Q & A
What exactly is the Social Security benefit for surviving spouses?
Complete Question: I’m currently trying to plan for the best time to file for my benefits. I’ve been told to think about my wife because the timing of when I file will affect her widow’s benefit. When I tried to get more information about this, I got more confused. Some of the phrasing is ambiguous, especially when it comes to whether or not my wife would be affected by my delayed retirement credits and what would happen if I would pass away before I file. So can you tell me how the surviving spouse benefit is determined?
Answer: You are absolutely right that sometimes the explanations, especially in this situation, can leave you with more questions than answers. So I will be happy to explain this for you and anyone else who is struggling to find the answer.
As you brought up, there are multiple scenarios to consider. To help try to make each explanation as simple as possible, let’s assume that (1) your wife takes the widow’s benefit at full retirement age or later; and (2) your primary insurance amount is $1,000. Note that the primary insurance amount (PIA) is the amount you would receive at full retirement age (currently age 66).
1) If the insured worker (meaning you) were to pass away before age 62, the calculation for the surviving spouse benefit for your wife is a little complex; however, it is essentially the same amount as your estimated primary insurance amount of $1,000. (This is because your PIA is an estimated amount until you actually file for benefits; therefore, the exact amount the surviving spouse would get in this situation may vary slightly.)
Example: If you were to pass away at age 61, the Social Security Administration would calculate a “special” primary insurance amount to determine your wife’s widow’s benefit. It would be approximately $1,000/month.
2) If the deceased had elected to take Social Security benefits early and therefore received a reduction in benefits, the surviving spouse will be affected by that reduction. In this case, the surviving spouse receives the reduced amount OR 82 1/2% of the deceased’s primary insurance amount (PIA), whichever is larger.
Example: If you take your benefit at age 62, your benefit will be $750. This means your wife’s widow’s benefit would be $750 OR 82 1/2% of your PIA ($1,000), whichever is higher. Since 82.5% of $1,000 is $825, your wife would receive $825/month in widow’s benefits.
3) If the deceased had put off filing until after full retirement age and received delayed retirement credits, the surviving spouse will receive a higher benefit based on the delayed retirement credits earned by the deceased.
Example: If you wait until age 70 and earn a 32% increase in your benefit due to delayed retirement credits (DRCs), your benefit amount would then be $1,320 (132% of your PIA). When you pass away, your wife would also receive $1,320/month for her widow’s benefit.
4) If a person decides to wait until after full retirement age to file for Social Security in order to receive delayed retirement credits (DRCs), but passes away before actually filing for Social Security, the surviving spouse will receive a benefit based on the DRCs that would have been earned if the deceased filed in the month of death. In other words, all DRCs earned up to, but not including the month of death are included in the surviving spouse benefit.
Example: If you passed away at age 67 and 1 month and did not yet file for Social Security benefits, your wife would receive a widow’s benefit for 108% of your PIA (8% increase for one year, but the month of death is not included). This means her widow’s benefit amount would be $1,080.
I know this can still seem complicated; however, it at least may help you decide the best situation for you when planning for your financial needs now and for your wife in the future.