Ask Larry
As we speak’s column addresses questions on whether or not earlier price of dwelling allowances (COLAs) apply to spousal advantages taken later, whether or not earlier COLAs apply to widow’s advantages and taking incapacity advantages earlier than widow’s advantages. Larry Kotlikoff is a Professor of Economics at Boston College and the founder and president of Financial Safety Planning, Inc.
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Have Social Safety questions of your personal you’d like answered? Ask Larry about Social Security here.
Will My Spouse Get Earlier COLAs When She Takes Social Safety Spousal Advantages?
Larry, Your column is nice! Wonderful info! My spouse is eight years older than me. She claimed her lowered retirement advantages at 62. The spousal profit for her will probably be increased than what she is now getting. I plan on making use of for for my retirement advantages at 70. She will probably be 78 after I apply. Will she be entitled to the eight COLA will increase when she applies for spousal advantages?
I do know she will not get the delayed retirement credit however I am unsure in regards to the COLAs. And can her spousal profit be half of mine or will or not it’s lowered? Thanks, Mark
Hello Mark, The reply to your query about COLAs is sure, however I ought to make clear. Your spouse’s unreduced spousal charge could be calculated by subtracting her major insurance coverage quantity (PIA) from 50% of your PIA. An individual’s PIA is the same as their Social Safety retirement profit charge if they begin drawing their advantages at full retirement age (FRA).
And since PIAs are up to date yearly to mirror Social Safety price of dwelling (COLA) will increase, your spouse’s future spousal charge will embrace the COLAs that happen between now and if you begin drawing your advantages.
And also you’re proper that the delayed retirement credit (DRCs) utilized to your retirement profit don’t improve her spousal profit. However be aware that since she filed for her retirement profit earlier than her full retirement age (FRA), her spousal profit will probably be lowered beneath 50% of your PIA.
My firm’s software program — Maximize My Social Security or MaxiFi Planner — will precisely calculate your and your spouse’s advantages charges. You may mannequin taking them at particular dates to find out precisely what they’d be so you can also make knowledgeable selections about when to file to your advantages. Social Safety calculators offered by different firms or non-profits could present correct options in the event that they had been constructed with excessive care. Greatest, Larry
Would My Widow Obtain The Quantity That I Was Receiving After I Die, Or That Quantity Plus Subsequent COLAs?
Hello Larry, I am 20 years older than my spouse. As an instance I wait till I’m 70 to start out amassing my Social Safety retirement profit after which move away at 71. When my spouse reaches full retirement age, does she obtain the advantages I used to be receiving after I handed, or does she obtain that quantity plus COLA for the 15+ years between after I handed and when she applies for her widow’s advantages? Thanks, Stan
Hello Stan, In case your spouse waits till her full retirement age (FRA) to say widow’s advantages, she would obtain your full profit charge inclusing the delayed retirement credit (DRCs) you earned by ready till 70 to start out drawing, plus any Social Safety price of dwelling allowances (COLAs) that happen after your demise.
In different phrases, her unreduced widow’s charge could be equal to the quantity that you’d have been drawing for those who had been nonetheless dwelling on the time your spouse applies for her widow’s advantages. Simply to be clear, although, your spouse could not obtain your full charge and her personal advantages concurrently, simply the upper of the 2 quantities. Greatest, Larry
Will I Be In a position To Maintain My SSDI And Additionally Get Advantages From My Husband’s File?
Hello Larry, I have been on SSDI since 1995 and I solely obtain ~$275 a month now. I am 60 now and my husband simply handed away at 79. He began his Social Safety retirement profit at 62. He was receiving about $1,025 Will I have the ability to maintain my SSDI and in addition obtain a widow’s profit? Thanks, Val
Hello Val, I am sorry to your loss. Sure, you’ll be able to probably maintain drawing your Social Safety incapacity (SSDI) advantages and in addition qualify for widow’s advantages. The precise quantity of widow’s advantages that you possibly can now obtain will depend on your precise age and the quantities of your and your husband’s major insurance coverage quantity (PIA). An individual’s PIA is the same as their Social Safety retirement profit charge if they begin drawing their advantages at full retirement age (FRA), or their full SSDI profit charge.
In case you’re drawing your personal SSDI advantages and for those who apply for widow’s the month you flip 60, your widow’s charge would quantity to 71.5% of the distinction between your PIA and your husband’s increased PIA.
The share could be a bit increased for those who’re someplace between ages 60 and 61 if you begin drawing widow’s advantages. In any case, although, because you’re already drawing SSDI it could be advantageous to say any widow’s advantages for which you qualify as quickly as attainable.
Any discount for age relevant to the widow’s charge of an individual who was eligible for SSDI advantages previous to receiving widow’s advantages is eliminated when the widow reaches full retirement age (FRA). Due to this fact, it feels like there could be no draw back to claiming your widow’s advantages ASAP.
It’s essential to file an software with Social Safety with a view to declare widow’s advantages. If you have not already executed so you may have to provoke that course of by calling Social Safety at 800-772-1213. It normally takes Social Safety roughly 30 and 60 days to course of a declare for widow’s advantages, however that time-frame can range. Greatest, Larry