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This week’s question is from Lester:
“My question concerns Social Security survivors benefits. If I should pass away before my full retirement age (FRA) and before collecting any benefit at all, will my surviving spouse receive benefits based on the age that I pass away?”
How age of death matters
Lester: This is a good question, because survivors benefits are an important aspect of the Social Security retirement program.
The amount that your spouse will receive will differ depending on whether you claim benefits or not. If you do not claim benefits, the amount will depend on your age when you die.
Let’s compare those situations first. Then, I will describe how the benefit may change depending on when your spouse claims survivors benefits.
If you do not claim your own retirement benefit and you die before your full retirement age (FRA), then survivors benefits will be based on your benefit at full retirement age.
For example, if your benefit is $1,000 per month at FRA and you die before your FRA, Social Security will determine the survivors benefits based on this $1,000.
On the other hand, if you claimed your own benefit at 64, your retirement benefit would be less than that hypothetical $1,000, and the survivors benefits would be based on this smaller amount. (There is a limit on the size of this reduction. The reduction cannot be below 82.5%. So, if you claimed at 62, the Social Security Administration would base the survivors benefits on $825 even though your benefit would be smaller.)
The situation changes if you live beyond your full retirement age. If you claim benefits after FRA, the survivors benefits will be based on your retirement benefit, and delayed claiming increases your Social Security benefits by 8% each year until age 70.
If you do not claim benefits and pass away between your FRA and 70, the survivors benefits would be based on an amount that you would have received if you claimed on the day that you died. Thus, if you pass away one year after you reach FRA, the survivors benefits would be based on $1,080.
This, however, is only the first step in the calculation of the actual survivors benefits. The actual benefit also depends on your spouse’s age when she claims survivors benefits. If she waits until her full retirement age, then these are indeed the amounts she will receive. If she claims before her FRA, however, her benefit will be smaller. If she claims at 60, the earliest age she can claim, then her benefit will be 71.5% of the base amount.
Each month she delays claiming her benefit will increase until at her FRA, she will get the full base amount. Waiting to claim beyond FRA will not increase her benefit.
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The questions I’m likeliest to answer are those that will interest other readers. So, it’s better not to ask for super-specific advice that applies only to you.
I hold a doctorate in economics from the University of Pennsylvania and taught economics at the University of Delaware for many years. I now do the same at Gallaudet University.
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Disclaimer: We strive to provide accurate information with regard to the subject matter covered. It is offered with the understanding that we are not offering legal, accounting, investment or other professional advice or services, and that the Social Security Administration alone makes all final determinations on your eligibility for benefits and the benefit amounts. Our advice on claiming strategies does not comprise a comprehensive financial plan. You should consult with your financial adviser regarding your individual situation.
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