How Divorce Affects Your Social Security Benefits

Because Social Security is the No. 1 income source for retirees in our country, a divorcing person should consider how his or her benefits will be affected. 10-17-16-divorce-socialsecuritybenefits-andersenlawpc

Before diving into the effects of divorce on these benefits, it makes sense to do a quick review on the basics of the benefits themselves.

YOUR WORK BENEFITS: Your benefits will depend on how much you earned over your working career and the age at which you apply for benefits. At age 62, each year’s earnings are tallied and indexed for inflation. The highest 35 years of earnings are totaled and indexed for inflation then averaged to compute your “AIME.” This amount is divided by bend points to determine your PIA (primary insurance amount) which you will receive and adjust with a cost of living adjustment over time. If you apply early, you will receive a percentage of your PIA depending on the month of retirement. To calculate your benefits, you can go here and click on “estimate your retirement benefits” or click here. Continue reading “How Divorce Affects Your Social Security Benefits”

Key Facts About Social Security

Social Security gets a bad rap, but in truth, it is the single largest source of income among those 65 and older. According to the Employee Benefit Research Institute and Matthew Greenwald & Associates, Social Security is the primary source of income for 69 percent of retirees.

The media loves to present flashy headlines about Social Security, but they often get their information wrong or present an extreme example without a Andersen-Law-Social-Securitybalanced explanation. Social Security facts are based on reliale sources, not flip comments meant to alarm viewers or readers.

In order to better serve my clients, I regularly attend trainings on issues affecting my clients. Because of my focus on elder law, one of those areas is Social Security. Here is some of what I learned at the latest update on Social Security. Continue reading “Key Facts About Social Security”

Social Security: The End of “File and Suspend” 

When spouses both receive Social Security Benefits, they have an incentive to maximize the benefit of the lower lifetime earner by allowing him or her to receive spousal benefits based on the higher lifetime earner.

On the other hand, the married couple also has an incentive to postpone the higher earner’s election to receive Social Security so that they get the maximum benefit. An election at the age of 62 years will be at a lower percentage than the full benefit at 67 years of age.

Social Security - End of File & Suspend Andersen Law

Here’s the rub: the lower earner cannot elect spousal benefits until after the higher earner elects. That creates a dilemma: do you have the higher earner hold off to maximize benefits thereby forfeiting the lower earner’s right to the higher spousal benefits OR do you have the higher earner forfeit full benefits in order to let the spouse get spousal benefits? Continue reading “Social Security: The End of “File and Suspend” “