Skip to content

Seniors Who Find Love Don’t Always Marry Because of Social Security

Happy-old-coupleWidowed or divorced seniors who decide to remarry late in life, need to understand that this may make a big change in their Social Security benefits. They also need to review their estate plan.

Marital status is part of the calculations made by the Social Security Administration to determine benefit levels. That’s why there are couples in their 50's and 60's who chose not to marry, but live together instead. They aren’t radicals embracing free love. They just don’t want to lose out on their benefits.

Investopedia’s recent article, “How Remarrying Late in Life Impacts SS Benefits,” gives us some things to consider.

First, if either you or your intended is widowed and receiving Social Security benefits based on the deceased spouse’s work record, age is important. A surviving spouse who remarries prior to age 60, becomes ineligible to receive benefits on their late spouse’s record. However, after your first anniversary with your new spouse, you become eligible for spousal benefits, based on the new spouse’s work record.

Decide whether to wait for marriage in order to keep a widow’s benefit for longer, or if the spousal benefit from a new union will offer more financial security. If you’re married at least nine months prior to one spouse’s death, the surviving spouse is eligible for spousal benefits based on the second marriage.

If one or both members of the new couple is divorced, things are trickier because the Social Security Administration does allow a divorced spouse to collect spousal benefits based upon the work records of their deceased ex-spouse, as long as the divorced beneficiary meets the following criteria:

  • The original marriage lasted at least 10 years;
  • The beneficiary applying for divorced spousal benefits has remained unmarried; and
  • The beneficiary applying for divorced spousal benefits is at least 62.

If you are divorced from an ex who significantly out-earned you and your new fiancé, remarrying stops the ex-spousal benefits you’d otherwise receive. This can make a big difference in your finances, and co-habitating without getting hitched, may make more financial sense for some couples.

Beneficiaries who are receiving Social Security Disability Insurance (SSDI) may have the toughest calculations, as far as a second marriages are concerned. This is because SSDI beneficiaries are subject to a family maximum benefit (FMB) calculation. The FMB limits the amount of money available for auxiliary benefits, like the dependent child benefit. Figure out and compare these three amounts to determine FMB:

  1. 85% of the worker’s average indexed monthly earnings (AIME).
  2. The worker’s primary insurance amount (PIA), based on full retirement age.
  3. 150% of the worker’s PIA.

If number three is the highest of these three calculations, then the FMB is the higher of number one or two. But if number one is the highest of the three calculations, then the FMB is number three.

Love at any age and stage is a wonderful thing, but if marriage is involved, there are financial and estate planning consequences to take into consideration. Couples need to be informed about what will change, and what will not, when they marry. A visit to the estate planning attorney’s office is definitely in order for “gray” newlyweds. Without updating the estate plan, children from a prior marriage could end up being completely disinherited.

Reference: Investopedia (August 1, 2018) “How Remarrying Late in Life Impacts SS Benefits”