National “my Social Security Week is taking place July 19 – 25, 2015. This is a great time to become familiar with your Social Security benefits. Social Security is an important source of retirement income, especially for women. According to the Social Security Administration, women represent 57 percent of all Social Security beneficiaries age 62 and older and approximately 68 percent of all beneficiaries age 85 and older.
Two of the most common life events that can impact your Social Security benefit are divorce and widowhood; both experiences are emotional as well as unexpected, and they often have a huge effect on a woman’s financial life. Understanding how your Social Security benefits will change and planning ahead can help you or others you know to better navigate these difficult situations.
Social Security & Divorce
Although more women are participating in the workforce, the wage gap and years women spend as unpaid caregivers means that women often earn benefits that are lower than their husband’s or ex-husband’s benefits. When you decide to apply for retirement benefits, the Social Security Administration will calculate the benefits for which you are eligible—your own as a worker, yours as a spouse or ex-spouse (or widow or ex-widow).
The good news is that a divorced woman can apply to receive Social Security divorced spousal benefits without filing any special papers at the time of divorce, and it doesn’t matter if her ex-husband has remarried. What does matter is if you were married to your ex for at least ten years and are currently unmarried. If you remarry, you generally cannot collect benefits on your former spouse’s record unless your later marriage ends, either by death, divorce or annulment.
If you meet these requirements, you can collect a benefit up to 50% of your ex-spouse’s Social Security benefit. (Of course, there is an exception if you remarry after age 60; in that case you can still claim a divorced spousal benefit if you meet the other requirements.) Finally, if your ex is deceased and you are unmarried, you can collect survivor’s benefits, which would be 100% of your ex-spouse’s Social Security benefit.
Social Security & Widowhood
Widowhood is an experience that many of us do not like to think about, but for most married women, it is highly likely that they will become widows one day. Women are four times more likely than men to outlive their spouses, and 85% of women over the age of 85 are widows[i].
Widows depend on Social Security for a larger percentage of their total income. For 20% of women over age 80, Social Security is their sole source of income[ii]. If you are the widow or widower of a person who was eligible for Social Security benefits, you can receive survivors benefits at your full retirement age or reduced benefits as early as age 60. You can also begin receiving benefits as early as age 50 if you are disabled and the disability started before or within seven years of the worker’s death.
For younger widows, you can receive a survivors benefit at any age if you take care of the deceased worker’s child who is under age 16 or is disabled and receives benefits on the worker’s record. Similar to a divorced spouse, if you remarry after you reach age 60 (age 50 if disabled), your remarriage will not affect your eligibility for survivors benefits.
An important fact to keep in mind, too, is that each individual can only receive one Social Security benefit. If both you and your spouse receive a Social Security benefit each month and your spouse dies, you can continue to receive whichever benefit is higher, but not both! This could cause a reduction in total household income after a spouse dies, despite the fact that living expenses often remain the same.
WISER has additional information and resources available at www.wiserwomen.org, including a feature article, Making the Most of Social Security Retirement Benefits if You’re Divorced. WISER also encourages everyone to set up an online account through “my Social Security” on the Social Security Administration’s website. You can use this account to access your online Social Security statement, keep track of your earnings and verify them every year, get an estimate of your future benefits if you are still working, and get details about benefits for your spouse and dependents’ if you die. You can also get an estimate of your disability benefits if you were to become disabled.
Setting up an online Social Security account is easy and takes only a few minutes, so do it today! It’s a great way to celebrate National my Social Security Week and get to know your benefits.
This blog is part of an ongoing series for the “Campaign for a Secure Retirement: Helping Millions of Americans Plan and Save for Retirement;” the Campaign is a joint educational retirement campaign to encourage retirement planning and saving and to promote the online Social Security Statement, available through my Social Security, as an important retirement planning tool.
[i] Society of Actuaries & WISER, Impact of Retirement Risk on Women, 2014.
[ii] Government Accountability Office (GAO), Women’s Retirement Security report, July 2012.