October is National Retirement Security Month, which is intended to raise public awareness of the importance of saving for retirement, thus encouraging all to consider their so-called “golden years.”  Obviously, building a nest egg for retirement is crucial, but Social Security will also play a big part in nearly everyone’s retirement planning. So, during that retirement planning process, don’t forget to consider your dependents, because when you retire and claim Social Security has a profound effect on your dependents as well. In short, “retirement security” isn’t just for you, but for your family as well.

The most obvious consideration for family retirement planning is your spouse. A fairly common misconception is that a spouse can simply claim 50% of their partner’s monthly benefit at any time, but that is not how it works. The rules say that a spouse can get 50% of their partner’s SS benefit, but only if claimed at full retirement age (FRA)[1] and then, only if the spouses personally earned Social Security entitlement at FRA is less than 50% of their partner’s FRA entitlement. Spouse benefits are only paid if both partners are already collecting Social Security, which means that when you claim Social Security also impacts when your spouse can get their full spousal entitlement. Since spouse benefits last for as long as you both live[2], they are an important part of your spouse’s “retirement security” too.  

Consider this: if a spouse’s own SS retirement benefit at FRA is less than 50% of their partner’s FRA benefit entitlement and the spouse claims benefits at their FRA, the spouse will receive their own earned SS retirement benefit, plus a “spousal boost” equal to the difference between their own FRA amount and half of their partner’s FRA amount. This equates to the spouse, at FRA, receiving a payment equal to 50% of their partner’s FRA amount, regardless of when their partner claimed SS. But spouse benefits are only paid when both spouses are receiving benefits, so “retirement security” for a spouse is very much dependent on when each partner claims Social Security.  Depending on the age difference of marital partners, it may be prudent for an older partner to claim benefits so that the younger partner can get spouse benefits sooner. But life expectancy plays a key role in deciding when each partner should claim (see this).

“Retirement Security” may also extend to other dependents. For example, a disabled adult child (disabled before age 22) can get Social Security disability benefits for life based on a parent’s work record. And minor children under the age of 18 (or up to 19 if still in high school) can get benefits until they become adults, and a spouse caring for your minor children under age 16 can get early “child in care” spouse benefits as well. In certain circumstances, too, an elderly parent may be entitled to benefits on your lifetime work record, and un-married former (divorced) spouses may also be eligible for benefits from you. So, it’s important to know and understand that – when it come to “retirement security” planning – Social Security isn’t just for you, it’s for your dependents as well.   

To get answers to all your questions, the AMAC Foundation offers free Social Security Advisory Services by AMAC-certified and NSSA®-accredited experts. Contact us via email at SSadvisory@amacfoundation.org, or by phone at 1(888) 750-2622 for personal and individual answers to all your Social Security questions.  

[1] If claimed earlier, the spousal amount is reduced.

[2] When one spouse dies, the surviving spouse may be entitled to a “survivor benefit,” instead of a “spousal benefit”. “Survivor benefits” are usually more than “spousal benefits.”