The Increasing Importance of Social Security Benefits
Social Security is a significant topic in our society today, and it will be increasingly significant as more and more people from the older generations (i.e. Baby Boomers and Gen Xers) retire in the not-too-distant future. One of the biggest issues pertaining to Social Security is simply the issue of how long the Social Security fund can last. Projections vary depending on the source, but certain sources project that the fund may be depleted as early as 2035. But, even if or when the fund becomes depleted, Americans will still be able to draw benefits from Social Security because those who remain in the workforce will continue to fund the system. Of course, a depleted fund may impact how the system operates in certain ways, but the key point is that some benefits will still be available. In other words, Social Security is here to stay, although the details may change at some point in the future.
What many spouses in Colorado do not realize is that the Social Security Administration (SSA) allows for spouses to take benefits which have been accumulated by their spouse. Picture this scenario: one spouse works in the private economy for four decades, while the other spouse stays home for a substantial chunk of time, and then begins working on a part-time basis. When they retire, one of the spouses will obviously be entitled to substantially larger benefit on an individual basis; but, the SSA allows for the other spouse to “share” the benefits which would be due to the other spouse. This is true even if the spouse who worked full-time continuously is still living when the claims are made.
Eligibility Requirements for Spousal Benefits
Naturally, for a spouse to qualify for benefits, certain eligibility requirements must be met. For one, the couple must be legally married minimally for one year; or, if the applicant is a former spouse, the marriage must have lasted at least 10 years prior to the divorce. Next, the applicant’s age must be at least 62. If the applicant is under 62, then the applicant must be a caregiver to someone with a disability or to a child under the age of 16. If the applicant does not meet either of these two requirements, then the amount of the benefit may be reduced.
If both the applicant spouse and the worker spouse have Social Security benefits available, the Social Security Administration will pay the higher of the two potential benefits. When a spouse applies for the benefits of their worker spouse, the maximum benefit possible is 50% of the total amount due to the worker spouse. So, if the worker spouse would receive $2,500 per month, then the maximum possible amount for the other spouse would be $1,250 per month. But, if the spouse applying for the spousal benefit would already be entitled to $1,300 just by his or her own accumulated benefits, then the SSA would simply pay the higher amount.
Importantly, a spouse can still take benefits even if he or she chooses to retire before the age of 62. However, when a spouse retires early in this manner, the benefit amount will be reduced according to a preestablished formula enacted by the SSA. Under the current formulas, the amount for an early retiree may be reduced by as much as 17.5% from the full 50%. So, in other words, depending on exactly when the spouse retires, he or she may only be able to receive 32.5% of the other spouse’s primary insurance benefit.
Documentation / Information Needed to Claim Benefits
When you go to claim benefits, you should be sure to have all the documentation which is needed to make a successful claim. Naturally, the SSA has documentation requirements to ensure that the person making the claim is the correct person. Successful claimants need the following: (1) birth certificate (original or certified copy), or other proof of age documents, such as state census records, hospital records, etc. (2) proof of citizenship (for those born outside the U.S.). (3) tax records from the most recent tax year.
Contact the Drake Law Firm for More Information
If you would like more information on Social Security benefits for spouses in Colorado, spousal entitlements following the death of a spouse, property division in general, or any other family law related topic, contact one of the family law attorneys at the Drake Law Firm today by calling 720-637-2181.