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Social Security Filing Strategies for Divorcees

There’s no easy way to say it: getting a divorce is terrible. Not only is there the emotional toll that you have to deal with; a divorce also brings with it a measure of financial stress as well. Instead of living on multiple incomes and sharing expenses, you are now forced to make – and pay for – everything on your own, making all financial decisions along the way. social security filing strategies for divorcees

This burden doesn’t get any easier as you approach your retirement years either. A reduced income can make it harder for a single individual to live and thrive during what are supposed to be the golden years of life. Thankfully, there are programs out there that can provide some measure of help, and Social Security is one of them. 

As a divorcee, you are eligible to receive Social Security benefits based on the working and earnings record of your ex-spouse. However, how much Social Security you can collect really depends on a number of factors, and knowing these factors before you file for anything is crucial to making sure you get the most of what you are entitled to.

And do you want even more good news? Whether or not you collect – and how much you collect – will not impact your ex-spouse or his/her finances at all.

The "Social Security Elephant" in the Room: When, Why, and How Should You File for Social Security? Check out our free step-by-step guide!

Basic Requirements for Divorcees

The great news about this is that the Social Security Administration has guidelines in place that allow one half of a divorced couple to file for Social Security benefits based on the record and history of the other person. This can let you potentially bring in more than you would have been able to on your work history alone. 

This is important because it means that those who stayed home and did not work enough to earn credits, or those who might not have earned as much as their ex-spouse, can still bring in a higher amount of Social Security every month. Of course, there are some criteria that have to be met. Thankfully, there aren’t that many

This first, and most important, is that you have to have been married to your spouse for at least 10 years before getting divorced. The SSA will not grant benefits to any divorcee from a marriage that did not last as least as long as this. 

The second basic rule is that you, as the one filing the claim, can not have remarried. To apply for divorcee benefits, you must currently be single. However, if you remarry, and then divorce that person after only a short time, there are situations where you could be eligible to receive benefits from your first marriage. 

The good news, though, is that your ex-spouse’s marital status does not matter. So even though you have to be single to apply for divorce benefits, if your ex-spouse gets married again it will not affect you or your eligibility at all.

If you meet those basic requirements, and you are in a situation where your ex-spouse’s Social Security benefits are going to be higher than yours, then the good news is that you are eligible to receive those benefits! 

Many of the Rules Are Still the Same

Just like collecting “regular” Social Security, your current age at the time of filing plays a large role in determining how much money you can get.

First, you must be at least 62. This is the minimum age at which anyone can collect Social Security, regardless of their marital status (there are a handful of exceptions here based on things like disability). And, just like regular Social Security, the age at which you file can greatly impact how much you are able to collect every month. 

Did you know that the majority of Social Security claimants fail to make the optimal claiming decision? Discover when, why, and how to maximize your benefits in this free guide

“Full” retirement is age 66 or 67, depending on when you were born, and filing before that means you will receive less per month – by as much as six or seven percent per year! Filing after the full retirement age also changes your benefit amount, going up each year by several percentage points until you reach the age of 70. There are no more increases after age 70, which means there’s no reason to wait any longer to file. 

How Your Age Affects the Process

Now that we’ve talked about the requirements, there is actually one other important piece of information to note: your age. Although your age will not determine your eligibility in getting divorced benefits in the first place – as long as you are old enough to claim benefits – a recent change in federal law has made it play a central role in determining one important thing.

In this case, the cutoff date is January 1, 1954. Whether or not you were born before or after this date will affect whether or not you are able to switch between benefits as you get older. Let us explain:

For Those Born on or Before January 1, 1954

For those born on or before January 1, 1954, you actually have the ability to switch benefits from your ex-spouse’s to yours at some point, if your benefits eventually grow to be larger. What does that mean? Well, imagine this scenario:

You are divorced. You are 66, but your ex-spouse is 70 and, due to age and work history, has better potential SS benefits than you do at this time. For those born before this cutoff date, you are allowed to file for divorcee benefits based on the fact that your ex-spouse has reached the maximum benefit age. You will receive this higher amount – without impacting your ex-spouse’s ability to file or receive benefits at all

Imagine that in this scenario, your own benefits grow each year until you yourself reach 70, and at this point your own SS benefits would be greater than those you have been collecting from your ex-spouse. You are able to make a one-time switch to jump from one benefit to the other, whichever is higher.

For Those Born After January 1, 1954

For those born after January 1, 1954, this option to switch no longer applies. A recent rule (passed in late 2019) has effectively stopped this option. While you still can apply for your ex-spouse’s benefits if they are higher than yours, you can not switch. 

What this means, then, is that when you decide to apply for benefits, you basically “freeze” your benefits at that time. So, if your benefits are higher, you will receive those benefits. If your ex-spouse’s benefits are higher, you may receive those – but you can not jump from one to the other down the road if the benefit amount changes. 

After Filing for Social Security

As with other rules, the rest of the benefit guidelines are pretty much the same as a straight-forward SS filing. You are still subject to the same earnings rules, so if you choose to work after filing for benefits your earnings might impact how much you are able to receive. This is why it's important to wait as long as possible before filing, to give yourself the best possible chance of bringing in the maximum amount of benefits.

As you can see, filing for Social Security Benefits as a divorcee can be a tricky process. Not only do you have to know your own benefit potential, you also have to keep track of your ex-spouse to know whether he or she is in a position to help you better off, financially. In addition to all of that, knowing how your age can determine what you can actually file for adds an even extra layer of complexity!

Did you know there are over 2,700 Social Security claiming rules? Check out our free guide that will give you simple answers to when, why, and how to file for Social Security.

It can be hard to keep track of all of this. If you would like to speak to someone concerning your Social Security benefits and how and when filing works best for you, it’s time to talk to the experts today. Why not contact us at NextGen Wealth? We are ready to listen to your situation and help you plan out the next phase of your life!

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About the Author

Aurtho Clint Haynes, CFPThis article was written by Clint Haynes, CFP®. Clint is a Certified Financial Planner® and Founder of NextGen Wealth. You can learn more about Clint by reading his full bio here.

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