February 12, 2021

Edited 02/17/21

5 Ways Marital Status Affects Social Security and 2021 Changes

Your complete breakdown of the different ways your relationship status can have an effect on your Social Security benefits, and what you can expect your benefits to look like in 2021.

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Whether it’s a romantic candlelit dinner with your partner or a happy hour with your pals, your relationship status can impact how you spend a Saturday night.

But it affects more than just that, too. When you’re thinking about retirement and the Social Security benefits you collect, that status can play a role in determining your budget, deciding on the best time to retire, or sending extra benefits your way. 

Check out our guide to the ways your marital status can affect your Social Security, as well as the benefit changes you can expect to see in the year ahead.

5 Ways Your Relationship Status Can Affect Social Security:

1. It might change when you decide to collect.

If you’re married and both qualify for Social Security, it’s smart to strategize about when to start taking it in order to maximize your benefits. 

If one of you earns significantly less than the other, the lower earner might start claiming right at age 62 in order to start bringing in a little extra cash. Then, the higher earner can hold off until they hit their full retirement age, or FRA, (which is anywhere from 65 to 67, depending on when they were born). 

Each year you delay taking your benefits from FRA, you get an increase of 8% added to your payment. So, if possible, the higher earner might even wait until 70. That’s when the extra 8% ends and they qualify to reach their maximum Social Security benefit—124% of what they will receive if their FRA is 67, and 132% if their FRA is 66. Unlike your own retirement benefits, spousal benefits do not increase if you wait to take benefits beyond your full retirement age.

At that point, when the higher earner starts to collect, the Social Security office will automatically switch the lower earner to the spousal benefit system, if that means they’ll collect more than what they would have on their own. 

If you and your spouse earn around the same amount, it might be smarter just to try to hold off on collecting Social Security so that you can both maximize your benefits later on.

Deciding when to collect typically involves doing some math, but you’re not on your own there. With Silvur’s easy-to-use Social Security calculator, in seconds you can plug in all your info and play around with different dates to evaluate all your options.

2. It might mean you get benefits from your ex.

If you were married for at least 10 years, and are now divorced and have not remarried, you might be eligible for divorce benefits. You’d be able to get up to 50% of what your ex-spouse could collect at their FRA. 

If you’ve had multiple marriages that would potentially qualify you, you’re only eligible to collect on one. Or, if your ex-spouse has multiple exes that would qualify, it’s not a race to claim—anyone who is eligible will get the benefit, regardless of if another person is also claiming. 

But don’t worry about waiting around for your ex to claim. You can start to collect those benefits if you’ve been divorced for at least two continuous years, and you don’t need to contact or wait for any kind of permission from your ex-spouse in order to claim. But keep in mind that if you start collecting at 62 rather than your ex-spouse’s FRA, your benefit check will be lower than it would be if you wait till their FRA. And since spousal benefits don’t increase every year post-FRA, it’s wise to start collecting as soon as your ex hits their FRA.

You may even be able to receive benefits from your ex-spouse if they are deceased, if you’re 60 or older (or 50+ and disabled), and have not remarried before age 60 (or 50 if disabled). 

Keep in mind that Social Security always wants you to get the highest payment available. So, if your work history qualifies you for a higher benefit, you’ll simply collect yours instead of the one from your ex. 

3. It might mean you can collect benefits from your late spouse.

Widowhood is unpredictable. But if you do have reason to believe that one spouse is likely to outlive the other, it can be possible to plan for that outcome. 

If the higher-earning spouse is the one likely to outlive the other, it can be beneficial for that higher earner to delay taking benefits as long as possible while they’re still alive. That way, the closer they get to 70, the bigger the eventual monthly benefit check to the remaining spouse will be. Of course, if this isn’t possible and you need the income sooner, don’t hold off.

Even if you haven’t planned for widowhood, you will still likely be able to receive benefits your spouse left behind. Typically, you’re eligible to take 100% of Survivor’s Benefits (as long as the deceased spouse reached their FRA). 

In some cases, if you have younger children or financially dependent grandchildren, they also may qualify for Survivor’s Benefits if you become disabled or die before the children are 18.

4. It might mean you take charge of someone’s benefits as a caretaker.

Whether you’re caring for a spouse that has become disabled or looking after an elderly parent, your primary relationship might be as a caretaker (especially if that position has kept you from working). 

If the person you’re caring for is receiving monthly Social Security benefits but is unable to manage their own affairs, you may qualify to become that person’s Social Security representative payee

To be approved, you’ll go through an investigation that determines you’re really the caretaker. You’ll usually have to provide proof of your identity and do an interview with a representative from Social Security (these were often in-person pre-COVID; now you may have the option to do an interview online or via phone). 

Once approved, you’ll have the authority to allocate their monthly funds toward their care. This includes making sure their needs like shelter, food, and medications are paid for and potentially depositing leftover money into interest-bearing accounts. These actions will all be done via that person’s bank account; you’ll have to maintain a separate one as part of the program.

You’ll also be responsible for keeping records about how the funds were spent and for reporting any life changes that could affect their benefits, like a divorce or death. 

The program is designed to make sure that a person’s true caretaker is in charge of their funds, and may help you rest easier if some of their care costs were coming out of your pocket. If you don’t want to take on this position but don’t know anyone else who can, Social Security also sometimes designates an organization or a social service agency to be a representative payee, too.

5. Like life, your benefits can always change.

Social Security understands that relationship statuses can change. You’re not locked in to one benefit path once you hit retirement age. If you’ve recently experienced a big life change like a marriage, divorce, or passing of a spouse, you can head over to Social Security’s website or give them a call to see if you qualify for different benefits.

Speaking of changes…

Every year comes with a few tweaks to Social Security. Here’s what you can expect to see in 2021:

  • Higher payments. 2021 checks are getting a 1.3% cost-of-living adjustment (COLA). That’s a little less than the 2020 COLA of 1.6%. For the average single person, that will be an extra $20 per month, for total checks of $1,543. The average married couple should see an extra $33 per month, for average monthly checks of $2,596. You should see that bump in your January payment.
  • Higher tax cap. Workers typically pay 6.2% of their earnings toward Social Security up to a certain cap. In 2021, that cap will rise by $5,100, to $142,800. That means you won’t be taxed toward Social Security on any earnings that exceed $142,800.
  • Earnings limit increase. Before you hit your FRA, you can earn $18,960 per year while collecting Social Security benefits without any of it being withheld, an increase of $720 from 2020. If 2021 is the year you’ll hit your FRA, you can start earning $50,520 without penalty, up from $48,600 in 2020.

Though there will be bumps in payment, it’s understandable if you’re still feeling pinched every month, since Social Security benefits tend not to rise with the true cost of inflation. 

If that’s the case, there are always steps you can take to get the most of your income and plan for the future. Your first step can be taking a look at our 2021 guides to retirement planning and optimizing your benefits, which walk you through all the different ways you can get the most out of the planning, saving, and benefit programs available to you.

Next, hit up Silvur’s Retirement Store. You’ll spot deals on everything from tax prep software to online fitness classes to grocery delivery, making it easy to save on the little things that make life a bit easier and more fun. With SilverSingles, a dating site designed exclusively for people 50 and older, you could even dip your toe into the online dating world and see if your relationship status gets a makeover.

Finally, don’t forget that you can always recalculate your Silvur Retirement Score in order to see how your current level of savings sets you up for the future. With good planning underway, you’ll be ready to enjoy everything that 2021 has coming your way.

Interested in more tips on planning, saving, and preparing for retirement life? Check out our blog here