HOW DOES DIVORCE AFFECT SOCIAL SECURITY BENEFITS?

We work throughout our entire adult lives and, during that time, most of us are required to pay into the Social Security System. The payoff comes when we hit retirement age and are able to start receiving Social Security benefits. But what happens when a person gets divorced? “How will the divorce affect my Social Security?” “Do I lose half of my benefits?” “Am I entitled to my husband’s social security?”  These are questions I frequently hear from my clients.

The answer is that you do not lose half of your Social Security when you divorce — but after that, the matter can get complicated. If you are widowed, then you may be entitled to social security payments as a survivor spouse. If you are divorced (not widowed), and you are of retirement age, then you could be entitled to spousal benefits, or to your own benefits. If you had multiple marriages, then you might have to choose between several different options.

I recently came across a Los Angeles Times article that sheds some light on the subject. In the March 2011 article, entitled “Divorce can complicate Social Security claims; Knowing the rules involving spousal and survivor benefits can prevent costly errors,” author Kathy M. Kristof makes the following points:

“If you were married for at least 10 years to someone who paid into the Social Security system, you are entitled to a spousal benefit, even if you are divorced from that person.  Eligibility does not depend on whether or not you also worked and paid into the system.”

“Spousal benefits, if claimed at your full retirement age, usually amount to 50% of the wage earner’s full benefit. If you claim benefits early, the amount you get is reduced.”

“If you worked for 10 years and paid into the Social Security system, you also may be entitled to benefits on your own work record. In that case, you must choose — you cannot claim both your own and spousal benefits. You can, however, claim the one that gives you the most money.”

“If you remarry before age 60, you lose your ability to claim spousal or survivor benefits based on a former spouse . . . If you remarry after age 60, all of your rights to spousal and survivor benefits based on your former spouse’s record are retained for your lifetime.” 

“If you are single now but were married to more than one person for more than 10 years each, you may be eligible for spousal benefits based on the earnings records of each of those former spouses . .  You don’t get to add up all the benefits, of course, but you do get to choose the benefit that’s best. So, if one spouse was an executive with maximum Social Security earnings, the next spouse was a low-wage earner, and the third worked in a job that didn’t earn Social Security credits, you can claim the benefit from the first spouse, which is likely to amount to the most money.”

“But what if spouse No. 2 died before you claimed Social Security benefits? Then you would be entitled to spousal benefits on spouse No. 1 or survivor benefits on spouse No. 2.  Because survivor benefits are 100% of the working person’s entitlement and spousal benefits are just 50%, the survivor benefits may be more generous, even if spouse No. 2 didn’t earn as much. You can claim the one that pays the most.”

Social Security is an important part of your long-term planning for retirement. In the event of a divorce, you are given choices, but those choices aren’t always easy. Having the assistance of a legal counselor and/or a financial expert can go a long way in helping you to properly plan for your future.

Gary Frank is a Family Law Attorney with over 30 years of experience in handling the division of property, retirement assets, and all other matters arising out of divorce and/or legal separation. If you are in need of a consultation, please do not hesitate to give us a call at 602-922-9989, or through our website at /.