One of the most important aspects of retirement planning is ensuring that your spouse will be financially secure after you pass away. For many couples, Social Security survivor benefits represent a significant source of income for the surviving spouse. However, the decisions you make about when and how to claim your own benefits can have a lasting impact on what your spouse receives. By understanding how survivor benefits work and structuring your claiming strategy thoughtfully, you can help maximize income for your loved one during what may be a challenging time.
Understanding Social Security Survivor Benefits
When a spouse passes away, the surviving spouse may be eligible to receive survivor benefits based on the deceased spouse’s earnings record. If the surviving spouse has reached full retirement age, they may receive 100 percent of the deceased spouse’s benefit amount. Those who claim survivor benefits earlier will receive a reduced amount, though benefits can be claimed as early as age 60, or age 50 if the survivor is disabled.
It is important to note that the surviving spouse does not receive both their own benefit and the survivor benefit. Instead, they receive the higher of the two. This is why coordinating claiming strategies between spouses is so critical. The goal is to ensure that no matter who passes away first, the surviving spouse is left with the highest possible monthly income.
Strategies to Maximize Survivor Income
One of the most effective ways to protect your spouse is for the higher earner to delay claiming Social Security benefits until age 70. By waiting, the higher earner’s benefit grows by approximately 8 percent each year past full retirement age, resulting in a significantly larger monthly payment. This larger benefit then becomes the survivor benefit, providing the surviving spouse with more income for the rest of their life.
In some cases, it may make sense for the lower-earning spouse to claim their own benefit earlier. This allows the household to receive some Social Security income while the higher earner’s benefit continues to grow. Once the higher earner claims or passes away, the surviving spouse can switch to the larger survivor benefit. This approach balances current income needs with long-term protection.
Couples should also consider their health, life expectancy, and other sources of retirement income when making these decisions. If the higher earner has a shorter life expectancy due to health concerns, delaying benefits may not always be the best choice. A comprehensive review of your financial situation can help determine the optimal approach for your unique circumstances.
Partner with Safe Harbor Wealth Advisors
Planning for survivor benefits is an essential part of protecting your spouse and ensuring their financial security after you are gone. At Safe Harbor Wealth Advisors, we help couples navigate the complexities of Social Security claiming strategies and develop personalized plans that maximize lifetime income for both spouses.
If you want to ensure your spouse is protected no matter what the future holds, we are here to help. Call Safe Harbor Wealth Advisors today at (614) 760-0670 or visit our website to schedule your complimentary consultation. Together, we will create a strategy that provides peace of mind and lasting financial security for you and your loved ones.