy to understand or see the differences between them. But I'm excited to jump into this episode because it is very confusing.
Jacob:There are so many little nuances and so many little details that you just can't know as you're approaching retirement or someone who could even be eligible for these survivor benefits. So you have so many questions maybe in your mind, and we're going to go through all those different things today to make sure you have a clear and good understanding of what's happening and some of the opportunities that might be available to you as a surviving spouse or perhaps even a surviving ex spouse. So this episode might get a little bit technical, which is completely fine, because we've got to kind of wade through some of the technicalities to come out the other side to really simplify it and give you a clearer sense of what's going on. So the hard part about Social Security is there's just so many different parts or like types of benefits and things to know. You have your own benefits and different rules that are tied to that.
Jacob:You have spousal benefits, which we talked about last week that has its own set of rules and just different things to know. You have Social Security Disability and those rules that apply to that. And now we have survivor benefits and some of the things we have to know here. So the main thing you got to know is there's different acronyms as there is with anything in finance, but some of the acronyms that are important to understand here as we think about Social Security are going to be FRA and PIA. So FRA stands for Full Retirement Age, is the age in which you are eligible to begin receiving your full benefit in terms of what you paid into the Social Security System over your working career.
Jacob:Now, your PIA is actually the amount that you are eligible to receive at your full retirement age. So PIA stands for primary insurance amount, and that is what we call your full benefit. So if you take your benefits before your FRA, your full retirement age, you're gonna get a reduced amount moving forward. And if you delay it past your FRA, you would get an increased amount beyond your full benefit. And again, your full benefit is the PIA.
Jacob:Now it would be great if things were that easy, but unfortunately they are not because the FRA that we all know about and think about when we hear the words full retirement age applies to us taking our own benefits, but for survivor benefits, your FRA might not be the same as your normal full retirement age. So let's take a minute to sort this out because whenever we're talking about your full retirement age, it applies to you taking your own benefits and here are the full retirement ages and how this works. If you were born before 1955, your full retirement age is 66 years old. And for every year after that, from 1955 through 1959, the full retirement age increases by two months. So if you were born in 1955, your full retirement age is sixty six and two months.
Jacob:If you were born in 1956, your full retirement age is sixty six and four months and so on. So we're adding two months every year until 1959. Now, if you were born in 1960 or after that, your full retirement age is 67. So that's how the normal full retirement age works and how it's determined, but the full retirement age or FRA for survivor benefits is slightly different. So instead of starting with the birth year of 1955 and then going from there, it actually starts with 1957 and follows that same two month increase for each following year until 1962.
Jacob:So if you were born before 1957, your FRA would be 66, and then every year after that has that same two month increase in your FRA age. And for anyone born 1962 or after the full retirement age for Survivor Benefits is 67. So the FRA ages are actually the same, whether it be for normal benefits or survivor benefits, but the year of birth determining which FRA yours is for survivor benefits, that's what's different from the normal full retirement age schedule. So if you were born in 1960, your normal FRA would be 67, but your survivor FRA would be 66 and eight months. So technically, you would reach your survivor FRA slightly before you actually reach your normal benefit for retirement age.
Jacob:So as we're going through this conversation today, it's important to know this because I'm gonna be mentioning FRAs throughout the episode and depending on the subject that I'm talking about, person in that particular sentence that I'm talking about it, it might be different. So the FRA mentioned could be for your own normal benefits in one instance, and then could be for survivor benefits in the next. So for example, if I say that your spouse passed away before their FRA, but you were still before your own FRA, so you would get a decreased survivor benefit, what we're talking about there is two different FRAs in this instance. The full retirement age for the deceased spouse is talking about their normal benefits FRA, and the full retirement age for you as a surviving spouse is actually referring to your survivor benefit FRA. So hopefully that makes a little bit of sense.
Jacob:If it doesn't, maybe re listen to that really fast. I wish it were simpler, but it's not. And that's really why I'm making this episode today. Let's kind of outline what we're going to cover here in today's episode. The first thing is we're going to explain what a survivor benefit is just broadly, and then we're going to go more granular from there.
Jacob:We're We're gonna answer some specific questions that I commonly get things like do I get my Social Security benefits and survivor benefits on top of that? How much will my survivor benefits be? When am I eligible to receive my survivor benefits? Do I have to take survivor benefits immediately or is there a way to delay those? What happens if my deceased spouse wasn't actually receiving their benefits yet before they pass away?
Jacob:What happens in that scenario? Also things like am I entitled to survivor benefits if I'm divorced or if my ex spouse has passed away? What if I get remarried? Do I give up those survivor benefits? So many questions and things to cover here, so let's go ahead and just dive in.
Jacob:The first thing is what is a survivor benefit? In simplest form, it's just a Social Security benefit that you could be entitled to when your spouse passes away. So it's pretty self explanatory, it's whenever you survive your spouse. Now, who is actually entitled to these benefits? There are a few different categories of people or types of persons that can actually get these survivor benefits.
Jacob:So I'm going to list these out, and then we'll go from there. The first thing is you must be a surviving spouse, and you must be 60 or older before you're eligible to begin receiving survivor benefits. So that's the most common category of person, but there are other categories. So most people fall into that one there where you have to at least be 60 or older to receive these surviving benefits, or you might fall into these categories and about to explain next, which the next one is, if you are a surviving spouse, but you are disabled. If you're disabled and you're surviving spouse, then you are actually eligible to begin receiving your survivor benefits at age 50.
Jacob:Also, if you're a surviving spouse and you're caring for a child under age 16, guess what? You can receive survivor benefits regardless of your own age until that child is 16. So if you have a child who's 13 and you are caring for them and your surviving spouse, you can receive survivor benefits until that child is 16, and that's regardless of your age, you could be 45 and actually still get your survivor benefits. So, there's no age requirement on your behalf, it's just if you're caring for a child under 16. The next category is a surviving child.
Jacob:So, someone who's actually a child of someone who's passed away, they're entitled to survivor benefits if they are under age 18, or age 19 if they're still in secondary school, so think like high school, or if they are disabled, they're actually entitled to survivor benefits until they surpass that age. So if you're a child and your mom passes away and you are 17 years old, guess what? You are entitled to a survivor benefit until you graduate from high school or pass age 18 there. Also, someone who is divorced will follow these same rules already mentioned, but there are additional nuances here that we're going to get to towards the end of this episode. So be sure to stick around if you are divorced and you're wondering, hey, am I entitled survivor benefits?
Jacob:If so, what are the different kind of parameters that I've got to operate within to qualify? So those are the different types of people that are entitled to a survivor benefit, but each of those people will receive a different amount. So here's what each of those different categories are going to receive. And just so you know, I'm gonna skip over what I'm gonna call the normal or most common situation, which is a surviving spouse that has to be over age 60. That's the most common, the broadest category where most people fall.
Jacob:So since that's the most common situation and maybe the most confusing, we're gonna cover that one here in just a moment, since that'll make up the majority of our conversation here today. But we'll go ahead and skip to the surviving spouse who might be disabled and they decide that they wanna take their benefits before 60. As a disabled surviving spouse, you're able to take your benefits at 50 or later. So between ages 50 and 59, if you decide to take your survivor benefits in that age range, you would get 71.5% of your spouse's PIA. For example, if you are surviving spouse and you're disabled, let's call you 55 years old, and your spouse passed away, whatever their PIA would have been, call it, I don't know, 2000, you'd be entitled to 71.5% of their PIA before age 59.
Jacob:Next, if you're a surviving spouse of any age and you're caring for that child who's 16 or younger, you would get 75% of your spouse's PIA. So you're entitled to 75% rather than 71 and a half. So again, it's different for every single type of survivor or person in these different scenarios. And if you're a child that's either age 18 or 19, if you're still in elementary or secondary school, or who might have a disability, you're entitled to 75% of their PIA. So just like the surviving spouse who's actually caring for a 16 year old or younger, it's the same percentage there.
Jacob:And then percentages of the PIA that divorced spouses would be entitled to, they're similar to above, but there are some nuances here that we're going to cover again towards the end of episode here today. So those are the percentages and the amounts that are of the, I guess, the less common situations that you can get as a survivor. Now, let's talk about the most common situation. So as a surviving spouse that is 60 or older, you are entitled to anywhere from 71 and a half percent to 100% of your spouse's benefits. And there are a few different things to know that will determine how much you'll actually get.
Jacob:And this includes things like your deceased spouse's PIA, whether or not your deceased spouse had already filed for their retirement benefits and at what age they did so. Also things like what age your spouse died at and the age in which you actually file for your benefit as a surviving spouse. So that's probably all really confusing. So let's try to simplify this a bit if we can. So let's first assume this, let's assume that you have reached your full retirement age, your FRA, by the time that you file for your survivor benefit.
Jacob:Okay, so you are at FRA, full retirement age or beyond. Now the next assumption is this, let's say that your spouse had not yet filed for their own retirement benefit by the time that they died. If your spouse died prior to their full retirement age, your benefit as a surviving spouse will be whatever your deceased spouse's PIA was, their primary insurance amount. So let's say that you are 68, let's say that your spouse had not filed, but they died at 65, which is before their full retirement age, you would get whatever their full retirement age benefit would have been, their PIA, since you yourself are past your full retirement age, even though they had not filed and they were not yet to their full retirement age. So that's number one.
Jacob:Number two is, if your spouse died after reaching full retirement age, but remember, they still have not filed for their benefits, okay, you would receive whatever they would have received had they filed on their date of death, Okay, so again, let's assume you're 68, so you're past your full retirement age. Now, your spouse passed away, they still had not taken their benefits, but they were also 68. Okay, so they have whatever their PIA was, their full benefit plus some additional benefits because they had not taken it, they've got those extra credits, you would get whatever they would have gotten if they had filed on their date of death. So you get credit for all of their untaken credits so far. So you don't get penalized if they had not taken their benefits just yet, you actually get rewarded in both scenarios, okay, you get whatever they would have gotten if they were past their full retirement age, or you get that increase if they were under their full retirement age.
Jacob:Again, this is all if they had not filed for their own benefits just yet. Now, here's the other side of this. If your spouse had filed for their own benefits by the time they died, then your benefit as a surviving spouse would be the greater of the amount that your deceased spouse was receiving at the time of their death, or 82 and a half percent of your deceased spouse's PIA. So in other words, if your spouse filed so early, so '62 or '63, that they were receiving less than 82 and a half percent of their own PIA, which is completely possible, then you would actually get 82 and a half percent of their PIA, which is an increase compared to what they themselves were receiving. Okay, so as an example, let's assume that your spouse filed for their benefits at 62, so the earliest they could, then they passed away at 63.
Jacob:Their benefit that they were receiving at the time of death would be lower than 82 and a half percent of their PIA. So if you are of your full retirement age or beyond, whenever you start taking your survivor benefits, you would actually get 82 and a half percent of their PIA, not 100% of what they were receiving, because 82 and a half percent in this example, would actually be higher than 100% of whatever they were receiving. So this is a benefit for you that you're not getting a 100% of what they were receiving if they had filed for their own benefits and were receiving less than 82.5% of their own PIA. So if you need to pause and go back through that, completely fine, pause, re listen to it, and make sure that makes sense because there are so many different little things and nuggets and nuances throughout that that probably deserve another listen. So those are the rules if you are at your full retirement age or older whenever you start taking your survivor benefits.
Jacob:Now, what happens if you take your survivor benefits before your own full retirement age? You'll receive a reduced benefit. So specifically, if you file as early as possible, which is age 60, then your benefit as a survivor will be 71.5%, whatever it would have been had you waited until your full retirement age. And each subsequent month after you turn 60, your survivor benefit increases proportionally until you reach your survivor for retirement age. For example, if you file for your survivor benefit halfway through age 60 and then your full retirement age, the amount that you would receive would be about 85 or 86%, about halfway through 71 and a half and a 100% of the amount that you would receive had you just waited until full retirement age.
Jacob:Just know that if you file to begin receiving your survivor benefits between 60 and your full retirement age, you will get anywhere from 71.5% up to 99% of the survivor benefit that you are eligible for at your full retirement age. And this is important because a common assumption that I often hear is that I'm just gonna get 100% of whatever my spouse was receiving whenever they passed away, and that might end up being the case, but just as I explained, it could end up being less than that based on these different factors. So let's walk through an example here and see if these rules make sense more in action. So let's assume that your spouse died at 70 and they were receiving $3,000 a month and you are age 67, which means you're of your full retirement age yourself. This means that you're gonna be entitled to that full benefit, 3,000 a month, which means you're getting a 100% of whatever they're receiving.
Jacob:Now, let's leave everything the same in that scenario, but we're gonna change your age. So you're not 67 anymore, let's just say that you're 60 right now and you want to take your survivor benefits immediately. You would get 71 and a half percent of 3,000, which is 2,140 that's how much you would get by taking your survivor benefits at 60. Now, if you take them at 65, you would get somewhere between 2,100 and 45 and $3,000 a month, and I haven't done the math on that, but you should get the point here by saying, hey, if I delay my survivor benefits, I can actually increase how much I'm going to get. And it's important to remember here that your survivor benefits actually do receive COLAs just like any other Social Security benefit out there.
Jacob:So that's important to know is every time you delay, you're delaying in terms of that 71.5% up to 100% is what you could get, but you're also getting more COLAs on top of that. Now, here's a different scenario. Let's say that you're 65 currently, and your spouse also just passed away at 65, and they were not yet taking their benefits. You would be entitled to a percentage of their PIA, their primary insurance amount, meaning you wouldn't get penalized for them not yet taking their benefits, you would only be penalized if you take your survivor benefits earlier than your full retirement age. Also, if your spouse was 68 and not taking their benefits, you would still get a reduced amount if you were 65 at the time of taking your survivor benefits.
Jacob:So even if they were past their full retirement age, and you start taking survivor benefits before you get to your full retirement age, you would get a reduced amount. But the reduced amount would be based on how much they would have received had they filed on that date of death. So again, you get an increased amount that it would be based on, but you still get reduced off of that. And there might be a chance that the amount that you'd be getting is actually still higher than their PIA because they had delayed taking their benefits past their full retirement age. Now, as I'm going through all this, you might have noticed that I've said, if you take your survivor benefits before your full retirement age, or if you're taking your survivor benefits, and that really begs the question is, well, can I delay my survivor benefits if I want to not receive them or if I wanna wait?
Jacob:And the answer is yes, you can absolutely delay your survivor benefits, you do not have to take them immediately upon your spouse's death. Now, there are a few things that I need to mention here. If you do delay your survivor benefits, that does not mean that you have to delay your own benefits or vice versa. You can actually take your survivor benefits without taking your own benefits. Now, is completely different from spousal benefits because with spousal benefits, as I explained last week in our episode, that there's something called deemed filing whenever you're talking about spousal benefits, it just basically means that in order to qualify for a spousal benefit, you must have filed and be taking your own benefits, and you would get the greater of the two, either your own benefit or your spousal benefit, whichever is greater.
Jacob:So that's critical here when we think about survivor benefits, there's no such thing as a deemed filing with survivor benefits like there is with spousal benefits. So you can think of it that way, you could take your own benefits early and then delay your survivor benefits into the future. You can take your survivor benefits early and delay your own benefits into the future. The key there is if you fall into those different categories of types of people, you can qualify at different times and you would get different benefits based on percentages and when you decide to actually take your survivor benefits. So just know you don't have to take your survivor benefits immediately upon your spouse's death.
Jacob:So let's maybe look at this in an example, just help it make more sense. So let's say that your spouse was taking their benefits whenever they passed away, and they were 68 and you're currently 63. Your own social security benefits, which you're able to file for because you're 62 or older, your own benefits would be about $2,500 per month if you took your own benefits today. But your spouse, they were receiving $3,200 per month at the time of death. So if you started your survivor benefits immediately, you would get a reduced amount because you'd be taking your survivor benefits before your full retirement age.
Jacob:Remember, you're 63. So this isn't exact math here, but your survivor benefit will be somewhere close to $2,500 because of that reduction off of the $3,200 that your spouse was receiving. And since your own benefit at 63 would be $2,500 it might make sense to delay the survivor benefits and actually take your own right now. Now, means you would get about $2,500 a month starting today based on your own benefits, but you could delay your survivor benefits into the future so that you can get the full amount that you are entitled to at that point. And obviously, you'd have to do some math here and play with this and run some numbers.
Jacob:But if you think about it this way and say, hey, there's some optionality here with these survivor benefits and just taking them immediately might not be the best solution because doing something like this and kind splitting between your own benefits and your survivor benefits in terms of the timing in which you decide to take them, it could increase your lifetime, Social Security earnings and benefits total, and it could work out the other way too, to where if you take the survivor benefit now and delay your own benefit until sometime in the future, that could work out better in terms of the total math and total benefits received over time. So that's what I mean by deemed filing. You don't have to take your own benefit in order to get the survivor benefit, they're not attached to each other like spousal benefits are. So that's the answer to the question of do I have to take my survivor benefits immediately? No, you do not have to take your survivor benefits immediately, you can delay those until you get to some point in the future.
Jacob:Now, does not help you to delay them past your full retirement age, okay, so you don't get any extra credits beyond that, or benefit beyond that, once you do so once you do get to your full retirement age, it might make sense to evaluate, hey, should I go ahead and take these and do it that way? Now, another question I get is, can I get my benefits and the survivor benefits on top of Can I get my own benefits plus the survivor benefit? And the answer is no, you can only get one or the other and it's whichever is higher. Now, it's not quite as simple as like just I get one or the other, really what's happening here is if the survivor benefit would be higher than your own benefit, you're going to get your benefit plus the difference between your benefit and whatever their benefit was or whatever you're entitled to. So for example, if a survivor benefit is, you're eligible to $3,000 and your benefit pays you 2,500, you're gonna get your $2,500 benefit, but you're also gonna get the survivor benefit of $500 tacked on top.
Jacob:So it's kinda like it adds it on top, it doesn't necessarily eliminate yours and take that one completely, doesn't really matter because it ends up being the same, but the math behind the scenes is obviously not the easiest or simplest way to get there. Now, another thing to know here is that the earnings income limit applies to survivor benefits, just like it does if you take your own benefits early before full retirement age. I'm not going to dig into this completely, but just know that if you're still working and you're earning an income, your social security benefits could be temporarily reduced if you're earning too much money prior to your full retirement age. And this same rule applies to all Social Security benefits, whether they're your own benefits, a spousal benefit or a survivor benefit. So it's important to pay attention to the earning limits there, and it probably factors into your decision to take survivor benefits if you're still working because you're gonna get reduction in that amount anyway while you're still working and earning income before you get to full retirement age.
Jacob:So that's something that's important to remember. Now let's go back and talk about divorcees and ex spouses and survivor benefits that might be available there. So if you're divorced and you're not remarried, you will simply follow all the rules as if you were married when your ex spouse passed away. Okay, so if you're divorced and you never got remarried, everything that I've explained so far applies to you as if you were still married. Now, if you're divorced and you're remarried, your age at the time of remarriage becomes important.
Jacob:If you remarried before age 60, you're not able to claim any survivor benefits based on your ex spouse. All benefits moving forward will be based on your current spouse. Now, if you remarried after age 60, you are still eligible to receive survivor benefits based on your ex spouse. So that's something that's crucial. So if you're 59, and you're thinking about getting married to someone after you've previously been divorced, and you know that your spouse passed or your ex spouse passed away, based on these rules, it might make sense to delay that marriage until after age 60, okay?
Jacob:Just pay attention to that if you are divorced or have an ex spouse who's passed away, you are eligible in some instances for survivor benefits as an ex spouse, it just depends on if you've been remarried or not, and if you have been remarried, what age you actually got remarried at. Now something over the last few months has taken place here that impacts a decent percentage of people around Social Security, and that's been the repeal of the Windfall Elimination Provision or WEP for short, and the Government Pension Offset or GPO. So those two things have been repealed, meaning if you have pensions or different offsets that were happening in the past, guess what? You're gonna be receiving your full benefits and this applies to spousal benefits, it applies to survivor benefits. Everything is equal across the board now, meaning there's no differences whether you were a government employee or someone who was under these WEP or GPO provisions, and you were having to offset different incomes to not get too much from Social Security, guess what, you are now entitled to survivor benefits, that's something you might want to check on, and you might want to look at because if you were entitled to survivor benefits, you might have an increased amount that you could be entitled to as well if you're not yet receiving that.
Jacob:So I know this has been a lot, it can get really confusing really quickly, and I hope today I made things just a little bit easier around survivor benefits, but I know that it might take a couple times to listen to this. And so I wanted to be able to give you something to help make this more visual for you, because sometimes it's hard to navigate in an audio format. So I've got a flowchart that I like to give you, where it just basically gives you these different scenarios, and it says, if this, then I go to this next step, and so you can trace your way through all these things to come out the other side and say, this is what I can do as a survivor benefit. So if you'd like a copy of that flowchart, just shoot me an email, it should be listed down in the description below. I'll happily send that over to you, it's completely free, and then you can have that for your reference.
Jacob:So thank you so much for tuning into this week's episode. I hope you found it helpful. If you did, please leave a rating and review there on Apple Podcasts or Spotify. It helps other people find the show and I greatly appreciate you doing that. Also share it with a friend if someone else could benefit from some of the things we talked about here today.
Jacob:Other than that, I look forward to talking with you again next time. Hey, it's Jacob again, and I wanted to remind you that nothing discussed in today's episode is meant to be financial, legal or tax advice. Retirement Answers is for educational purposes only. Thanks for tuning into this week's episode. I look forward to talking with you again next week.
Creators and Guests
