Social Security Options for Older Divorcees

The economic well-being of older single women has been a concern among policymakers in this country for quite some time, in particular because women who are divorced are at significantly greater risk of experiencing poverty than widows and other older Americans. The fact is, one in five women over the age of 65 who are divorced wind up living in poverty, which is several percentage points higher than for other single and widowed women in the same age range.  There’s a lifeline through Social Security (SS), however.

Auxiliary Benefits 

Auxiliary benefits are available to divorced women who were previously married to the same individual for at least 10 years. The general rule is that women are entitled to:

1. A benefit based on their own earnings;
2. A benefit valued at one-half of their former spouse’s earnings, or:
3. A combination of the two.

Nothing these women collect impacts their former husbands’ entitlement.

The Social Security Administration (SSA) chooses the highest auxiliary benefit based on any previous marriages meeting the 10-year requirements, and compares that to the woman’s own earned SS benefit. In the event she is not eligible for any benefits based on her own work history, she is eligible to receive the full divorced-spouse benefit (50 percent of her X’s total benefit) or surviving divorced-spouse benefit (100 percent of her X’s total benefit).

If her own retirement benefit is less than the amount available through the auxiliary benefit, she can collect the difference between the auxiliary benefit and her own benefit, bringing her total eligibility equal to the total auxiliary benefit.

If her own SS earnings benefit exceeds that of the auxiliary benefits, she can collect just her own retirement benefit.

 Some Facts Worth Knowing 

Because lifetime earnings for women have increased in recent years, the outlook for divorced women after retirement is improving.  Nonetheless, there will be a large portion of women who would not be in good financial straits if they had to rely on just their own record of earnings.  Fortunately, women who are entitled to auxiliary benefits based on their former husband’s earnings have a brighter outlook. The breakdown projections of who will qualify for what looks like this:

Just under half of divorced women will either:

• Not have earned enough over a lifetime to claim any of their own Social Security benefits;
• Earned less in SS benefits than the auxiliary benefits from a former spouse would provide;
• One-third of divorced women will not have been married long enough to collect on an X’s earnings and will likely experience higher rates of poverty due to low incomes post-retirement.
• One-fourth of divorced women will have high enough lifetime earnings on their own that they will not be entitled to an auxiliary benefit.

Remarriage 

An important caveat worth knowing: If you choose to remarry while your former spouse is still living, you will most likely lose your divorced-spouse benefit.

The Legal Advocates You Need 

The experienced Springfield family attorneys at Courtney & Mills know how confusing divorce and all the implications of it can be.  But we are committed to ensuring that you understand your options, and we always work toward the best possible outcomes for you.  To discuss, schedule a confidential consultation in our Springfield office today.

Source:

ssa.gov/policy/docs/ssb/v72n1/v72n1p11.html