Divorce & Money

Dear Liz: I am 87, divorced for 45 years, never remarried. I applied for my 93-year-old former husband’s Social Security support and qualified. I was refused by the local Social Security office. I really don’t understand why. I am a COVID long-hauler and I get confused. I was a stay-at-home mom until my kids were in college, and my husband divorced me. My Social Security is not enough to support me, and I am seriously in debt. I am set up with Social Security to receive my share of my former husband’s Social Security at the time of his death. What am I doing wrong?

Answer: If your former husband is still alive, it’s possible that your current Social Security retirement benefit is larger than any benefit you would have gotten from his work record. Spousal and divorced spousal benefits are limited to 50% of the primary worker’s benefit at full retirement age.

Should he die, you could be eligible for a divorced survivor benefit, which is up to 100% of the amount he was receiving.

Rather than wait, though, you should consider talking to a bankruptcy attorney about your debt. Consider asking one of your kids or a financially savvy friend to come with you and take notes so you understand your options.

Dear Liz: My spouse’s parents were married for 11 years. They divorced at age 32 and my mother-in-law remarried at 42. My mother-in-law and her ex are now 82. Her husband is 93 and in poor health. When her husband dies, she does not get his pension. Her current Social Security benefit is $850 a month. Her husband receives $1,200 while my father-in-law’s benefit is $2,500 a month. She is convinced that when her current husband dies, she will be eligible for her ex-husband’s $2,500 benefit. I think that only happens when her ex dies, but she can get 50% while he is still alive. What is correct?

Answer: You’ve got it right.

People may be eligible for benefits from ex-spouses’ work records if the marriage lasted at least 10 years.

While the ex is alive, your mother-in-law could qualify for divorced spousal benefits of up to 50% of his benefit at full retirement age — but only if she is currently unmarried. If her ex dies, she might be eligible for divorced survivor benefits of up to 100% of the benefit he was receiving — but only if she is widowed or divorced. (People can receive divorced survivor benefits while married, but only if they married at 60 or later.)

She would receive benefits based on her ex’s work record only if the check is larger than her own.

The different rules for divorced spousal versus divorced survivor benefits can be complicated, so it’s not surprising that she’s confused. Let’s use the numbers you provided to make this somewhat clearer.

If she is widowed and her ex is still alive, she would get a divorced survivor benefit of $1,250, because it’s (slightly) larger than the $1,200 survivor benefit from her husband’s record. (Her own $850 benefit would essentially go away, so her household income would drop pretty dramatically from $2,050 plus the pension to $1,250.)

If her ex should subsequently die, she would be eligible for divorced survivor benefits of $2,500 (or whatever the ex was receiving at the time of his death).

There are some caveats here.

Divorced spousal benefits are based on the ex’s “primary insurance amount,” or what he would receive at his full retirement age. For someone born in 1940, that was 65 years and six months. Your mother-in-law would not be eligible for any delayed retirement credits her ex may have earned by putting off his application until after his full retirement age.

On the other hand, she wouldn’t be penalized if he started his benefit before full retirement age. The bottom line is that her divorced spousal benefit could be somewhat more or less than 50% of what he is currently receiving, depending on when he applied.

Survivor and divorced survivor benefits, on the other hand, are based on what someone was actually getting when they died. An early start can stunt those benefits whereas a later start can increase them.

That’s true of regular survivor benefits as well, and why it is so important for the higher earner in a married couple to delay filing as long as possible. The larger benefit can really help when the first spouse dies and one of the couple’s two checks ends.

Your mother-in-law’s financial prospects were made even worse by the decision to get a “single life” payout from the pension rather than a “joint and survivor” option. The joint and survivor option would have meant accepting a smaller benefit, but it would have lasted for your mother-in-law’s lifetime rather than ending at her husband’s death.

A married worker can’t choose the single life option without spousal consent, and spouses would be smart to consult a fee-only financial planner before they agree to give up a lifetime stream of income.

Dear Liz: My son is 59, and his ex-wife died approximately 12 years ago. She was a nurse and paid more into Social Security than he has. Is he entitled to her Social Security benefits as indicated in your article? How does he file and get more information? Must he wait until he is 62?

Answer: If their marriage lasted at least 10 years, he could begin divorced survivor benefits as early as age 60, or age 50 if he is disabled. (He can remarry at age 60 or later and still receive survivor benefits.)

Benefits are reduced if he applies before his full retirement age, which will be 67. Also, starting before full retirement age means the benefits are subject to the earnings test that withholds $1 in benefits for every $2 earned over a certain amount, which in 2023 will be $21,240.

If he earns too much to make starting early worthwhile, he could apply for divorced survivor benefits at age 67, when the earnings test goes away. His own retirement benefit could continue to grow until age 70, and he could switch at that point if his own benefit is larger.

But he’d be smart to consult a financial planner or use a Social Security strategy site, such as Maximize My Social Security or Social Security Solutions, to craft the best approach.

He can call Social Security’s toll free number at (800) 772-1213 for more information.

Dear Liz: I was told by Social Security that because I remarried at 60, I could still collect half of my ex’s benefits once he died. He has just died, and half of his benefit is greater than my own retirement benefit. My current husband has not started benefits. If I collect half of my ex’s benefit but want to later switch to collecting benefits on my current husband’s record (once he starts to collect) or to survivor benefits should he die before I do, can I do that?

Answer: The short answer is yes, although you’ve confused divorced spousal benefits with divorced survivor benefits.

While your ex was alive, you might have been eligible for a divorced spousal benefit if you had remained unmarried. That benefit would have been up to 50% of your ex’s primary insurance amount (the amount he would receive at his full retirement age).

The rules changed once your ex died. As a divorced survivor who remarried after age 60, you are entitled to up to 100% of what your ex was receiving. The survivor benefit will be reduced if you haven’t yet reached your full retirement age (which is currently between age 66 and 67).

Survivor benefits also offer more flexibility to switch later than other types of benefits. If you choose to begin receiving a surviving divorced spouse’s benefit now, you can switch to your own benefit at any point through age 70, if your benefit is higher, says William Meyer, founder of the Social Security Solutions claiming strategies site. You also can switch to receiving spousal benefits from your current spouse’s record once he starts collecting, if that benefit is greater than what you’re receiving from your former spouse’s record.

Figuring out the right way to claim can be tricky, so consider consulting an advisor or using claiming strategy software to determine what’s best in your situation.