The Two Exceptions To Know Around The 1 Year Marriage Requirement
Normally, you must be married for at least 12 continuous months to meet the spousal benefit duration-of-marriage requirement. However, there are two exceptions to this rule.
If you marry someone who is the natural mother or father of your child, the one year requirement is waived.
Be the natural mother or father of the workers biological son or daughter i.e., this requirement is met if a live child was born to the number-holder and claimant although the child need not be alive.
The 1-year requirement is also waived if you were entitled to Social Security benefits on someone elses work record in the month before you were married.
An example of these benefits would be spousal benefits, survivor benefits or parents benefits.
For example, lets assume you will be eligible for a spousal benefit from your ex-husband Joe. If you remarry, you wouldnt have to wait the full 12 months to get a spousal benefit from your new spouse. Instead, youd be immediately eligible.
This topic is closely related to the Social Security Survivor Benefit. Ive written an in-depth but easy-to-understand article titled Social Security Survivor Benefits: The Complete Guide to Who Gets What and How to Calculate It if you want to learn more.
There Are A Few Tools You Can Use To Calculate Your Social Security Benefits Including Signing Up For A My Social Security Account
The best way to estimate your Social Security benefits is to sign up for a my Social Security account. The Social Security Administration used to mail benefit statements every five years to workers between the ages of 25 and 60 and then annually until they started taking benefits. But since 2011, the agency has cut back on mailing statements. It now only sends paper statements to workers who are at least 60 years old and have not yet signed up for a my Social Security account. The statements are sent about three months before your birthday.
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For those who have an account, you will receive an email about three months before your birthday reminding you to review your online statement.
The benefit estimate provided in the statement is based on your past earnings and a projection of your future income, which assumes your income will remain at the same level as the previous year until you retire. You could get more than the estimate if you end up earning more in the future or less if your income drops. The statement provides an estimate if you continue working until age 62, your full retirement age and age 70.
The statement also includes an estimate for survivor benefits for your family and what you would receive each month if you became disabled and started taking disability benefits.
What If There Is Extra Money
If you pay your bills and take care of some necessities and have money left over, you shouldnt go overboard and waste it. Instead, you should use your funds wisely. You should consider opening a bank account, which draws interest.
That way, you can have your funds put away and be getting interest, which will add to your total cash amount. You will want to put the money in an account so it can be accessed if there is an emergency, such as a vehicle that breaks down and either needs repairs or replacement, or you may have a medical emergency or need to make repairs to your home. You can also use these funds for insurance deductibles in situations when you must file a claim with your health, auto, or homeowners coverage.
Remember, emergencies do happen. If you have some extra funds to put away it can be very helpful to your family and can help resolve future financial crisis that you may face.
There are emergencies that require financial resources more often than you think, so having some cash that you can access in such situations can be a real life changer. Check with different banks about interest drawing accounts and learn which would be more suitable for your specific needs.
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No More File And Suspend
Note that the claiming strategy called file and suspend, which allowed married couples who have reached their FRA to receive spousal benefits and delayed retirement credits at the same time, ended as of May 1, 2016. However, spouses born before Jan. 2, 1954, who have attained their FRA may still be able to file a restricted application. It allows them to claim spousal benefits while delaying their own benefits up to age 70.
Social Security benefits can be taxable if your combined income is high enough.
Who Can Use The Retirement Estimator
You can use the Retirement Estimator if you have enough Social Security credits to qualify for benefits and you are not:
- Currently receiving benefits on your own Social Security record.
- Waiting for a decision about your application for benefits or Medicare.
- Age 62 or older and receiving benefits on another Social Security record.
- Eligible for a Pension Based on Work Not Covered By Social Security.
If you are currently receiving only Medicare benefits, you can still get an estimate. For more information, read our publication Retirement Information for Medicare Beneficiaries.
If you cannot use the Retirement Estimator or you want a survivors or disability benefit estimate, please use one of our other benefit calculators.
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How To Correct An Error On Your Social Security Statement
If you have evidence of your covered earnings in the year or years for which you think Social Security has made an error, call Social Security’s helpline at 800-772-1213, Monday through Friday, from 7 a.m. to 7 p.m. This is the line that takes all kinds of Social Security questions, and it is often swamped, so be patient. It is best to call early in the morning or late in the afternoon, late in the week, or late in the month. Have all your documents handy when you speak with a representative.
If you would rather speak with someone in person, call your local Social Security office and make an appointment to see someone there, or drop into the office during regular business hours. If you drop in, be prepared to wait, perhaps as long as an hour or two, before you get to see a representative. Bring with you two copies of your benefits statement and the evidence that supports your claim of higher income. That way, you can leave one copy with the Social Security worker. Write down the name of the person with whom you speak so that you can reach the same person when you follow up.
The process to correct errors is slow. It may take several months to have the changes made in your record. After Social Security confirms that it has corrected your record, request another benefits statement to make sure the correct information made it to your file.
Social Security Benefits Calculator: How Much Will You Get Based On Your Salary
This benefit can be claimed as soon as possible
By 2022, Social Security beneficiaries receive a 5.9% increase, considered the largest boost in benefits in 39 years.
Next year’s benefit is a substantial boost over the 1.3% that retirees saw in 2021.
The maximum monthly payment will be $4,194, while the average benefit will be less than $1,657, according to various reports.
The cost-of-living adjustment increase, an average benefit of $1,657 per month, will be approximately $92 per month for most retired workers.
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How Are Social Security Survivor Benefits Calculated
To understand Social Security benefit calculations, you first need to understand one piece of jargon: primary insurance amount . A persons primary insurance amount is the amount of their monthly retirement benefit, if they file for that benefit exactly at their full retirement age.
If your spouse has died and you file for a benefit as their survivor, your benefit will depend on:
- Your deceased spouses PIA,
- Whether your deceased spouse had already filed for his/her retirement benefit ,
- The age at which your spouse died, and
- The age at which you file for your benefit as a surviving spouse.
Lets first assume that you have reached your survivor full retirement age by the time you file for your survivor benefit.
If your spouse had not filed yet for his/her own retirement benefit by the time he/she died, then:
- If your spouse died prior to his/her full retirement age, your benefit as a surviving spouse will be your deceased spouses PIA.
- If your spouse died after reaching his/her full retirement age, your benefit as a surviving spouse will be whatever he/she would have received as a retirement benefit, if he/she had filed on his/her date of death.
If your spouse had filed for his/her own retirement benefit by the time he/she died, then your benefit as a surviving spouse will be the greater of:
- The amount your deceased spouse was receiving at the time of his/her death, or
- 82.5% of your deceased spouses PIA.
How Do I Increase My Social Security Benefits After Retirement
To increase your monthly benefit, don’t start taking Social Security payments right when you reach full retirement age. The longer you wait, the more you’ll get each month. If you want to get the highest possible amount of Social Security benefits each month, you need to wait until age 70 to retire.
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How Much Is The Social Security Spousal Benefit
If youre eligible and can qualify, the spousal benefit can be as much as 50% of the higher-earning spouses full retirement age benefit.
If your spouses full retirement age benefit amounts to $2,000 per month, your spousal benefit at your full retirement age could amount to $1,000 per month.
Its important to note that this benefit cannot be more than 50% of the higher-earning spouses full retirement benefitbut it can be less!
Thats because the benefit is also based on your filing age. Depending on how old you are when you file, the spousal benefit amount will range between 32.5% and 50% of the higher-earning spouses full retirement benefit.
Check out the chart below to get an idea of how the benefit works and what your payment might be if you can take advantage of spousal benefits. The chart assumes that your full retirement age is 67 and your spouses full retirement age benefit is $2,000 per month.
Did you notice the steep penalty for filing early? You receive significantly less in payments if you choose to file sooner rather than wait until full retirement age.
You may have also noticed that the spousal benefit does not increase beyond your full retirement age. When considering your own Social Security benefit, there can be a lot of advantages to waiting to file and delaying when you start receiving payments well past your retirement age, but thats not the case here.
Timing And Your Health Coverage
Your health insurance coverage can also play a role in deciding when to claim Social Security benefits. Do you have a health savings account to which you would like to keep contributing? If so, note that if youre age 65 or older, then receiving Social Security benefits requires you to sign up for Medicare Part A, and once you sign up for Medicare Part A, youll no longer be allowed to add funds to your HSA.
The SSA also cautions that even if you delay receiving Social Security benefits until after age 65, you might still need to apply for Medicare benefits within three months of turning 65 to avoid paying higher premiums for life for Medicare Part B and Part D.
In 2022, the average monthly premium for Part D will be $33 per month versus $31.47 in 2021. If you enroll in a Medicare Advantage plan, the average monthly premium will be $19 per month in 2022 versus $21.22 in 2021. However, if you are still receiving health insurance from your or your spouses employer, you might not yet have to enroll in Medicare.
As of Oct. 16, 2021, Social Security offices are only open by appointment, and to get an appointment you need to be in a limited, critical situation. Most people will have to transact their business online, by phone, or through the mail.
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Adjust Your Pia For The Age You Will Begin Benefits
The final amount of Social Security retirement benefit that you receive is based on the age when you begin benefits.
Of course, another complex formula is used to determine how much more you will receive if you wait.
This formula uses your Primary Insurance Amount calculated in the previous step. This is the amount you will get if you start benefits at your full retirement age . Your FRA can vary, depending on the year you were born. For people born between 1943 and 1954, as in our example, the FRA is age 66.
For people born on Jan. 1, the FRA is based on the year prior. Someone born on Jan. 1, 1955, will have an FRA based on 1954.
A reduction is applied to your PIA if you begin benefits before your FRA. A credit, referred to as a “delayed retirement credit,” is applied if you begin to receive benefits after your FRA.
The Source Ofand Solution Tothe Problem
When the current Social Security formula was put in place in 1977, no provision was made for the contingency that economic conditions would be so dire that average wages would fall in any given year. This problem first surfaced in 2009 during the Great Recession. The AWI, however, fell by a relatively small amount, and policymakers chose not to do anything about it. As a result of the COVID-19 pandemic, however, the decline in the AWI is likely to be about four times as big now as it was during the Great Recession.
There is ample precedent for fixing this problem. The first precedent concerns Social Security cost-of-living allowances . As mentioned above, payments in years after beneficiaries first year of retirement are indexed to inflation using a version of the consumer price index . However, under the law, if prices fall in any year, benefits are not adjusted downward rather, they remain the same. The second precedent concerns the Social Security contribution and benefit base, also known as the taxable maximum. The taxable maximum is the dollar amount of annual earnings above which the Social Security payroll tax does not apply. The taxable maximum is indexed to the AWIbut like COLAs, it is never adjusted downward.
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Special Rule As You Approach Full Retirement Age
If you are already receiving your retirement benefits, a special higher earnings limit applies in the calendar year you turn your full retirement age . If you will reach full retirement age in 2021, you can earn up to $4,210 per month without losing any of your benefits, up until the month you turn 66. But for every $3 you earn over that amount in any month, you will lose $1 in Social Security benefits. Beginning in the month you reach full retirement age, you become eligible to earn any amount without penalty.
If you are self-employed, you may receive full benefits for any month during this first year in which you did not perform what Social Security considers âsubstantial services.â The usual test for whether you worked substantial services is whether you worked in your business more than 45 hours during the month . In other words, if you work in your business more than 45 hours in a month, Social Security may reduce your benefit.
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The Problem: The Economic Toll From The Pandemic Will Very Likely Affect Social Security Benefits
The initial retirement benefits that Social Security beneficiaries receive in the first year of retirement are determined by a formula that depends, in part, on the growth of average wages in the economy. Due to the economic fallout from the COVID-19 pandemic, the key measure of average wagesthe average wage index is very likely to decline in 2020. As a result, the initial retirement benefits for those who are first eligible to receive benefits in 2022when they reach the age of 62would be significantly less than what was anticipated only months ago, before the pandemic began to exact its economic toll. The effect is very likely to be so significant that workers turning 62 in 2022 would receive initial retirement benefits that are less than those of workers who were born a year earlier and who had essentially the same earnings history. This incongruity is what Social Security experts call a benefit notch. Such a notch would be unfair to the beneficiaries who turn 60 in 2020 and first become eligible to retire in 2022 because benefits are normally expected to grow for each successive cohort of retirees. Moreover, the benefit reduction and notch would have long-lasting consequences, as they not only would affect benefits in the first year of ones retirement but also lower them for every year going forward, as annual benefits are determined by adjusting the initial level for inflation.
How To Get A Copy Of Your Social Security Statement
The SSA mails out Social Security Statements to follks age 25 and over before their birthdays during their 25, 30, 35, 40, 45, 50, 55, and 60 years. For those age 60 until retirement, the SSA will send out statements every year. You can also go online to get a copy of your statement or view it online. Go to www.ssa.gov/mystatement/ and open an account with Social Security to view your statement.