Since its inception almost a century ago in 1935, the Social Security program is now providing a stable income to around 74 million beneficiaries. This insurance program was first introduced as a means of fighting elder poverty, however, retirees are not the only group who are able to qualify for monthly benefits. The Social Security Administration (SSA) pays several types of benefits to its beneficiaries.
There is the Old Age benefit, a Disability Insurance benefit, the Supplementary Security Income benefit, and Survivors Insurance benefits. The amount any beneficiary receives is highly dependent on how much they had paid into the program during their working years in the form of a dedicated payroll tax. If the individual who is paying into Social Security taxes happens to pass on before beginning to claim benefits, their remaining dependents will become eligible to claim these benefits. This is known as Survivor benefits and here is what you need to know.
Social Security Survivor benefits
Losing a family member is no easy task to navigate, particularly in an emotional sense. However, if the deceased had also been a breadwinner in the household, the financial ramifications will also weigh heavy on the bereft family. This is where Social Security Survivor benefits come into play, assuming that the deceased had worked and paid into the Social Security payroll taxes prior to their death.
According to the Social Security Administration (SSA), “you may qualify if you’re the spouse, divorced spouse, child, or dependent parent of someone who worked and paid Social Security taxes before they died.” Additionally, “you could get a monthly payment and may be eligible for Medicare based on the work history of the family member who died.”
Eligibility
Survivor benefits had been paid to around 5.8 million beneficiaries which is about 8.4 percent of the total beneficiaries, according to the SSA’s monthly statistical snapshot for June. During this month, the average Survivor benefit amounted to approximately $1,571. The amount a dependent will receive as their Survivor’s benefit varies from person to person since it is determined in relation to the average lifetime earnings of the person who has passed on.
According to the SSA, in order to qualify for Survivor benefits, the following requirements must be met:
Spouses and ex-spouses:
- Are age 60 or older, or age 50–59 if you have a disability, and
- Were married for at least 9 months before your spouse’s death, and
- Didn’t remarry before age 60 (age 50 if you have a disability).
Children:
- Unmarried, and
- Age 17 and younger, or
- Ages 18–19 and in school (K–12) full time, or
- Any age if they developed a disability at age 21 or younger.
The Survivor benefit is calculated as a percentage of the deceased worker’s benefit, however, the survivor’s relation to the deceased as well as the survivor’s age both factor in to this calculation.
For spouses or ex-spouses, the Survivor benefits are determined as follows as per the SSA website:
Payments start at 71.5% of your spouse’s benefit and increase the longer you wait to apply.
For example, you might get:
- Over 75% at age 61.
- Over 80% at age 63.
- Over 90% at age 65.
“You can get up to 100% when you reach your Full Retirement Age for Survivor benefits (between ages 66–67)” and “children will automatically get 75% of the benefit in most cases, however, a “family limit” also exists which limits the amount a family can receive. A one time lump sum payment of $255 is sometimes given to children or spouses as well.”
It is also important to note that two types of benefits cannot be collected at the same time. If, for instance, you are aged 65 or older and as a result, you now qualify for both retirement benefits as well as a survivor benefit, you will only receive the higher paying check of the two. In this regard, being strategic with your Survivor benefit claims can also be beneficial since, as a spouse, delaying claiming until your full retirement age can earn you 100% of the deceased’s benefit instead of 75%.