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Does divorce affect Social Security benefits?

On Behalf of | Aug 11, 2021 | Uncategorized

Numerous North Carolina residents worry if they’ll have enough money in retirement. If you are nearing retirement years and preparing to end your marriage, you may find yourself even more concerned about your financial position, as well as wondering if retiring when you want is still an option. While you and your spouse will have to equitably divide your assets, which generally includes funds in your retirement accounts, there is one retirement benefit you may not have to worry about splitting with your spouse — your Social Security.

Social Security has a spousal benefit that is intended to offer financial support to spouses who have not worked or earned less than their marital partner over the years. The payment of this benefit doesn’t work the way most might think. You will still get your full Social Security benefit.

How do Social Security spousal benefits work?

Rather than taking money out of your benefits, your spouse, or former spouse, applies for Social Security on their own. If their benefit is less than half of yours, they can opt to take the spousal benefit instead, which is equal to roughly 50% of the amount you’ll receive in Social Security.

Confused? Thats okay. Here’s an example. Say your spouses Social Security benefit is $1,000 a month at full retirement age based on their work record, and yours is $3,000 a month. Rather than take the $1,000, they can claim the spousal benefit, which would be about $1,500 a month. You still receive your full amount, and they get a little more every month than they would on their own.

Who qualifies for the spousal benefit?

The Social Security spousal benefit is not available to just anyone who’s been married to a higher-earning spouse. There are rules in place to ensure no one abuses this benefit, such as the marriage must have lasted a minimum of 10 years, and an ex-spouse who gets remarried is ineligible for the benefit. If an ex-spouse claims the spousal benefit and later remarries, they’ll lose the benefit.

One less thing to worry about

The good news is, Social Security is generally one less thing you have to worry about when it comes to dividing assets in your divorce. When it comes to everything else, with the right help in your corner, you can negotiate or litigate settlement terms that are fair and equitable, and keep your retirement dreams in mind.