How to Optimize Social Security Survivor Benefits as a Widow

How to Optimize Social Security Survivor Benefits as a Widow
Elliott Appel, CFP®, CLU®, RLP®

Elliott Appel, CFP®, CLU®, RLP®

Welcome! I'm the founder of Kindness Financial Planning, LLC, a fee-only, fiduciary advisor located in Madison, WI working virtually with widows, caregivers, and people affected by major health events across the United States. When I'm not helping people live their ideal life, I'm often cooking for my wife, playing tennis, or hiking.

Last Updated on January 24, 2023


Deciding how to claim Social Security survivor benefits as a widow could be a decision worth hundreds of thousands of dollars. 

Deciding how to claim Social Security survivor benefits, while trying to navigate everything else when your loved one dies, is not a straightforward decision. Optimizing Social Security benefits requires you to consider your life expectancy, Social Security benefit amount, and your spouse’s benefit. 

Let’s discuss how Social Security benefits are calculated, what happens if a spouse dies, and how to optimize Social Security benefits over a widow’s lifetime. 

How Social Security Benefits are Calculated

First, you should understand how Social Security benefits are calculated. 

Social Security benefits are calculated based on your highest 35 years of earnings. The earnings are an “average indexed monthly earnings”, meaning it accounts for inflation. For example, if you made $25,000 in 1980, it is going to adjust the earnings up based on inflation, so it would be worth more to your average indexed monthly earnings than earning $25,000 today. 

This helps reflect the rise in the standard of living. 

If you don’t have 35 years of earnings, a zero value will be assigned for those years in which you earned nothing. As you can imagine, this is not a huge impact if you’ve worked most of the years because if you have 30 years of earnings and five years of a zero value, working one more year likely won’t drastically change the benefit amount. 

How Does Claiming Social Security Benefits Early Affect My Benefit?

Once the average indexed monthly benefit is calculated, a primary insurance amount, or PIA, is calculated. I won’t go into the details because it’s complicated to calculate.

You need to know that generally, the higher your earnings, the higher your primary insurance amount. 

You can claim Social Security benefits as early as age 62, but you will receive a reduced amount. It could be as much as a 30% reduction. 

Claiming Social Security benefits early - before full retirement age

The latest you can claim Social Security benefits and receive an increased amount based on a delayed retirement credit is age 70. 

Your birth year dictates your full retirement age, which is the age you can receive your primary insurance amount. For example, someone born in 1960 or later has a full retirement age of 67. For those born between 1943 and 1954, your full retirement age is age 66. For each year after 1954 and through 1959, your full retirement age increases by 2 months. For example, if you were born in 1955, your full retirement age is 66 and 2 months. 

Claiming before your full retirement age causes a reduction in benefits. It’s 5/9 of 1% for each of the first 36 months before your full retirement age and 5/12 of 1% for each subsequent month before full retirement age. 

On an annual basis, it’s a 6.7% annual reduction for the first three years and a 5% reduction for each year following before your full retirement age.

For each month you wait between your full retirement age and up to age 70, you can receive ⅔ of 1% of an increase. On an annual basis, that is an 8% increase in your Social Security benefit. There are very few, if any, financial instruments or investments that are similar to a U.S. government-backed guarantee of an 8% increase adjusted for inflation. This is why it often makes sense for people to wait until later to claim Social Security.

Delayed retirement credits for Social Security beyond full retirement age

But, given the special rules surrounding Social Security, life expectancies, assets, cash flow, and other personal factors, there are situations where it makes sense to claim Social Security early. This is why it’s important to do an analysis based on your own circumstances. 

You can calculate how your Social Security benefit may change using Social Security’s early or late retirement calculator

If you decide to wait to claim Social Security benefits, don’t forget to sign up for Medicare at age 65!

What are Social Security Survivor Benefits?

Now that you know how Social Security works, let’s talk about how it applies to widows. 

Social Security survivor benefits are benefits available to widows, widowers, and dependents of eligible workers under certain circumstances.  

Generally, the following conditions must have been met if you were married:

  • Your deceased spouse had 10 years of work history paying into Social Security
    • Or, sometimes benefits are available if they worked one and a half years in the three years before death. Check with Social Security to see if you are eligible. 
  • You were married for at least 9 months.
    • There are a few exceptions to this rule, such as an accidental death. 

Usually, a funeral home will report a person’s death to Social Security, but I’ve known of situations where that hasn’t happened. You can’t report a death online, but you can call them at 1-800-772-1213. 

Who Can Receive Social Security Survivor Benefits?

You may qualify for benefits if the following applies:

  • You are a widow or widower who is at least age 60.
    • If you are disabled, you could receive benefits as early as age 50 if the disability started before or within 7 years of the worker’s death. 
  • You are a surviving divorced spouse and you:
    • Were married at least 10 years
    • Are single or you remarried after you turned age 60 (50 if disabled)
  • You are any age, have not remarried, and you take care of the deceased worker’s child who is under age 16 or has a disability and receives child’s benefits. 
  • You are an unmarried child of the deceased who is:
    • Younger than age 18 (or up to age 19 if they are a full-time student in an elementary or secondary school) or
    • Age 18 or older with a disability that began before age 22
  • You are parents, age 62 or older, who were dependent on the deceased for at least half of their support

You can read more about Social Security for survivor’s on ssa.gov.

Can My Children Receive Social Security Survivor Benefits?

Children can receive Social Security survivor benefits. Children under age 18, or 19 if still in elementary or secondary school, can receive up to 75% of the base benefit. 

A widow can also receive up to 75% of the base benefit for caring for a child under age 16; however, the total amount a family can receive is limited. 

Maximum Family Amount

The maximum family amount varies, but generally, it is between 150% and 180% of the basic benefit rate. 

If the total amount of benefits is above the maximum, then the benefits may be reduced proportionally, although benefits paid to a surviving divorced spouse based on disability or age won’t count toward the maximum. 

Unfortunately, the calculation for the maximum family benefit is not easy to calculate, and there is no easily available calculator. 

If you are curious about the amounts and when they may change, contact Social Security. 

How does Remarriage Affect Social Security Survivor Benefits?

Remarrying can affect your Social Security survivor benefits. 

Before Age 60

If you remarry before age 60, you cannot claim survivor benefits. If you are already claiming survivor benefits, you are no longer eligible for them, and they will stop.

The exception is if you are disabled, the age is 50. If you are disabled and remarry before age 50, you cannot claim survivor benefits. 

After Age 60

If you remarry after age 60, you can collect survivor benefits or spousal benefits off your current spouse, whichever is the highest benefit. 

How to Find the Right Claiming Strategy for You

Now that you know the rules and eligibility behind survivor benefits, let’s talk about how to find the right claiming strategy for you. 

Generally, you want to pick a strategy that will optimize benefits over your lifetime, which makes it challenging because nobody knows their life expectancy, but there are general rules of thumb you can use to help make the decision.

I’d highly recommend using a software that analyzes the benefit amounts, life expectancy, and different ways to claim benefits. It will give you a better idea about how to optimize benefits than trying to do it by hand. I run this analysis for clients because there are too many variables to easily do it by hand. 

What benefits you are eligible for depends on whether your spouse filed for benefits and your age.

Deceased Did Not File for Benefits

Died before full retirement age: If your deceased spouse did not file for benefits and died on or before their full retirement age, you can receive your spouse’s full retirement age benefit adjusted for when you file for survivor benefits

Example: Sam did not file for benefits and was 64 when he died. His primary insurance amount was $2,500. Jasmine is 60. She can wait until her full retirement age to claim $2,500 or receive 71.5% of the amount today, which would be $1,787.50. She can also claim between age 60 and her full retirement age, but it will be reduced by a monthly adjustment.

Social Security Survivor Benefits percentages at various ages - deceased did not file, died before FRA

Died after full retirement age: If your deceased spouse did not file for benefits and died after their full retirement age, you can receive the same amount your spouse would have received on their date of death, adjusted for when you file for survivor benefits. 

Example: Sam died at age 69 before filing for benefits. His benefit at that time would have been $2,916 because he earned an 8% increase per year between ages 67 and 69. Jasmine is 60. She could claim 71.5% of the $2,916 now ($2,084.94) or wait until her full retirement age to receive the $2,916. She can also claim between age 60 and her full retirement age, but it will be reduced by a monthly adjustment.

Social Security Survivor Benefits percentages at various ages - deceased did not file, died after FRA

Deceased Did File for Benefits

Died before full retirement age: If your deceased spouse filed for benefits and died before their full retirement age, you can receive the larger of the actual benefit or 82.5% of the deceased’s full retirement age benefit. If you claim before your full retirement age, the benefit will be adjusted for when you file for survivor for survivor benefits. 

Example: Sam started his $1,750 monthly benefit at age 62 and died in the same year. He faced a 30% reduction in benefits for claiming early because he was born in 1960. Jasmine is 60. She gets the larger of Sam’s actual benefit, $1,750, or 82.5% of his primary insurance amount, $2,500, which is $2,062.50. Since $2,062.50 is larger, she could wait until her full retirement age to claim that amount or claim 71.5% of it now at age 60, which is $1,474.69. She can also claim between age 60 and her full retirement age, but it will be reduced by a monthly adjustment.

Social Security Survivor Benefits percentages at various ages - deceased did file, died before FRA

Died after full retirement age: If your deceased spouse filed for benefits on or after their full retirement age, the benefit amount you receive will be the amount they were receiving at death, unless you are less than full retirement age. If you are under your full retirement age, the amount will be adjusted for when you file for survivor benefits. 

Example: Sam started his $2,500 monthly benefit at his full retirement age and passed in the same year at age 67. Jasmine is 60. She could claim a reduced amount now (71.5% of it, or $1,787.50) or wait until her full retirement age to receive the full $2,500. She can also claim between age 60 and her full retirement age, but it will be reduced by a monthly adjustment.

Social Security Survivor Benefits percentages at various ages - deceased did file, died after FRA

Please keep in mind that if Jasmine is working and under her full retirement age, her survivor benefit is subject to the Social Security earnings test.

You should always contact the Social Security Administration to confirm your options and benefit amounts before making a claiming decision. 

Restricted Application

One of the common questions that comes up for widows who don’t have children at home is which benefit to claim at age 60, if any. 

As a widow and assuming you qualify for benefits, you could claim survivor benefits as early as age 60 or your own benefit as early as age 62. You can also use the restricted application to apply for your own benefits or widow benefits and switch to the other benefit later.

For example, you could claim widow benefits at age 60 and allow your own benefit to increase until age 70, when you switch to your own benefit at its highest point. 

You could also do the opposite. You could claim your own benefits at age 62 and allow the survivor benefit to increase until your full retirement age.

If you claim the survivor benefit before your full retirement age, you face a benefit reduction. Your birth year determines the monthly reduction amount.

Also, generally, if the deceased spouse started receiving benefits before their full retirement age, the survivor’s benefit is based on that reduced amount; however, it shouldn’t be less than 82.5% of the deceased spouse’s primary insurance amount at the survivor’s full retirement age.

Widows also need to pay attention to their own earnings because if you claim benefits before your full retirement age, you are subject to Social Security’s earnings limit. If you earn a certain amount, the benefits you receive are reduced. 

In 2023, you face a $1 deduction from your benefit payment for every $2 you earn above $21,240 if you are younger than your full retirement age. They deduct $1 for every $3 you earn above $56,520 in the year you reach your retirement age, but they only count your earnings before the month you reach your full retirement age.

Two common strategies are as follows:  

  • If the survivor benefit is larger, it can make more sense to collect your own benefit at age 62 and switch to the survivor benefit at your full retirement age. 
  • If your own benefit is larger, it can make more sense to collect a survivor benefit as early as age 60 and allow your own benefit to increase until age 70. Then, you could stop the survivor benefit and switch to your own benefit. 

How do you know which to claim and when? 

You could create a spreadsheet or plot out the cumulative lifetime benefits, reduce benefits by a discount rate to compare it to taking portfolio withdrawals, and use a cost of living adjustment increase to the benefits.

A better strategy would be to use software to model different claiming strategies. You can apply a discount rate, cost of living adjustment, and see how cumulative lifetime benefits change based on which month you claim your own benefit or a survivor benefit. 

It can tell you based on the inputs which claiming strategy would optimize benefits. 

Final Thoughts – My Question for You

Social Security survivor benefits are an important income source for a widow. 

Given the different rules, life expectancy, what assets are available to you, and many other factors, it’s recommended to pay for a software or to consult with a financial planner to determine how best to claim benefits. 

Making a mistake could cost you tens of thousands of dollars or more. 

I’ll leave you with one question to act on. 

Which step will you take to make sure you optimize benefits over your lifetime?

Disclaimer: This article is for general information and educational purposes only and should not be considered investment, financial, legal, or tax advice. It is not a recommendation for purchase or sale of any security or investment advisory services. Please consult your own legal, financial, and other professionals to determine what may be appropriate for you. Opinions expressed are as of the date of publication, and such opinions are subject to change. Click for full disclaimer.

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