Divorce is no longer the socially divergent issue it may have once been, nor is it only an endeavor for the young. In fact, recent studies and statistics make it clear the opposite is true: millennials across the U.S. are getting married and divorced at much lower rates than their parents and grandparents. Baby Boomers and others of the older persuasion are driving rates of “Gray Divorce” ever higher.
As we’ve discussed on our blog, rising rates of gray divorce are a trend that many experts and attorneys don’t see slowing up any time soon, in Texas or across the nation. As family law attorneys, the influx of gray divorcees in recent years has driven a lot of our familiarity with the unique concerns and particular issues older spouses face when they dissolve a marriage.
Some of these issues include things like:
- Retirement accounts and pensions, which are divisible in a Texas divorce.
- Potentially limited income as many involved in gray divorce are approaching retirement, have medical issues or specific needs, may lack work experience, and are likely to have other financial issues and future concerns.
- Determining how the length of a marriage (especially for longer marriages), size of a marital estate (which can grow and accumulate assets as spouses age and make for high-net-worth cases), and other similar factors impact matters of asset and debt division, support, and more.
- Issues regarding estate planning, adult children, mental health and competency, cohabitation, and death during or after divorce.
These issues can become increasingly critical areas of focus for men and women who divorce at an older age. That’s especially true for financial matters, as older divorcees may be more keenly aware of how economic shake-ups can threaten their financial stability at a time when they may have greater needs, fewer resources, or the simple desire to enjoy their golden years. However, money and the future are concerns had by divorcing spouses of all ages – and though it may not be the first issue they think of, that can also include Social Security.
Social Security & Spousal Benefits
When people talk about Social Security and divorce, they typically refer to Social Security retirement benefits, which are the benefits you’re able to collect once you reach a certain age. Though things like Social Security Disability (SSD) benefits may be an important consideration in divorces involving a disabled spouse, they’re not as common as retirement benefits.
Whether you’re younger or older, Social Security offers a means to enhance whatever nest-egg, savings, and financial tools you’ve accumulated and grown over the years. It also offers a type of safety net for those who haven’t been able to save much else.
Ultimately, Social Security is a vital piece of the retirement puzzle, especially if you’re ready to exit the workforce, and maybe even if you’ve never worked before. That’s because non-working spouses may be entitled to spousal benefits. Here are few common questions and answers to help explain.
1. How Do You Qualify for Social Security?
Social Security doesn’t just come from out of the blue. You’ve paid into it during your working life, and when you retire, you’re entitled to receive Social Security benefits based on how much you’ve paid (through your income taxes) over the years. That means you must have worked long enough, and paid enough in Social Security income taxes, to obtain the needed number of “credits” to receive benefits.
The “credits” criteria puts some individuals who’ve never worked or earned meaningful and consistent taxable income at a disadvantage. Stay-at-home parents, for example, may not have paid much, if anything, into Social Security if they gave up careers to raise children while their spouse worked and provided financial support. In such a situation, it is possible for people who would not otherwise qualify for Social Security to receive benefits through their spouse or ex-spouse’s work history.
While every case is different, the following must generally apply in order to qualify for Social Security if you are seeking benefits under an ex-spouse:
- You are 62 or older;
- You are not married;
- Your marriage lasted for at least 10 years;
- Your ex-spouse qualifies for Social Security retirement (or disability) benefits; and
- You have been divorced for at least 2 years (if your ex has not yet applied for benefits).
Generally, divorcees who meet these criteria can collect half of their ex-spouse’s benefits. However, there may be some exceptions:
- Death - In marriages where one spouse earned the lion’s share, it may make more sense to seek benefits under an ex-spouse rather than your own employment history. The SSA permits collection of spousal benefits in cases of a deceased former spouse at age 60, or at age 50 if applicants also meet the SSA’s definition of disabled.
- Remarriage – “Non-earning” spouses are able to collect spousal benefits even if their ex-spouse, the earning spouse, has remarried. However, if they themselves enter into a new marriage, they would not typically be able to collect Social Security under their previous spouse, unless the subsequent marriage ends in death or divorce.
- Remarriage and death – In situations where a non-earning spouse remarries, and their new spouse dies after at least 9 months, they may choose which of their two former spouses to collect from. The first marriage must still meet all applicable criteria.
- Children – Children of divorced parents may receive benefits based on their parent’s work history, provided they are under 18, under 19 and still in high school, or over 18 and legally disabled. The surviving divorced parent may also receive a benefit for raising a child under 16.
2. Is Social Security Divisible in Divorce?
Under Federal law, Social Security is not divisible in divorce like the tangible items a couple owns (such as a car or marital home) or their financial assets (such as retirement accounts). Though it may not be an immediate concern in a divorce case, it doesn’t mean it’s not a concern at all – there may still be reason to address Social Security during divorce. In fact, whether you qualify for Social Security or are a non-earner who needs to qualify under a former spouse, such benefits are something which can influence how other assets are divided, and how a divorce is ultimately resolved.
Consider this example: If you’re in a tough financial position because you lack the job skills, experience, and work history to find gainful employment and have little else to turn to following a divorce, there’s reason to more closely consider how Social Security benefits play a role. That’s especially true when it comes to resolving property division or spousal support settlements.
It should also be mentioned that while Social Security isn’t divisible in divorce, pension benefits received in lieu of Social Security are.
3. What if I Am Entitled to Social Security, But It’s Not Enough?
If you do have work history and are entitled to Social Security, you’ll need to compare the benefits you’d be eligible to receive with any spousal benefits to which you may be entitled. Generally,
- You’re eligible to receive 50% of your former spouse’s Social Security benefits, (or the entire amount if they’ve passed away).
- If you choose to retire and begin collecting benefits earlier than the full retirement age (67), the benefits you’ll receive will be reduced accordingly.
- If you work while receiving benefits, they may be reduced based on a retirement earnings test.
Under new laws, you will be paid benefits based on your own record first. If the benefit on your former spouse’s record is higher, you will receive additional benefits under your ex-spouse so your total benefit is equal to the highest amount.
4. Do I Need My Ex-Spouse’s Permission or Have to Wait for an Ex to Collect Benefits?
If you wish to apply for Social Security benefits under an ex-spouse’s work history, you do not need their permission before you’re able to file. Whatever you receive also has no effect on their benefits. In most cases, you also do not need to wait for an ex-spouse (particularly one who is younger) to begin collecting benefits before you can apply for spousal benefits under their work history.
Helping You with Social Security Matters in a Divorce
Social Security is an all-too-often forgotten piece of the retirement puzzle, and an often-overlooked issue by many who are just considering divorce or starting the process. At Coker, Robb & Cannon, Family Lawyers, our team is led by Board Certified Family Law Specialists (Duane L. Coker, Kelly K. E. Robb, and Jacqueline Cannon; Texas Board of Legal Specialization), talented attorneys, and a team of caring paralegals and support staff. We take the time to address the comprehensive needs of our clients, as well as concerns and issues which will affect them for years to come.
Do you have questions about Social Security in your own divorce case? Would you like to learn more about working with our legal team to begin your family law journey? Call (940) 293-2313 or contact us online. We proudly serve clients throughout Denton County, Collin County, and beyond.