Mary Beth Franklin: Why the merry widow is so darned merry

Seniors involved in later-life romances sometimes choose to live together rather than remarry in order to preserve pension benefits of a former spouse or to avoid becoming responsible for the debts of their new partner, including long-term care costs.

But cohabitating simply to maintain Social Security benefits of a deceased mate—or even a departed ex-spouse—is unnecessary in most cases.

Surviving spouses can collect benefits as early as age 60 (or 50 disabled), but the amount will be reduced substantially compared to collecting survivor benefits at full retirement age.

The same rules apply to divorced spouses who were married at least 10 years. In most cases, divorced spouses are not entitled to Social Security spousal or survivor benefits of an ex if they remarry. But there’s an exception for those who wait until age 60 or later to remarry—and it’s fascinating!

At 66, the full retirement age for survivor benefits for those born from 1945 through 1956 (which are slightly different birth years than those for full retirement benefits), a surviving spouse or ex-spouse or is entitled to 100% of what the deceased worker collected—or was eligible to collect—at the time of his or her death.

But if a widow or widower collects survivor benefits at soon as possible at age 60, the benefit would be reduced to 71.5% and the survivor would be subject to the earnings cap if he or she continued to work while collecting survivor benefits. If eligible, a survivor can switch to his or her own retirement benefits any time between age 62 and 70.

Generally, a divorced spouse loses Social Security benefits of an ex-husband or ex-wife upon remarriage. But there’s an exception if the ex-spouse dies and the surviving divorced spouse waits until age 60 or later to remarry. The ex widow or widower can continue to collect survivor benefits, assuming they are larger than any other benefit he or she is entitled to on her own work record or as the spouse of a new mate.

Many financial advisers are familiar with these basic rules of survivor benefits and remarriage, but there’s a wrinkle that I just learned about and I have to thank an Investment News reader for bringing it to my attention.

Frank, a financial adviser in Ft. Lauderdale, encountered this situation with one of his clients.

A divorced woman, who was collecting survivor benefits on her ex-husband’s earnings record, decided to remarry at age 66. The man she planned to marry was also divorced. He had wisely filed a restricted claim for spousal benefits only on his ex-wife’s earnings record and planned to delay collecting his own retirement benefit until it was worth the maximum amount at age 70.

So we know the surviving ex-wife can continue to collect survivor benefits because she waited until after age 60 to remarry. But the big question is whether the new husband would lose his spousal benefit based on his ex-wife’s earnings record because he remarried?

I contacted the Social Security Administration (SSA) for the answer. It turns out, the new husband will not lose his spousal benefit when he remarries someone who is collecting survivor benefits. I was floored!

The reason? “The divorced spouse’s benefit is not affected when a person marries an individual entitled to widow’s benefits,” said SSA spokesperson Kia Green Anderson. That means the new husband can continue to collect spousal benefits on his ex, even after his remarriage to the merry widow.

I learned something new and I have Frank in Ft. Lauderdale to thank. And now, so do all the other Investment News readers.