Can I Collect My Ex Husband’s Social Security If He Is Remarried
Can I collect Social Security as a divorced spouse if my ex-spouse remarries? Yes. … Your status as a partner in that unit stands, whether or not your ex-husband or ex-wife marries again. However, if you remarry and become part of a new marital unit, your eligibility for benefits based on the previous unit ends.
Are Taxes Taken Out Of Social Security Checks
Nobody pays taxes on more than 85 percent of their Social Security benefits, no matter their income. The Social Security Administration estimates that about 56 percent of Social Security recipients owe income taxes on their benefits. … The IRS has an online tool that calculates how much of your benefit income is taxable.
Taking Social Security: How To Benefit By Waiting
For those who are able to do so, it may make sense to wait even longer, because youll receive a larger monthly benefit even more than your full benefit. Every month past your full retirement that you delay, Social Security will increase your check by about 0.7 percent per month.
If your full retirement age is 66, then heres how much your check would increase:
|Retirement age||New benefit||A $1,000 check becomes|
So if your full retirement age is 66, then if you can wait two more years and claim benefits at age 68, youll increase your monthly check by 16 percent. In this case, if your full benefit were $1,000 a month, your new benefit would become $1,160 per month. And youll still receive cost of living adjustments on top of this amount, typically raising your payout a little each year.
Workers have other ways to grow their Social Security benefits, too, but its important to start early.
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Most Beneficiaries Will Lack Other Pension Benefits
Relatively few future retirees can count on one traditional mainstay of retirement income: an employer-provided, defined-benefit pension plan. Coverage under such plans has fallen precipitously. That trend has led researchers at the Urban Institute and the Social Security Administration to warn about the disappearing defined benefit pension, which will significantly affect baby boomers now in or approaching retirement. Most low-income elderly households have very little pension income, if any the majority of elderly households in the bottom third of the income distribution receive no pension income at all, compared to more than 80 percent of those in the top two-thirds.
Trends strongly indicate that the composition and distribution of retirement income will change significantly. Roughly two-thirds of non-Social Security retirement income in 2012 was from traditional defined-benefit pensions, according to the Census study but in the private sector those pensions have largely been replaced by defined-contribution plans, which shift the financial risks to employees, for todays workers.
Maximum Social Security Benefit At Age 62 Summary
Heres the bottom line:
Claiming Social Security at 62 in 2022 mean you will receive less than you would have if you waited until your full retirement age .
In 2022, if you start collecting Social Security at 62, the maximum benefit you can receive is $2,364.
This is compared with a maximum benefit of $3,345 at full retirement age.
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What If Your Earnings Are Falling Short
If you’re earning enough to reach the maximum benefit amount, that’s fantastic. But the average worker will struggle to reach the income limits, and not everyone can afford to work 35 years before claiming.
The good news is that if you’re willing and able to delay benefits past age 62, you can earn closer to the maximum benefit amount.
Say, for example, you have an FRA of 67 years old, and by claiming at that age, you could receive $1,600 per month. If you were to claim early at 62, your benefits would be reduced by 30%, leaving you with $1,120 per month. But if you delay benefits until age 70, you’d receive your full benefit amount plus an extra 24%, or $1,984 per month.
Not everyone will be able to wait until age 70 to file for benefits. But if you’re unable to reach the maximum benefit amount, delaying Social Security is one of the best and easiest ways to boost your benefits.
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Does Social Security Count As Income
Since 1935, the U.S. Social Security Administration has provided benefits to retired or disabled individuals and their family members. … While Social Security benefits are not counted as part of gross income, they are included in combined income, which the IRS uses to determine if benefits are taxable.
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Before You Make Your Decision
There are advantages and disadvantages to taking your benefit before your full retirement age. The advantage is that you collect benefits for a longer period of time. The disadvantage is your benefit will be reduced. Each person’s situation is different. It is important to remember:
- If you delay your benefits until after full retirement age, you will be eligible for delayed retirement credits that would increase your monthly benefit.
- That there are other things to consider when making the decision about when to begin receiving your retirement benefits.
Are Social Security Benefits Taxable At Full Retirement Age
Your age does not have an impact on whether you will owe tax on Social Security benefits. Depending on your earnings, you may pay federal taxes on Social Security benefits regardless of the age at which you claim.
Social Security benefits are taxed on amounts exceeding the “provisional income” limit set by the IRS. To calculate your provisional income, add up all non-Social Security sources of income, including nontaxable income such as municipal bond interest, and include half of your annual Social Security income.
Single filers earning provisional income between $25,000 and $34,000 and married joint filers earning between $32,000 and $44,000 will owe income taxes on 50% of their Social Security benefits. For single filers with provisional income above $34,000 and married filers above $44,000, up to 85% of Social Security benefits will be taxable.
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What Is The Future Of Social Security
As of June 2022, the Social Security Trust Fund is projected to have enough resources to cover all promised benefits until 2035 when, absent a change from Congress, benefits would need to be cut for all current and future beneficiaries to about 80% of scheduled benefits.2 Over the longer term, changes to the full retirement age or means testingâwhich could reduce or eliminate benefits based on your other income sourcesâmay also be considered.
If you’re skeptical about the future of Social Security or wary of potential changes, you may be tempted to start benefits early, assuming that it’s better to have something than nothing. Regardless of your situation, if you are concerned about the future prospects for Social Security, then that’s a good reason to save moreâand earlierâfor your retirement.
Future Retirees Already Face A Benefit Squeeze
Social Security has always aimed to provide retired or disabled workers with a benefit that replaces a reasonable fraction of their lost earnings. Benefits make up a larger fraction of past earnings for lower-paid workers than for higher-paid workers, which is one of the programs progressive features. In Social Security parlance, lower-wage workers receive a higher replacement rate.
Although individual circumstances vary, financial planners recommend as a rule of thumb that retirees aim to build a portfolio that replaces about 70 percent of their previous income. Social Security will get them only partway toward that goal. For a medium worker who retires at age 65 in 2020, Social Security will replace about 38 percent of previous earnings. That figure has fallen in recent years, and will continue to fall further as the programs age for full benefits , which climbed from 65 to 66 in the past decade, rises further from 66 to 67 as a consequence of legislation enacted in 1983 .
Furthermore, rising Medicare premiums will take a growing bite out of beneficiaries Social Security checks. Most beneficiaries 65 and older, along with most disabled workers under age 65, participate in Medicares Supplementary Medical Insurance program and have the premium deducted from their Social Security checks. Most also enroll in the prescription drug program, Medicare Part D, although they pay the premium to their chosen insurance plan rather than having it deducted from their check.
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What If You Don’t Qualify For The Max Benefit
The reality is that the vast majority of seniors won’t be eligible for the maximum Social Security benefit, and that’s OK. You can still take steps to increase your benefits as much as possible.
For instance, maybe you can’t reach the maximum taxable earnings limit, but you can increase your income slightly. That alone will result in larger checks each month. Or maybe you can’t or choose not to delay benefits, but you can work at least 35 years before you claim. That, too, will make a difference in your monthly payments.
You don’t need to reach the maximum benefit amount to enjoy a comfortable retirement. By taking smaller steps to boost your Social Security, though, you can earn more than you might think.
The $18,984 Social Security bonus most retirees completely overlook
If you’re like most Americans, you’re a few years behind on your retirement savings. But a handful of little-known “Social Security secrets” could help ensure a boost in your retirement income. For example: one easy trick could pay you as much as $18,984 more… each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we’re all after. Simply click here to discover how to learn more about these strategies.
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Find Your Social Security Full Retirement Age
You can claim your Social Security benefits a few years before or after your full retirement age, and your monthly benefit amount will vary as a result. But first you have to know what it is.
Also known as normal retirement age, your Social Security Full Retirement age is the age at which youre entitled to 100% of the Social Security benefits youve earned. FRA is 66 for beneficiaries born between 1943 and 1954 it gradually increases to 67 for beneficiaries born in 1960 or later. If you take benefits before FRA, your benefits will be reduced. If you file at age 62, for example, benefits will be as much as 30% lower. More on that in a moment.
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Theres A Social Security Spousal Benefit
Marriage is rewarded when it comes to Social Security. One spouse can take whats called a spousal benefit, worth up to 50% of the other spouses Social Security benefit. For example, if your monthly Social Security benefit is worth $2,000 but your spouses own benefit is only worth $500, your spouse can collect a spousal benefit worth $1,000 bringing in $500 more in income per month.
Just as the benefit based on your own work history is reduced if you claim it early, the same is true for a spousal benefit. That 50% figure is the maximum amount that only a spouse who is at least full retirement age is eligible for. Taking the spousal benefit early at, say, age 62, reduces the amount to as little as 32.5% of the higher earners benefit. If you take your own benefit early and then later switch to a spousal benefit, your spousal benefit will still be reduced.
Your Monthly Social Security Benefits Increase The Longer You Wait To Claim
While you can collect Social Security benefits as soon as you turn 62, taking benefits before your full retirement age will spell a permanent reduction in your payments of as much as 25% to 30%, depending on what your full retirement age is.
If you wait until you hit full retirement age to claim Social Security benefits, youll receive 100% of your earned benefits. But you can do even better by waiting to claim your Social Security benefits at age 70 your monthly Social Security benefit will grow by 8% a year until then. Any cost-of-living adjustments will be included, too, so you dont forgo those by waiting. Think of that time as bonus earning years and remember that youd be hard pressed to find those sorts of gains for zero risk during that period anywhere else.
Waiting to claim your Social Security benefits can help your heirs as well. By waiting to take her benefit, a high-earning wife, for example, can ensure that her low-earning husband will receive a much higher survivor benefit in the event she dies before him. That extra income of up to 32% could make a big difference.
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Effect Of Delaying Retirement Benefits
1Represents Full Retirement Age based on DOB January 2, 1960
2PIA = The primary insurance amount is the basis for benefits that are paid to an individual
That higher baseline would last for the rest of your retirement and serve as the basis for future increases linked to inflation. While it’s important to consider your personal circumstancesâit’s not always possible to wait, particularly if you are in poor health or can’t afford to delayâthe benefits of waiting can be significant.
Be aware that if you decide to wait past age 65, you may still need to sign up for Medicare. In some circumstances your Medicare coverage may be delayed and cost more if you don’t sign up at age 65. If you start Social Security benefits early, you’ll automatically be enrolled into Medicare Parts A and B when you turn age 65.
Your annual Social Security statement will list your projected benefits between age 62 to 70, assuming you continue to work and earn about the same amount through those ages. If you need a copy of your annual statement, you can request one or view it online on the Social Security Administration portal.
Social Security Auxiliary Benefits
In addition to the individual benefit the primary earner can claim, eligible family members each can claim auxiliary benefits of up to 50% of the primary earners benefits. The maximum family benefit comes into play when two or more family members claim auxiliary benefits based on one primary earners record.
For example, say a familys primary breadwinner retires at full retirement age and is eligible for a benefit of $2,000 a month. A non-working spouse with no earnings record who has reached full Social Security retirement age can claim an auxiliary benefit of $1,000 a month, equal to 50% of the primary breadwinners earnings record.
Combining the primary breadwinners $2,000 benefit with the spouses $1,000 auxiliary benefit makes a total of $3,000 in Social Security benefits for one family. There is no need to figure the maximum family benefit here, because it only applies when two or more family members claim benefits based on one persons earning record.
Now lets say also that the couple has an adult child who, because of a disability, is also eligible to be paid 50% of the primary breadwinners benefit. This would come to another $1,000 and, added to the benefits paid to the primary breadwinner and non-working spouse, bring the familys total benefit to $4,000.
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While You Can Start Collecting Benefits At Age 62 Should You Collect Early Or Delay
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For many elderly people, Social Security benefits make up one of their primary sources of income in retirement. For half of seniors, Social Security comprises about half of their retirement income, according to the Center on Budget and Policy Priorities. Some studies estimate that without Social Security, between 30% and 40% of senior citizens would be considered below the poverty line.
The age at which you decide to collect your Social Security benefits has a big impact on how much you’ll earn from the program over time because the longer you wait, the higher your monthly payout will be.
“Don’t just call Social Security and apply at age 62. Everybody has options. A married couple could receive $1 to $1.5 million in benefits over their lifetime. And single people could maybe half of that,” says Marc Kiner, a CPA at Premier Social Security Consulting. “And do not assume that Social Security will review your options with you.”
Select spoke to Kiner and Jim Blair, the lead consultant at Premier, about some of the factors you should consider when deciding when to apply for Social Security benefits.
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How Do You Become Eligible For Social Security Benefits
To be eligible for Social Security benefits in retirement, you must earn at least 40 “credits” throughout your career. You can earn up to four credits each year, so it takes 10 years of work to qualify for Social Security.
In 2022, you must earn $1,510 to get one Social Security work credit and $6,040 to get the maximum four credits for the year. And yes, that means that it is possible to have money withheld for Social Security and never get it back. The minimum is the minimum.
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