Corrections & Clarifications: An earlier version of this story misstated who is eligible to file a restricted application for Social Security.
As benefits go, few compare with those offered by Social Security to spouses.
Consider this: Even if you've never worked under Social Security, you may be able to get spouse’s retirement benefits if you are at least 62, and your spouse is receiving retirement or disability benefits. And if you're divorced, you may still be able to get benefits on your ex-spouse's record.
As easy as all that sounds on paper, experts say there’s much that spouses don’t know about these benefits, like how much they will receive and how to apply. To learn more, read about the benefits on the Social Security Administration's website: https://www.ssa.gov/planners/retire/applying6.html.
Given the lack of knowledge out there, experts say spouses make plenty of mistakes when claiming Social Security.
What are those mistakes and how can they be corrected or avoided?
Old rules vs. new rules
Married or divorced, women who were born before Jan. 2, 1954, can still file something called a restricted application. Doing that allows them to claim a spousal benefit while letting their benefit based on their own record of earnings grow. A new law enacted in 2015 prohibits those born on or after Jan. 2, 1954, from using the restricted application.
But Jim Blankenship, a certified financial planner with Blankenship Financial Planning and author of "A Social Security Owner's Manual,"says that women – married or divorced – who fall under the old law are either being told or assume that they aren't eligible for spousal benefits. They're making that assumption because their own benefit is something more than 50 percent of the spouse's – or ex-spouse's – benefit.
Blankenship says these people can still file a restricted application once they've reached full retirement age and if the other spouse has filed (married), or if they're independently entitled (divorced), and then delay their own benefit to a later date.
Don’t file early and keep working
According to Blankenship, filing early at 62 while still working could result in you giving up most or all of your Social Security benefits due to earnings limits. If you are under full retirement age for the entire year, the Social Security Administration deducts $1 from your benefit payments for every $2 you earn above the annual limit. For 2018, that limit is $17,040. Read more about this on the Social Security Administration website: https://www.ssa.gov/planners/retire/whileworking.html.
Blankenship says “you will get credit for the withheld benefits at full retirement age, but they have additional headaches of paperwork – and confusion – in the meantime, for very little, if any, benefit to them.”
Maximize joint lifetime benefits
The objective is seldom to maximize spousal benefits, says William Reichenstein, head of research at Social Security Solutions. “Rather, it should be to maximize joint lifetime benefits,” he says. “It does not always pay to file today for the higher of spousal or retirement benefits. Moreover, the husband and wife’s claiming strategies should be coordinated.”
Others concur. Filing early or late just by rote, rather than using a "one spouse early, the other late" strategy to optimize benefits is another – potential – mistake, says Blankenship.
Wait to get divorced
You qualify for divorced benefits if you were married for 10 years, says Andy Landis, author of "Social Security: The Inside Story."
“So, if you're about to sign divorce papers close to that point, don't sign until your 10th anniversary,” he says. Read "What Every Woman Should Know" from the Social Security Administration: https://www.ssa.gov/pubs/EN-05-10127.pdf.
Kurt Czarnowski of Czarnowski Consulting says that many divorced spouses mistakenly think that their ex-spouse must be collecting Social Security before divorced spousal benefits can be paid.
“Now, this is definitely true for spousal benefits, that is, if the marriage is still intact,” he says.“But, as long as both individuals are at least age 62 and the divorce was finalized at least two years in the past, divorced spousal benefits can be paid even if the ex has not yet started to collect.”
Of course, all the other requirements for divorced spousal benefits must be met, as well, says Czarnowski. Read about it on the Social Security Administration website: https://www.ssa.gov/planners/retire/divspouse.html.
Are you widowed?
If your spouse – or former spouse – is deceased, be sure to check out Social Security survivor benefits. “That could be your best payment,” Landis says.
Also, if you're "dually eligible" for your own Social Security plus widow's benefits, consider the timing of the two claims to maximize your lifetime payout. “Timing can make a huge difference in your retirement security,” he says.
And, if you are widowed and considering remarriage, try to wait until you're 60. “That will keep the door open to survivor payments from your deceased spouse, even while remarried,” Landis says.
Robert Powell is the editor of TheStreet’s Retirement Daily www.retirement.thestreet.com and contributes regularly to USA TODAY. Got questions about money? Email Bob at firstname.lastname@example.org.