Social Security When a Spouse Dies

[JerryS109]

I am actually trying to figure out two things, one of which is related to the SS death benefit. First, I am working through the Spousal Benefit (different than the SS benefit when a spouse dies). I am figuring out the difference between my wife applying for benefits before her full retirement age (FRA) and at FRA. In the process of working through that, I was looking at the way SS works when a spouse dies. 

Now ... the point of my question. I were to die before my wife, then she would receive some percentage of my SS benefit (e.g. between 71% and 100%). I thought (perhaps mistakenly) that if my wife claimed her own SS benefit before reaching FRA she would receive less of my benefit when I die. However, I just read an article on the AARP web site that explains survivor benefits. In that article, it says:

• If you claim survivor benefits between age 60 and your full retirement age, [emphasis added] you will receive between 71.5 percent and 99 percent of the deceased’s benefit. The percentage gets higher the older you are when you claim.

This seems to say, if I die and my wife is between 60 and FRA, then she gets a reduced survivor benefit (between 71.5% and 99%). 

So, finally, my actual question is: If my wife claims her own SS benefit before FRA, does that reduce her survivor benefit when I die (assuming my wife is beyond FRA when I die)?

Thanks!

[fffred]

@JerryS109 

Let me add that the survivor may be entitled to any "delayed retirement credits" earned by the worker through not taking their benefit until after their FRA (but spousal benefits are not entitled to the DRCs).

For example, I took my SS at age 70 with a DRC of 1.32 (4 years getting an increase in benefit of 8% per year (not compounded)). If my wife is at her FRA or older when I die she will get my SS benefit including that additional 32%. But if she is younger than her FRA when I die her survivor's benefit will reduced based on her age, but the reduction factor is applied to my total benefit including the DRC amount.

I have a chart where I calculated the reduction factor for each year of her age from 60 to 67 (60 is the minimum age to collect survivor benefits unless some other circumstances exist, and up to her FRA), then multiplying that by the DRC factor of 1.32. This results with her getting about 95% of my PIA if her age at my death is 60, 99.7% of my PIA at her age 61, increasing each year until at age 67 she gets the full 132% of my PIA. And of course, these values are subject to change when the trust fund depletes in 10 years or so and everyone may have to take a haircut.

I didn't want to leave a poor widow.

[fffred · Accepted solution]

@JerryS109 

Short answer:  No, her spousal benefit does not alter her survivor benefit. Any reduction in spousal benefit due to age (below FRA) does not apply to or affect her survivor benefit.

I had pondered this exact question for a number of years. I was told that if my wife took spousal benefit prior to her FRA that her age at that time would not affect how her survivor benefit was determined: in other words, if her spousal benefit was subject to a reduction due to her age then this situation would not determine her survivor benefit in any way, (1) if she later collected a survivor benefit before her FRA then the reduction in benefit would be based on her age at that time, or (2) if I died after she was at her FRA then there would be no reduction in her survivor benefit.

That's what I was told 8 or 10 years ago and for a couple years now I have been trying to formally define this using the rules of the SSA; I didn't want to blindly trust internet forums and media articles. It has been difficult to find the particular SSA rules that would address this case but I think they are there.

But first, I'll point you to a thread from only a week or two ago where this same question was asked and I replied. See https://community.aarp.org/t5/Social-Security/Husbands-delayed-retirement-benefit/m-p/2489117

I will add to my discussion in that thread with a few additional remarks. 

(1) The "deemed filing" rules do not apply to survivor's benefits. This is stated in SSA POMS # GN 00204.035 Deemed Filing on the SSA site at https://secure.ssa.gov/poms.nsf/lnx/0200204035. See the second paragraph (below the bullet points) under Section B. "Deemed filing does not apply to survivor benefits."

(2) POMS # RS 00207.005 Widow(er)'s Benefits - Conversion of Benefits - Policy, addresses conversion of spousal benefits to survivor's benefits. Section C states "When a claimant is entitled to spouse's benefits as a legal spouse and notice is received that the number holder (NH) died, both benefits are terminated." See https://secure.ssa.gov/poms.nsf/lnx/0300207005

The conclusion from these two rules are that the clock resets once survivor benefits begin. No prior claiming or age at claiming is relevant. So if the spouse, now survivor, is below their FRA and they take survivor benefits the benefit will be reduced for their age at that time (and the reduction factors are not identical to the spousal reduction factors) or if they are now at their FRA or older there is no reduction in benefit regardless if the spousal benefit had been reduced or not.

(3) Spouses (survivors) who have their own SS retirement benefit and yet are collecting a spousal benefit may elect (even in these days of the deemed filing rule) to put the survivor benefit in abeyance until FRA and meanwhile collect only their own work benefit. My own spouse cannot take advantage of this special rule since she has no work history and in this case the rules do not permit postponing the survivor benefit. I don't recall the form number at the moment but I could if asked. Some survivors might benefit from this rule. And I suppose the reason that it still works now is because that one POMS states that deemed filing doesn't apply to survivor benefits.

Good luck!

Edit to add:  I would have thought this was an easy question. Certainly there must be hundreds of people actually in this situation. If not thousands or even hundreds of thousands. A few million even! But I have seen little discussion of this. A few years ago I even joined a "widow/widower" group on Facebook, certainly those folks would know! But I never saw any discussion of this question; I recently asked it there myself and got replies from only 2 people and they didn't really know the answer. I then called the SSA and asked them and was given a lot of garbage. At that point I wrote to Ask Larry and got what is, to me, a pretty much definitive answer. I have found discussion in a few other sources, a scholarly legal reference book and some other sources. But still my mind wants to see it clearly documented in the SSA POMS or the CFR. But I think the two POMS discussed above are enough to create the logic trail.

[JerryS109]

Thanks, @fffred for the comprehensive answer. It might take me a few minutes to digest the SS documents for which you provided links. But your answer and the answer provided in the "Ask Larry" link I think hit the nail on the head. I have my answer.