Our estate planning attorneys receive a lot of questions regarding social security survivor benefits. To shed some light on the process, we’ve put together the following guide.
If a person with social security benefits dies, leaving behind a surviving spouse or dependent child, the person left behind is entitled to receive two types of social security benefits: a one-time lump-sum death benefit, or a monthly survivor benefit. When it comes to later-in-life planning, knowing what you are entitled to can help ensure that you are not missing out on anything. According to the Inspector General of the Social Security Administration’s Office, more than 11,000 widows and widowers are receiving lower social security benefits than they are entitled to. Make sure you know your claim options so you don’t become one of those statistics.
WHO IS ENTITLED TO RECEIVE SURVIVOR BENEFITS?
Survivor benefits are paid out to the spouse of the worker who has died. To be eligible, you will need to have been married for at least nine months. Qualified children are eligible to receive the survivor benefits as well as ex-spouses, if the marriage lasted for more than 10 years.
Two Types of Social Security Survivor Benefits: Lump Sum and Ongoing Monthly Payments
LUMP SUM DEATH BENEFIT PAYMENT
If the spouse of the worker who has died is living in the same household, they are entitled to receive a one-time payment benefit of $255. In cases where there is no spouse left behind, a dependent child, under the age of 18, can receive the lump-sum death benefit. If it has been determined that the deceased worker was currently insured, the lump-sum death payment is payable as long as at least six quarters of the workers’ earnings were covered by social security during the 13-quarter period leading up to their death.
ONGOING MONTHLY DEATH BENEFIT PAYMENTS
Monthly survivor benefits are paid to widows/widowers, dependents, and minor children. To qualify for ongoing monthly death payment options, Social Security will need to be notified at the time of the workers’ death. Generally, benefits start from the time the application is received, rather than the time of the individual’s death.
SPOUSAL DEATH BENEFIT PAYMENTS
If you are the surviving spouse, you are entitled to receive 70-to-100 percent of what the deceased worker would have received when they reached their full retirement age. The deceased workers’ current spouse, aged 60 or older, is entitled to receive a lifetime monthly income in the form of social security survivor benefit, as long as they had been married for at least nine months.
For ex-spouses of the worker, if they were married for more than 10 years and remained unmarried until the age of 60, they are also eligible to receive the lifetime survivor benefit. Individuals who remarry and divorce again might also qualify.
RETIREMENT BENEFITS AND SURVIVOR BENEFITS
If a person has their own retirement benefits, they might think they are not eligible to receive the survivor benefit as well, and this is where many people miss out. Although you can’t receive both benefits simultaneously, you can take them serially. Knowing this little tidbit of information can help increase your lifetime income substantially. The other key is to take whichever benefit is the lower one right away and switch over to the higher one when you reach full retirement age. Another piece of information that many people don’t know is that to use either of these switching strategies, you have to only apply for one benefit initially; otherwise, you might not be able to switch if you are considered to have applied for both benefits at the same time.
It is an unfortunate thing when widows, widowers, and dependent children miss out on benefits they are entitled to because they were unaware, uninformed, or make a mistake during the application process.