A reader wonders if he qualifies for a restricted application as well as an increased benefit from claiming Social Security under his ex-wife’s earnings record.
ROBERT POWELL, CFP®| Apr 29, 2021
I live in Costa Rica. I’m 68 years old (born 1952), my ex-wife is 75. We were married for 14 years and she made more money than me.
I retired at 62 and began receiving Social Security. Would I qualify for a restricted application, even though I’m receiving my own benefits? If I qualify, can I receive 6 months of benefits as a lump sum, retroactively?
When I first applied for benefits, the Social Security Administration (SSA) said that I qualify for an additional $145 if I provided my divorce decree. I’ve now done that and want to proceed with the restricted application.
Will my benefit increase if I apply under my ex-wife since her benefit is higher than mine?
Since your marriage lasted more than 10 years, you may be eligible for a divorced spousal benefit if that benefit is higher than your own full retirement age (FRA) retirement benefit, known as the PIA (primary insurance amount), says Joe Alfonso, CFP, founder of Aegis Financial Advisory. However, you can no longer file a restricted application since you already began your retirement benefit at age 62.
He adds, “You also indicate that your former spouse was the high earner. It only makes sense for the higher earning spouse to perform a restricted application since the intent is to maximize the higher benefit by delaying it to earn delayed credits while electing to receive a lower spousal benefit in the interim.”
Alfonso says, “If your ex-spouse is at least age 62 and the marriage ended at least 2 years ago, it is not necessary for your ex-spouse to be receiving her own retirement benefit for you to receive a divorced spouse benefit.”
The SSA will compare your PIA (even though you are receiving an early benefit) with the maximum divorced spouse benefit, calculated as 50% of the PIA of your ex-spouse, adds Alfonso. “If your PIA is smaller, the SSA will pay you your retirement benefit and add an additional amount based on the spousal benefit.”
In your case, since you began taking your own retirement benefit early and it was reduced for early claiming (by 25%), if you are entitled to a divorced spouse benefit, your total benefit will add up to less than the maximum divorced spouse benefit. The SSA will make this calculation for you.
“If you request retroactive benefits the SSA will go back 6 months from your date of application,” notes Alfonso. “They will not go back to your FRA since that was more than 6 months ago. Note that, unlike retirement benefits, spousal benefits do not earn delayed credits for starting them after FRA.”
Assistant editor Kim McSheridan assisted with this report.
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