Social Security Benefit Facts for Spouses
Losing a spouse is one of the most devastating things that can happen to you. Not only are you missing your partner’s love and company, you may be forced to make difficult financial decisions on your own. You may also find your monthly income significantly reduced and wonder if you will have to sell your home or make significant lifestyle changes.
If you and your spouse are drawing your full benefits from Social Security, but this does not automatically continue if one of you dies. The amount you would receive depends on your age and eligibility. A widow or widower who has reached the full retirement age (which varies according to year of birth) will receive 100% of the deceased spouse’s benefit amount. A widow or widower aged 60 will receive 71½% to 99% of the full benefit amount. A disabled widow or widower aged 50 through 59 will receive 71½%. These amounts are calculated by very complicated rules and you should check with Social Security to get an estimate of your benefits.
It’s unfortunate, but I have counseled with more than one widow/widower who was in a state of panic because of decreased in income. “After the fog lifted (referring to the loss of their beloved) I realized
I was running out of money”.
5 Things Every Woman Should Know About Social Security is a helpful publication for both men and women. It can be found at http://www.ssa.gov/sf/FactSheets/WomenandSSrev1.pdf.
If your own situation indicates that you would be drawing a lower monthly amount than you are receiving now, ask yourself if these benefits are sufficient to cover your financial needs. If not, you may want to look into attaining a reverse mortgage to supplement your Social Security benefits. Even if you do not plan to use the proceeds in the near future, you can get an idea of how a reverse mortgage can help you maintain your standard of living.
Here’s a list of things you should know about preparing for those decisions.
How soon do I have to notify Social Security to tell them of my spouse’s death?
You should notify SSA as soon as possible in order to begin collecting the benefits to which you are entitled. In most cases, the funeral home will report a death to Social Security for you, so be sure that they have the Social Security number of the deceased. You cannot report a death or apply for survivor’s benefits online but you can speak to a Social Security representative between the hours of 7 a.m. and 7 p.m. Monday through Friday. Call 1-800-772-1213.
If you have questions about Social Security benefits, there are numerous publications you can read online at ssa.gov. One that you may find helpful is entitled “How Social Security Can Help You When A Family Member Dies” and can be found at http://www.ssa.gov/pubs/EN-05-10008.pdf.
How do I collect Social Security benefits after the death of my spouse?
Your spouse should be covered by Social Security if he/she worked and paid into the system for 40 quarters or more (10 years). You can check eligibility by calling 800-772-1213.
If your spouse meets the eligibility requirements, you can collect a one-time Death Benefit to cover burial expenses. You may also be eligible for survivor’s benefits if you are 60 or over. Even if you are under 60, you may be eligible to collect survivor’s benefits if you are over 50 and disabled or taking care of disabled or dependent children.
Your eligibility and the amount of your benefits are determined by complicated formulas, so you really need to talk to someone at Social Security to get the information you will have to have in order to proceed with your future financial planning.
When my spouse dies, will his/her pension stop?
If your spouse is receiving a pension, you need to find out ahead of time whether it will continue after his/her death. This is something you should investigate by contacting the payer handling the pension. Find out what the terms of the pension are and what survivor’s benefits can be expected. You may need to choose the survivor option, which can cost more. It may make more sense to roll the pension into an IRA, but this has to be done before you or your spouse begin collecting benefits.
My former husband/wife has died. Can I collect benefits?
In some cases, yes. If your marriage lasted ten years or more and you are at least 60, you can receive benefits from a former spouse. The age for eligibility is 50 if you are disabled. This will not affect the amount of benefits received by the person’s widow/widower and children. These are called “Derivative Benefits.” You should check with Social Security for information about your eligibility and amount of benefits. Having this information can help you see your financial picture more clearly and plan for the future.
Financial advisors recommend postponing important decisions like selling your house or purchasing more insurance until at least six months after your spouse’s death. You’ll need that time to wade through your financial documents and take the reins of running your household by yourself. You also need time to grieve and start thinking clearly.
That’s why it’s important to make plans ahead of time. You and your spouse should sit down calmly and discuss the financial repercussions for each of you if the other should die. Those plans may include applying for a reverse mortgage that will help the survivor remain in the home and pay the bills. If done wisely, a reverse mortgage can help to make up for the income lost when a spouse dies.
If you have a reverse mortgage question, call Angella Conrard at 866-949-7030. I will be happy to answer your questions, be of service, and help you live your most comfortable life!