Contrary to popular belief, when your spouse passes away, Social Security survivor benefits are NOT paid to you automatically.
Like all other types of Social Security benefits, you have to proactively apply for survivor benefits, which means that you have to know that you’re eligible and you have to know exactly when to apply.
In order to be eligible for benefits as a survivor, you must have been married to the deceased for at least 9 months before their death and must be at least 60 years old.
Depending on your age and other factors, survivors are entitled to the highest benefit that was being received by the couple. So for instance, if John was receiving $2,000 per month and passed away at 75, his wife Mary who is now 70 could receive the full $2,000 that John was receiving and her lower $1,000 benefit on her own record would stop.
If you’re a survivor under age 70, in most cases you will be entitled on two records; your own and as survivor based on your spouse’s record. Which record you should take benefits on and when you should take it is crucial to your long-term fiscal health.
You have the ability to claim only one of the two benefits available to you and you can then claim the other benefit at a later time by using something called a Restricted Application. By doing so, the unclaimed benefit will continue to accrue Delayed Retirement Credits.
If you’re over the age of 70 and are eligible for a survivor benefit, but have not yet claimed it you should do so as soon as possible. Because with each month that passes you are leaving money on the table given that Delayed Retirement credits stop accumulating at age 70.
Survivors who are past their Full Retirement Age (66 in most cases) are also eligible to receive up to six months of retroactive survivor benefits. Clients we work with are often surprised by this and receive an extra $10k to $15k as an initial lump sum by properly requesting and taking advantage of this retroactive benefit.
Again, though this does not happen automatically and has to be specifically requested at the time of application. Taking benefits even a month or two off your optimal time frame can result in significant losses over time.
The Bottom Line: Properly coordinating and timing benefits is critical for everyone who needs to claim Social Security. The importance of pursuing strategies that maximize spousal benefits and increase delayed retirement credits, without guidance and understanding can cost you a lot of money in the end. To schedule a consultation with an advisor to make sure you’re maximizing your survivor benefit click here.
Until next time,
Matthew Allen is the Co-Founder/CEO of Social Security Advisors and creator of the new course Maximizing Your Social Security produced in conjunction with Weiss Educational Services. Matthew has helped thousands of seniors maximize their Social Security benefits and avoid costly mistakes when filing. Matthew has been at the forefront of financial services for over a decade. In addition to co-founding Social Security Advisors, Matthew also founded The Universal Group of Companies, a private investment firm, in 2004. From 2000 to 2004, Matthew was a NYSE Market Maker with LaBranche & Co., a Fortune 500 New York Stock Exchange firm.