5 Social Security Tips Divorcees Should Know

By Jeremy Reif, CRPS^®, Financial Advisor and Owner of Point Wealth Management

As wonderful as marriage can be, there’s no denying the fact that around 50% of marriages in the United States end in divorce.^[1] Your life may change drastically after a divorce, but one thing many people don’t realize is that divorce can also affect your Social Security and Retirement outlook. In general, the longer you were married holds more weight in the government’s eyes, with ten years being the magic number. So if you were married more than ten years before your divorce, here are five Social Security facts that you should keep in mind in order to make the best decisions for your retirement finances.

1. You Are Still Eligible For A Spousal Benefit

To qualify, your marriage must have lasted at least ten years, you must have been divorced at least two years, and the dependent spouse cannot have remarried. If you want to explore the option of taking a spousal benefit instead of your own, you must be at least 62 and your benefit must not be higher than your ex-spouse’s.

2. Some Documents Are Not Binding

Many times, in the heat of the moment, divorcees sign documents just to close the door and move on from an unpleasant situation. Some attorneys will draft a clause stating that the divorcee in question surrenders their rights to their ex-spouse’s Social Security benefits. However, if you meet the qualifications listed number 1, this divorce decree is not enforceable. If you signed away your rights and now regret it, you can still access your ex-spouse’s benefits.

3. Your Claiming Strategy Doesn’t Affect Your Ex-Spouse

Many people don’t realize that their ex-spouse’s claiming strategy has no bearing on their benefits. Payments made to a divorced spouse on their ex-spouse’s record do not reduce payments for the ex-spouse or their new spouse if they have remarried. Please note, that this is entirely different than if the divorce decree states that part of one’s Social Security benefits must be paid to the ex-spouse.

4. Widow Benefits Are Worth Looking Into

Most divorced spouses can collect their own Social Security while their ex-spouse is alive, but can then apply for a higher widow benefit when the ex-spouse dies. That does not necessarily mean that the deceased ex-spouse’s benefit will be higher than your own, but it’s an option to explore if you find yourself in this situation.

5.  Payment Rules Don’t Change

A good rule of thumb to remember is that the same payment rules apply to divorced spouses and widows as to current spouses and widows, as long as you meet requirement number 1.

Create Your Social Security Claiming Strategy

Planning for retirement can be complicated. Adding a divorce or death to the situation can only make things more complicated. At Point Wealth Management, we can help you calculate your potential benefits and determine strategies to make sure you receive the benefits to which you are entitled. If you’re ready to take this step, schedule a call and meet me virtually.

Point Wealth, LLC is not affiliated with or endorsed by the Social Security Administration or any government agency.

^[1] https://www.mckinleyirvin.com/Family-Law-Blog/2012/October/32-Shocking-Divorce-Statistics.aspx

Originally Published on https://pointwealthmanagement.com/blog/

Jeremy Reif CRPS®

Just like the majority of you, family is where it matters most. For me, it all started when I was young. Like many, my parents played a large role in who I am today. I was fortunate enough to have a family that tried to teach me about the world of finances. This is where I feel that the public school systems tend to fail our society; rather than make mistakes with money and try to learn from the mistakes, I was able to avoid them. I was and still am enamored with finances and economics. Maybe it is a Midwest type of thing, as I am passionate about helping others succeed with their own finances. I hope you find my articles and videos as helpful as my clients have.