Gray divorces, which are divorces among couples aged 50 and older, are increasingly common in Tennessee. One aspect that couples may overlook in these splits is the impact on Social Security benefits.
The links among marital status, Social Security and retirement benefits can significantly influence the financial well-being of individuals navigating the challenges of a gray divorce.
Social Security basics
Almost 67 million Americans get a Social Security benefit. Social Security is a federal program that provides financial support to retirees, individuals with disabilities and survivors of workers who died. During a marriage, spouses accumulate Social Security credits jointly, which may affect their benefits upon retirement. In gray divorces, the division of these credits becomes a consideration.
Impact on retirement benefits
When a couple divorces, it can affect the Social Security benefits each spouse is set to receive. A spouse married for at least 10 years is eligible for benefits based on their ex-spouse’s work record. However, if a divorce occurs and the marriage lasted less than 10 years, the ex-spouse cannot get benefits based on their former partner’s record.
Understanding the optimal time to claim Social Security benefits is important, especially in gray divorces. The timing of benefit claims can impact the amount both parties receive. For instance, delaying the claim until full retirement age can result in higher benefits. This decision becomes even more complex with divorced spouses’ benefits, which can be up to 50% of their ex-partner’s full retirement amount.
Navigating these complexities can help ensure financial stability during the challenging process of a gray divorce.