Survivor Benefits: 8 Questions

Submitted by Jim Blankenship on Monday, October 27, 2014 - 12:00pm
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Social Security survivor’s benefits become available when a Social Security recipient dies and leaves surviving dependents: a spouse, children and other dependent family members. For many, the benefits constitute a transfusion to diminished household budgets at a tough period of life. The devil’s in the details of these benefits, though, and here are some answers you and yours need ahead of time.

Q: What survivor benefits are available to my spouse?

If your spouse is at least age 60 (50 if disabled), he or she may qualify for a survivor benefit based on your benefit at death. Calculating the benefit factors in the age of your surviving spouse, the benefit status of the deceased spouse and when, if applicable, the deceased’s benefits began.

If your surviving spouse is at the Full Retirement Age (FRA) of 67 for anyone born after 1960, he or she receives 100% of the benefit you got at the time of your death. The minimum benefit is 71.5% of your primary insurance amount (PIA), the amount one receives when filing for benefits at FRA.

If your surviving spouse is younger than 60 and not disabled, the survivor benefit (75% of your PIA) becomes available only if your spouse cares for at least one child or dependent of yours younger than 16.

Q: What survivor benefits are available to my other dependents?

Survivor benefits are available to minor children if you, the parent or legal guardian, die while holding at least 40 quarters of coverage (a quarter being three months of the year when you made, for this year’s regulations, at least $1,200). For a child under 18, or age 19 for a full-time student, the benefit equals 75% of your PIA. If the child is disabled prior to age 22, this benefit last the child’s lifetime.

Parents, grandparents or other dependents to whom you provided 50% or more support also get your 75% benefit.

Q: What survivor benefits can I receive when my ex-husband dies?

If your marriage lasted for at least 10 years and you never remarried, you qualify for the same benefits as if you were married to your ex-husband when he died. In other words, you receive all the survivor’s benefits he was entitled to. As long as you are 60 or older, you file for benefits based on your late ex-spouse’s record.

Q: Are there any limits to the benefits paid on an individual decedent’s record?

Family Maximum benefit (FMax) ranges from 150% to 180% of the primary number holder’s PIA. If the total benefits paying on an individual record exceeds the FMax, all benefits are reduced pro rata to the maximum. Survivor benefits paid to an ex-spouse of the deceased do not count toward the FMax limit.

Q: Are there any restrictions for a surviving spouse to receive survivor benefits?

If you are a surviving spouse who remarries before turning 60, you’re ineligible for survivor benefits from your deceased spouse. If you subsequently end your next marriage or your subsequent spouse dies (meaning you’re no longer married), survivor benefits once again become available to you. The same restriction applies to your ex-spouse.

Q: Does receiving a survivor benefit affect my own retirement benefit? I am 60 and will qualify for a larger benefit based on my own record when I reach FRA.

As long as you are or will be eligible for the benefits, you can take either the survivor benefit first and switch to your own benefit later or vice versa. Filing for a survivor benefit early has no impact on your later retirement benefit; filing early for a retirement benefit also has no effect on your future survivor benefits.

Q: Are there earnings limits on survivor benefits?

As with other benefits, if you earn more than the annual limit in any year before you reach FRA, Social Security withholds $1 for every $2 over the limit ($15,480 in 2014). During the year that you will reach FRA, the limit increases to $41,400 and withheld benefits drop to $1 out of every $3 over the limit. These withheld funds are credited back to you once you reach FRA.

These limits apply to any survivor benefits, whether to a spouse, dependents or ex-spouse.

Q: Are any benefits available if my late spouse lacked enough quarters of coverage?

For you, the surviving spouse caring for a child who’s younger than 16, reduced benefits are available if your deceased spouse earned at least six quarters of credit in the three years prior to death. Any number of quarters between the minimum of six and the maximum of 40 allows for a phased increase in the benefit amount.

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Jim Blankenship, CFP, EA, is an independent, fee-only financial planner at Blankenship Financial Planning in New Berlin, Ill. He is the author of An IRA Owner’s Manual and A Social Security Owner’s Manual. His blog is Getting Your Financial Ducks in a Row, where he writes regularly about taxes, retirement savings and Social Security.

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