Social Security Spousal Benefits: 3 Things to Know If You're Planning to Sign Up

Qualifying for Social Security benefits in retirement usually requires you to earn 40 work credits in your lifetime. But if you don't have a very robust earnings record, you may not accumulate enough credits to be eligible for Social Security based on your own work history.

That doesn't mean Social Security is off the table, though. If your spouse is eligible for Social Security based on their work history, you may be eligible for spousal benefits.

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Spousal benefits work a bit differently from regular Social Security benefits. So it's important to understand when to file and how they might fit into your retirement income strategy. Here are three key things to know.

1. You can't file until your spouse does

If you're looking forward to claiming spousal benefits, you may not be able to file as soon as you want. You need to wait for your spouse to claim Social Security before you can file for spousal benefits (though for divorcees, the rules are different, and you'll be able to claim spousal benefits on an ex's record before they sign up).

You should also know that if you claim spousal benefits before reaching your full retirement age, those payments will be reduced. Full retirement age is 67 if you were born in 1960 or later.

2. There's no financial advantage to delaying your claim

When you're claiming Social Security benefits on your own earnings record, there's a huge incentive to wait beyond full retirement age. Each year you hold off gives your benefits an 8% boost, up until age 70.

Spousal benefits are not eligible for those same delayed retirement credits. The most a spousal benefit is worth is 50% of your spouse's full retirement age benefit.

In other words, if your spouse gets $3,000 at full retirement age, your maximum spousal benefit is $1,500. Waiting longer to file won't help you at all.

3. Your spousal benefit could get a serious boost if it becomes a survivor benefit

Spousal benefits may be a helpful source of income. But you should know that those benefits could increase substantially if they become survivor benefits.

If you outlive your spouse, your spousal benefits will generally be bumped up to survivor benefits. At that point, they're worth 100% of the benefit your spouse qualified for.

Going back to our example, if your spouse's full retirement age benefit is $3,000 and they file at that time, you're limited to $1,500 as a spousal benefit. But you be may eligible for $3,000 a month if you're getting survivor benefits.

Spousal benefits may play a big role in your retirement income picture, so it's important to know how much money they might entail and when to sign up. A thoughtful plan could help you make the most of whatever Social Security you're able to get.

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