Anne_in_VA
Junior Associate
Joined: Dec 20, 2010 14:09:35 GMT -5
Posts: 5,544
|
Post by Anne_in_VA on May 18, 2011 8:07:58 GMT -5
I know this question has been posed on the boards before, but I can't find the answer.
I have a friend who is the same age as me (64) and has been divorced many years but was married longer than 10 years - she never remarried and her XH was several years older than she was. She's always been a low earner and her SS will be less than she hoped it would be. She lives with one of her kids and is continuing to work and plans to work as long as she can. She raised her two children by herself and got very little CS, so wasn't able to save a lot of money over the years. She currently contributes to her 401K but I don't know how much she has in it, nor do I know if she has any other retirement savings.
I had read somewhere that she could begin collecting on her former H's SS now and then when she reaches full retirement age she can drop the XH's retirement income and claim on her own.
My Q - is that really possible and does the former spouse have to be retired and collecting SS? I thought you could only collect on an Ex's SS, but then you couldn't collect on your own work history. I know she asked SS about collecting her SS and some of her Ex's, but she can't do that.
Anything else I can tell her about this? If she can collect on his SS now and take her own later, would it be better for her to take it now, save it in some type of investment vehicle, and then when she retires, claim SS under her work history so that she's got a cushion from the years she collected under her XH.
|
|
973beachbum
Senior Associate
Politics Admin
Joined: Dec 17, 2010 16:12:13 GMT -5
Posts: 10,501
|
Post by 973beachbum on May 18, 2011 8:14:24 GMT -5
Anne yes she can do it. Here is the part from the SSA "A spouse who has not worked or who has low earnings can be entitled to as much as one-half of the retired worker’s full benefit. If you are eligible for both your own retirement benefits and for benefits as a spouse, we always pay your own benefits first. If your benefits as a spouse are higher than your retirement benefits, you will get a combination of benefits equaling the higher spouse benefit.
If you have reached your full retirement age, and are eligible for a spouse’s or ex-spouse’s benefit and your own retirement benefit, you may choose to receive only spouse’s benefits and continue accruing delayed retirement credits on your own Social Security record. You may then file for benefits at a later date and receive a higher monthly benefit based on the effect of delayed retirement credits.
If you are receiving a pension based on work where you did not pay Social Security taxes, your spouse’s benefit may be reduced. Additional information on pensions from work not covered by Social Security can be found in Pensions from work not covered by Social Security
If spouses want to get Social Security retirement benefits before they reach full retirement age, the amount of the benefit is reduced. The amount of reduction depends on when the person reaches full retirement age."
Your divorced spouse can get benefits on your Social Security record if the marriage lasted at least 10 years. Your divorced spouse must be 62 or older and unmarried.
The amount of benefits he or she gets has no effect on the amount of benefits you or your current spouse can get.
Also, if you and your ex-spouse have been divorced for at least two years and you and your ex-spouse are at least 62, he or she can get benefits even if you are not retired."www.ssa.gov/pubs/10035.html
|
|
Anne_in_VA
Junior Associate
Joined: Dec 20, 2010 14:09:35 GMT -5
Posts: 5,544
|
Post by Anne_in_VA on May 18, 2011 8:28:55 GMT -5
Thanks beachbum! I knew I had seen this but couldn't find it.
She's always struggled financially because she was a SAHM while her children were little at her husband's insistance and when she got divorced it was hard for her to reenter the workforce with a good paying job. Due to low paying jobs while raising her children after the divorce and getting very little CS she doesn't have a lot saved. I think this will really help her out if she can claim on her EX's income for the next few years and if she'll save that money.
|
|
973beachbum
Senior Associate
Politics Admin
Joined: Dec 17, 2010 16:12:13 GMT -5
Posts: 10,501
|
Post by 973beachbum on May 18, 2011 8:49:50 GMT -5
Anne, make sure to tell her that she doesn't even have to talk to or ask him. All she has to do is go down to the local SS office with her Ss card and a copy of her marriage and divorce papers if she has them. If she still has his SS number that might be helpful but even if she doesn't they will find it from their records for her. The SSA will do the rest for her.
This really is a good idea for her. It might really help her overal financial picture. And she can also check and make sure that when she turns 65 or 67 she keeps checking to see what her own benefits would be. If she is still fine working she can just keep deferring her own benefits till she wants to stop working and they will be even larger. May not work but it's a thought.
|
|
Anne_in_VA
Junior Associate
Joined: Dec 20, 2010 14:09:35 GMT -5
Posts: 5,544
|
Post by Anne_in_VA on May 18, 2011 9:02:52 GMT -5
Yes, I did tell her about just going to SS. I don't know if she has a copy of her marriage cert. but I'd bet she still has the divorce decree.
I also told her about giving up part of the SS on his record if she earns over the maximum allowed. I don't know what she earns, but it's probably over that, so while she'll lose some of the benefit, she'll be ahead if she saves whatever she does get. I see where SS says you lose $1 in benefit for every $2 you earn over $14,150, so she'll probably lose something every year until she retires.
We talked earlier today and if it works out, she will save that money for when she retires.
Karma for you for all the info!
|
|
Wisconsin Beth
Distinguished Associate
No, we don't walk away. But when we're holding on to something precious, we run.
Joined: Dec 20, 2010 11:59:36 GMT -5
Posts: 30,626
|
Post by Wisconsin Beth on May 18, 2011 9:58:50 GMT -5
Thanks beachbum! I knew I had seen this but couldn't find it. She's always struggled financially because she was a SAHM while her children were little at her husband's insistance and when she got divorced it was hard for her to reenter the workforce with a good paying job. Due to low paying jobs while raising her children after the divorce and getting very little CS she doesn't have a lot saved. I think this will really help her out if she can claim on her EX's income for the next few years and if she'll save that money. Wait, does this mean the deadbeat parents who work under the table to avoid their CS can claim their ex's SS at retirement age? Because that seems so unfair and I'm totally willing to let the deadbeats live on 'cat food' and in a box...
|
|
973beachbum
Senior Associate
Politics Admin
Joined: Dec 17, 2010 16:12:13 GMT -5
Posts: 10,501
|
Post by 973beachbum on May 18, 2011 10:07:48 GMT -5
Thanks beachbum! I knew I had seen this but couldn't find it. She's always struggled financially because she was a SAHM while her children were little at her husband's insistance and when she got divorced it was hard for her to reenter the workforce with a good paying job. Due to low paying jobs while raising her children after the divorce and getting very little CS she doesn't have a lot saved. I think this will really help her out if she can claim on her EX's income for the next few years and if she'll save that money. Wait, does this mean the deadbeat parents who work under the table to avoid their CS can claim their ex's SS at retirement age? Because that seems so unfair and I'm totally willing to let the deadbeats live on 'cat food' and in a box... Yes it does. It does have a limit. I think it is half of the spouse's SS so it may not even be more than what they did earn over the table. Most people do have the 10 years of work in their lifetime even if it is not much. This is particularly good for a woman like this that want's to collect the ex's SS for 3-7 years and then swtich to collecting hers. Think of her getting something back from the deadbeat ex. ;D "•If full retirement age is 65, a spouse can get 37.5 percent of the worker’s unreduced benefit at age 62;
•If full retirement age is 66, a spouse can get 35 percent of the worker’s unreduced benefit at age 62;
•If full retirement age is 67, a spouse can get 32.5 percent of the worker’s unreduced benefit at age 62.
The amount of the benefit increases at later ages up to the maximum of 50 percent at full retirement age. If full retirement age is other than those shown here the amount of the benefit will fall between 32.5 percent and 37.5 percent at age 62."
|
|
Wisconsin Beth
Distinguished Associate
No, we don't walk away. But when we're holding on to something precious, we run.
Joined: Dec 20, 2010 11:59:36 GMT -5
Posts: 30,626
|
Post by Wisconsin Beth on May 18, 2011 11:06:43 GMT -5
Wait, does this mean the deadbeat parents who work under the table to avoid their CS can claim their ex's SS at retirement age? Because that seems so unfair and I'm totally willing to let the deadbeats live on 'cat food' and in a box... Yes it does. It does have a limit. I think it is half of the spouse's SS so it may not even be more than what they did earn over the table. Most people do have the 10 years of work in their lifetime even if it is not much. This is particularly good for a woman like this that want's to collect the ex's SS for 3-7 years and then swtich to collecting hers. Think of her getting something back from the deadbeat ex. ;D "•If full retirement age is 65, a spouse can get 37.5 percent of the worker’s unreduced benefit at age 62;
•If full retirement age is 66, a spouse can get 35 percent of the worker’s unreduced benefit at age 62;
•If full retirement age is 67, a spouse can get 32.5 percent of the worker’s unreduced benefit at age 62.
The amount of the benefit increases at later ages up to the maximum of 50 percent at full retirement age. If full retirement age is other than those shown here the amount of the benefit will fall between 32.5 percent and 37.5 percent at age 62." I'm thinking the non-CS paying, non-working deadbeat ex is going to be using the working, custodial SS numbers because they're better than their own. So in effect, the "good" ex is getting used by the deadbeat again. If that makes sense without pronouns...
|
|
NastyWoman
Senior Associate
Joined: Dec 24, 2010 20:50:37 GMT -5
Posts: 14,829
|
Post by NastyWoman on May 18, 2011 14:34:23 GMT -5
Thanks beachbum! I knew I had seen this but couldn't find it. She's always struggled financially because she was a SAHM while her children were little at her husband's insistance and when she got divorced it was hard for her to reenter the workforce with a good paying job. Due to low paying jobs while raising her children after the divorce and getting very little CS she doesn't have a lot saved. I think this will really help her out if she can claim on her EX's income for the next few years and if she'll save that money. Wait, does this mean the deadbeat parents who work under the table to avoid their CS can claim their ex's SS at retirement age? Because that seems so unfair and I'm totally willing to let the deadbeats live on 'cat food' and in a box... So, in the case of Anne's friend (AF)- if she had earned high wages after the divorce, but had no work history before that time, would her XH still be able to get up to half of AFs SS? Please say it ain't so, because that just makes me
|
|
Wisconsin Beth
Distinguished Associate
No, we don't walk away. But when we're holding on to something precious, we run.
Joined: Dec 20, 2010 11:59:36 GMT -5
Posts: 30,626
|
Post by Wisconsin Beth on May 18, 2011 14:50:45 GMT -5
Wait, does this mean the deadbeat parents who work under the table to avoid their CS can claim their ex's SS at retirement age? Because that seems so unfair and I'm totally willing to let the deadbeats live on 'cat food' and in a box... So, in the case of Anne's friend (AF)- if she had earned high wages after the divorce, but had no work history before that time, would her XH still be able to get up to half of AFs SS? Please say it ain't so, because that just makes me That's what I'm thinking is so.
|
|
Anne_in_VA
Junior Associate
Joined: Dec 20, 2010 14:09:35 GMT -5
Posts: 5,544
|
Post by Anne_in_VA on May 18, 2011 15:38:55 GMT -5
Her Ex actually made lots more money than she ever did and he's already collecting SS so he can't claim under her since she was the lower earner and he would only get a % of what she would get. He worked full time for many years as a policeman and then retired and started a second career doing something else. He's almost 70 now and still works part time (I think that's what she told me a few weeks ago).
If you look at it from a purely financial perspective and assuming she doesn't make anywhere near what I do, then she'll make out pretty well by collecting any percentage of his SS now and then taking hers when she retires fully.
Also, don't forget that SS will reduce any benefit you receive in any year you earn over a set amount - in her case $14,160. That means for every $2 she earns over that amount, SS reduces her benefit from her Ex by $1.
Somebody correct my math if I'm wrong on the calculations on this next part, math isn't my best subject.
So if she earns - say $25K and her Ex gets $2K per month from SS - she would then qualify for a percentage of that, say 35% or $700 per month For every $2 she earns over $14,160, SS will reduce her benefit by $1. So, SS would reduce her monthly amount by $451.67 and she would then get $248.33 since she earned 10,840 more than the maximum of $14,160.
Even if she only saved the $248 every month, in 5 years that would give her almost $15K (not including any interest or other growth if put in investments).
|
|