Just check, check and recheck what SS does. They DO make mistakes. I’m still waiting for a correction from 2015. I was collecting and worked, and was paid more than I could earn without paying back. It’s a long story…but I paid them, and then they refunded the money I paid back to me. I know I owe them the $2010 I sent them (that’s my total annual SS benefit). They sent it to their auditors in 2016. No I’m not making this up.
I keep waiting for a bill or something from them about this issue…but nada.
Does anyone know, if the higher earning spouse defers beyond FRA, does the survivor benefit get calculated on the FRA amount or the larger amount, say age 70?
I have read it both ways on forums, that the survivor would the amount based on age 70, if the higher earner waited, or that the survivor only ever gets the FRA amount, even if the higher earner waited and received a larger amount him/herself.
@somemom, I’m not an expert, but my understanding is that as long as the surviving spouse has reached their own FRA, they would get the full amount that the higher earner was getting by delaying filing until after their FRA, up to age 70. That’s what I’m counting on. I’m planning not to file until I’m 70, to maximize my monthly benefit. I’ll be working until then anyway, and at 70 and 1/2 I’ll need to start taking RMDs from my retirement accounts, so it’s a good time to retire. By then DW will be close to her FRA. Her SS benefit will be lower than mine. One of the main reasons I’m waiting until 70 is that if she survives me, I’d be maximizing her lifetime SS earnings as well. If I’m mistaken about this, I’d like to hear it.
If husband waits until age 70 to start receiving benefits, and then dies, I think it is pretty clear that widow receives same amount he was getting. What is not clear to me is what happens if husband is planning to wait until age 70 but dies at age 69, or 68, or 67…
Interesting point. Does the survivor get nothing since the deceased wasn’t getting anything? Or would the survivor have to take the survivor benefits and pay out will be based on the age of deceased at the time of death. Can the survivor postpone it until the deceased would turn 70?
That is correct. Spousal and survivor benefits are different. Spousal is one-half of the spouse’s FRA, and survivor is one-half of the decedent’s then-current benefit, so survivor benefits become highest if the spouse waits until 70 to collect SSA.
Note that statistically, second to die probability is much lower than first-to-die (doh!); SS calculations are based on the latter, as the first is ignored. My point is that the odds are pretty good that one of a couple will make it to age 90 (and that is usually the female). As SS mortality calculations are based only on a single individual, as are the discounts for taking prior to FRA and for waiting beyond FRA, married couple can potentially gain more $$ by waiting. (assumes healthy at FRA and no reduction in benefits in 2035)
In response to igloo’s q: If a spouse dies before starting to collect, the surviving spouse is entitled to survivor benefits that are calculated on how much the now-dead spouse would receive that month (should they have just filed). So, if spouse dies at 69.99 years, then survivor is eligible for survivor benefits as of age ~70, not FRA. OTOH, if spouse dies before FRA, then survivor benefit is based on a discounted amount.
@bluebayou explained that well. I just watched a 45 minute on demand videocast from Fidelity on Social Security yesterday and that is exactly what I learned. They explained clearly that surviving spouse benefits (whether for spouse or ex-spouse) are designed to have the survivor walk into the shoes of the deceased. I believe they said the only time that wouldn’t happen is if the survivor can receive a higher benefit on their own.
Seriously, it’s a travesty that the rules for SS are so confusing. I think the folks posting here are probably more savvy than many, and we are confused. How can this be okay? (Rhetorical question, of course.)
I think I’ve got it:
Higher earner waits until age 70, receives maximum benefit; if spouse is claiming the spousal benefit, it’s 1/2 the FRA benefit (If taken at the spouses FRA age)
HIgher earner waited until age 70, then died, survivor spouse gets the full spousal amount, the age 70 amount, not the FRA amount.
If a family feels one of the two will be long lived, it seems smart to wait to age 70.
Technically, the survivor continues to receive his/her own benefit AND the difference between his/her own and the higher earner’s aged 70 benefits. In your survivor hypo, the net effect is the highest earner’s benefit taken at age 70. (It just comes in two $$ parts in SS lingo.)
That’s my plan. I’ve already reached my FRA, but I’m planning to continue to work part-time until I’m 70, health permitting, and not take SS benefits until then. I’m the higher earner. DW is 5 years younger, healthier, female, and has great longevity genes—her mother lived to 99, and her maternal grandmother to 97. So while nothing is certain, it seems likely she’ll outlive me, possibly by 20 years, during which she’ll get my higher SS benefit.
Here is what I know about widow benefit:
My H passed away before FRA, but while on Social Security Disability. I basically received a monthly amount equal to what his disability monthly check was (but without the Medicare deduction). I believe I receive the full amount because I am over 62, but not claiming my Social Security benefit yet (I had the higher amount). I am going to wait until 70 and then switch to my higher benefit.
BUT, and this is a big BUT, there is an earning limitation on that benefit until I reach FRA. This is where I had earlier questions… how in the world do I report my income to SS that is over the earnings threshold? Lo and behold, just today I received a form in the mail from Social Security to fill out to report income from 2018 (as if they cannot see it on the tax return???). But the form doesn’t make any sense.
If you are a regular wage earner you enter amount earned in a monthly box FOR MONTHS WHERE YOU DID NOT EARN $1,420 (the threshold). How do you they know how much you went over the threshold in the other months???
Even more mysterious, if you are Self Employed you fill out another part of the form. You enter the amount of Hours Worked into each month. How in the world do they know how much you are being paid per hour? $10/hour??? $50/hour??? $100/hour??? How in the world do they calculate how much to withhold out of future Social Security payments? The calculation is that I lose $1 for every $2 earned above $17,140 (or something similar to that). It’s just weird.
I’ll report back how they handle this if I ever receive a letter telling me that I ‘owe’ Social Security X dollars. I don’t understand why they just don’t withhold a couple months of the payments.
So I thought I’d come back and do an update for this thread for others like me. I have my credit frozen and I believe somewhere in this thread it was mentioned you have to go to your local ss office and get a one time code so you can set up your social security account online.
Well I did that today! No problems! I wasn’t sure what all I needed to take so I took bc, ss card, passport, utility bill; but none of that was needed all they did was look at my drivers license and ask my ss# and they printed out a paper with a code for me to come home and log on with to create an account. Easy peasy and now it’s done. Oh I didn’t unfreeze my credit either, left it froze, but now my ssa account is open.