Thinking about your own death isn’t fun but it’s a reality you have to consider when crafting a financial strategy. Understanding how Social Security survivor benefits work can help you make several other crucial decisions. From considering your options when electing a FERS survivor benefit to purchasing life insurance, Social Security is a key element of retirement planning for federal employees.
When Can A Surviving Spouse Collect A Survivor Benefit?
A surviving spouse is entitled to 100% of their deceased spouse’s Social Security benefit when they reach their own full retirement age (FRA). Although they can collect a survivor benefit as early as age 60, it will permanently reduce the amount of their monthly payment by approximately 30%.
A surviving spouse is also entitled to a lump-sum, $255 death benefit as soon as a spouse’s death is reported. The $255 death benefit does not affect the amount of the survivor benefit.
“Before one spouse passes away, a couple has two Social Security payments added to their monthly household income. After one spouse passes, there’s only one payment.”
A Surviving Spouse Can Only Collect One Benefit
If your spouse is receiving a Social Security retirement benefit at the time of your death, they can’t collect double benefits as both a retiree and a survivor. Social Security determines which of the two benefits is higher and sends your spouse that amount.
As you can see, this is a critical issue when planning your retirement. Before the death of a spouse, a retired couple has two Social Security payments added to their monthly household income. After one spouse passes, there’s only one payment. Even though the surviving spouse receives the higher of the two amounts, their household income is considerably less than before.
How Divorce And Remarriage Affect The Survivor Benefit
As long as a marriage lasted at least 10 years before a divorce, an ex-spouse can collect a survivor benefit based on the former spouse’s work record. Keep in mind this will not affect the survivor benefit a current spouse is entitled to receive. However, if a former spouse remarries before age 60, they are no longer eligible to receive a survivor benefit based on an ex-spouse’s earnings record.
How Social Security Works With A FERS Survivor Benefit
One of the decisions you need to make when applying for your federal retirement is electing a FERS survivor benefit for your spouse. Should you choose a 25% or 50% survivor benefit? Or, none at all. Understanding how much your surviving spouse can expect to receive in Social Security survivor benefits can help you make an informed decision. To learn more, connect with an FRC® trained advisor.
