Today’s column addresses questions about whether previous cost of living allowances (COLAs) apply to spousal benefits taken later, whether earlier COLAs apply to widow’s benefits and taking disability benefits before widow’s benefits. Larry Kotlikoff is a Professor of Economics at Boston University and the founder and president of Economic Security Planning, Inc.
See more Ask Larry answers here.
Have Social Security questions of your own you’d like answered? Ask Larry about Social Security here.
Will My Wife Get Earlier COLAs When She Takes Social Security Spousal Benefits?
Larry, Your column is great! Excellent information! My wife is eight years older than me. She claimed her reduced retirement benefits at 62. The spousal benefit for her will be higher than what she is now getting. I plan on applying for for my retirement benefits at 70. She will be 78 when I apply. Will she be entitled to the eight COLA increases when she applies for spousal benefits?
I know she won’t get the delayed retirement credits but I’m not sure about the COLAs. And will her spousal benefit be half of mine or will it be reduced? Thanks, Mark
Hi Mark, The answer to your question about COLAs is yes, but I should clarify. Your wife’s unreduced spousal rate would be calculated by subtracting her primary insurance amount (PIA) from 50% of your PIA. A person’s PIA is equal to their Social Security retirement benefit rate if they start drawing their benefits at full retirement age (FRA).
And since PIAs are updated annually to reflect Social Security cost of living (COLA) increases, your wife’s future spousal rate will include the COLAs that occur between now and when you start drawing your benefits.
And you’re right that the delayed retirement credits (DRCs) applied to your retirement benefit do not increase her spousal benefit. But note that since she filed for her retirement benefit before her full retirement age (FRA), her spousal benefit will be reduced below 50% of your PIA.
My company’s software — Maximize My Social Security or MaxiFi Planner — will accurately calculate your and your wife’s benefits rates. You can model taking them at specific dates to determine exactly what they would be so you can make informed decisions about when to file for your benefits. Social Security calculators provided by other companies or non-profits may provide proper suggestions if they were built with extreme care. Best, Larry
Would My Widow Receive The Amount That I Was Receiving When I Die, Or That Amount Plus Subsequent COLAs?
Hi Larry, I’m 20 years older than my wife. Let’s say I wait until I am 70 to start collecting my Social Security retirement benefit and then pass away at 71. When my wife reaches full retirement age, does she receive the benefits I was receiving when I passed, or does she receive that amount plus COLA for the 15+ years between when I passed and when she applies for her widow’s benefits? Thanks, Stan
Hi Stan, If your wife waits until her full retirement age (FRA) to claim widow’s benefits, she would receive your full benefit rate inclusing the delayed retirement credits (DRCs) you earned by waiting until 70 to start drawing, plus any Social Security cost of living allowances (COLAs) that occur after your death.
In other words, her unreduced widow’s rate would be equal to the amount that you would have been drawing if you were still living at the time your wife applies for her widow’s benefits. Just to be clear, though, your wife couldn’t receive your full rate and her own benefits simultaneously, just the higher of the two amounts. Best, Larry
Will I Be Able To Keep My SSDI And Also Get Benefits From My Husband’s Record?
Hi Larry, I’ve been on SSDI since 1995 and I only receive ~$275 a month now. I’m 60 now and my husband just passed away at 79. He started his Social Security retirement benefit at 62. He was receiving about $1,025 Will I be able to keep my SSDI and also receive a widow’s benefit? Thanks, Val
Hi Val, I’m sorry for your loss. Yes, you can potentially keep drawing your Social Security disability (SSDI) benefits and also qualify for widow’s benefits. The exact amount of widow’s benefits that you could now receive depends on your exact age and the amounts of your and your husband’s primary insurance amount (PIA). A person’s PIA is equal to their Social Security retirement benefit rate if they start drawing their benefits at full retirement age (FRA), or their full SSDI benefit rate.
If you’re drawing your own SSDI benefits and if you apply for widow’s the month you turn 60, your widow’s rate would amount to 71.5% of the difference between your PIA and your husband’s higher PIA.
The percentage would be a bit higher if you’re somewhere between ages 60 and 61 when you start drawing widow’s benefits. In any case, though, since you’re already drawing SSDI it would be advantageous to claim any widow’s benefits for which you qualify as soon as possible.
Any reduction for age applicable to the widow’s rate of a person who was eligible for SSDI benefits prior to receiving widow’s benefits is removed when the widow reaches full retirement age (FRA). Therefore, it sounds like there would be no downside to claiming your widow’s benefits ASAP.
You need to file an application with Social Security in order to claim widow’s benefits. If you haven’t already done so you’ll need to initiate that process by calling Social Security at 800-772-1213. It usually takes Social Security roughly 30 and 60 days to process a claim for widow’s benefits, but that time frame can vary. Best, Larry