PLAN FOR ONE BUT LIVE AS TWO -

[GailL1]

Once again this week, I am seeing individual beneficiaries living in a marriage, each with their own benefits, being devastated financially when one of them dies.

I do not know where they get the idea that the living spouse will get both benefits - THEY DO NOT - the living spouse will receive a Survivors benefit that equals the higher of the two benefits.  That still means that the sum of the Survivor receives is less than the (2) individual benefits which they got before the death of their spouse.

This could mean the loss of several hundreds of dollars a month.  If the couple is living on a very tight budget, this loss of income could result in unintended consequences -

So, please do a bit of planning if you think this situation might affect you.  

[RN362636]

Unfortunately, it is exactly this sort of situation that is causing many elders to become homeless. People over 60 years old are the fastest growing homeless population today. When you see a homeless elder don't assume that they are a drug addict or alcoholic, many are not. 

[GailL1]

@RN362636 

Of course, plenty of homeless are not addicts or alcoholics - they just lack the education, knowledge or ability to understand what happens when . . . . . 

and they have no-one to help them or they don’t seek anyone to help them make determinations of their predicament - lifelong or when something happens like the loss of a spouse and they lose income due to this.  

This does not just happen when one is old - many times it is a life long event.  Women (1/2 of the union) who never get involved in the finances of the unit. Not understanding legal documents like mortgages or liens and what happens.

Sometimes I get really tired of people saying to me . . . “well, somebody told me . . . . “  that is not something to build a life upon.  

[RN362636]

I agree with you. Many lack financial literacy and it can make life difficult. Unfortunately, it often isn't taught at home because the parents lack the knowledge themselves. It isn't taught in schools because it isn't seen as a priority; it isn't required in college and many don't attend college. The question is who should educate people and when should it begin? I personally believe that it should begin in the public school system. Begin with the basics...how to open a checking account, the importance of building a credit score, how much credit card debt actually costs, etc. As kids mature teach something about investing for their future, how social security works, etc. At least it would be a place to start the conversation.

[SereneSeagull]

Same goes for homeless vets. Your mentioning to not assume a homeless person is an addict, @RN362636   I fought with someone on social media who couldn’t stand the homeless, thought they were drunks or addicts..  she Claimed to be a Christian. Was a staunch 47 red-hatter. USA all the way… When I informed her that many times a homeless person was a Vet.  Nothing but crickets.

[papawofboo]

If check comes on 10th and person passes on 15th.

How many checks after someone passes do you get to keep? 

[GailL1]

@papawofboo 

If it done in that type of time period - where the check comes before the death - then that particular one should be fine.  However, you never know what the bank that received the money might do - because they are informed of the death and may not pay attention to the date of deposit relative to the death and send it back for the SSA to take care of - since they don’t want to get in trouble with the SSA.   But it can be easily rectified under whatever situation.

The rule is and would always apply - a Social Security benefit check (or ever how it is received) can NEVER be paid to a deceased person. So all benefits to the deceased STOP at death.  But that does not mean that the heirs are not due the money.  

SSA can not pay a deceased person so it will be clawed back. After that occurs the benefit can be filed for via:  

SSA.gov - Form SSA-1724 | Claim For Amounts Due In The Case Of Deceased Beneficiary | SSA

The benefit amount will be reissued to the heirs in the order indicated:

• The surviving spouse who was either living in the same household as the deceased at the time of death or who, for the month of death, was entitled to a monthly benefit on the same record as the deceased;
• Children who, for the month of death, were entitled to a monthly benefit on the same record as the deceased;
• Parents who, for the month of death, were entitled to a monthly benefit on the same record as the deceased;
• A surviving spouse not qualified under 1. above;
• Children not qualified under 2. above;
• Parents not qualified under 3. above; or
• The legal representative of the deceased person's estate.