In 2019, when the new alimony rules kick in, this will make major changes to the way we think about alimony arrangements.
divorce
Exception to the Divorced Spouse Remarriage Rule
Generally speaking, when a divorcee is receiving a Social Security spousal benefit based on an ex-spouse’s record, the recipient must remain unmarried in order to continue receiving the ex-spouse benefit. (For more details on this, see Coordinating Social Security Benefits in Matters of Divorce and Remarriage.) In many cases,when a divorcee remarries, the spousal benefit based on his or her ex-spouse’s record will end. However, there is an exception to this rule that I recently became aware of. It’s in part because the circumstances surrounding this exception have recently become more common – so let’s get to the exception. The Exception If the person who is receiving a spousal benefit based on an ex-spouse’s record marries someone who is currently receiving widow(er)’s, mother’s, father’s, divorced spouse’s, or parents’ benefits, the spousal benefit will continue. That’s a mouthful! Let’s play out an example: Jane is divorced from Gerald. Jane has been receiving […]
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Divorcee Social Security Planning
If you’re planning to retire and you’re a divorcee, you may be entitled to additional retirement benefits based on your ex’s earnings record. This can be quite a boon for an individual whose ex-spouse has had a significant earnings record over his or her lifetime. Especially so, if your own benefit is lower because you didn’t work outside the home for a significant number of years. You may be eligible for this additional benefit if you are at least age 62, your marriage lasted for at least ten years, and your ex-spouse is at least 62 years of age (and therefore eligible for Social Security benefits). If your ex hasn’t filed for his or her own Social Security benefit, the last factor is that your divorce must have been final for at least two years. If your ex has filed for benefits, this time limit is eliminated. How Can You […]
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Complications with Social Security Filing for Divorcees
Note: with the passage of the Bipartisan Budget Act of 2015 into law, File & Suspend and Restricted Application have been effectively eliminated for anyone born in 1954 or later. If born before 1954 there are some options still available, but these are limited as well. Please see the article The Death of File & Suspend and Restricted Application for more details. Social Security filing decisions are tough enough – and so is being divorced. Add the two together and you have all sorts of complications. In this article we’ll review one type of complication with Social Security filing for divorcees that can work in your favor and one that can work against you. Let’s start with the provision that may work against you – Deemed Filing. Deemed Filing When you file for benefits prior to Full Retirement Age (FRA, which is 66 for folks born between 1943 and 1954, […]
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7 Questions About Divorcee Social Security Benefits
Included in the myriad of questions that I regularly receive from readers are questions about how a divorced person can collect benefits based upon his or her ex-spouse’s Social Security record. For a divorcee (as with many married couples) sometimes the ex’s benefits represent the lion’s share of the couple’s SS record. Because of this, many divorcees are very interested in knowing what benefits are available to them, and when. In addition, even when the divorced spouse in question is not the higher earner there are questions about benefits that can be quite difficult to find answers for.
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QDRO vs Transfer Incident to a Divorce
Divorcing couples often face the need to split up some retirement account assets. This can be done from a retirement plan such as a 401(k) or 403(b), or from an IRA. Depending on which type of account you’re splitting, the rules are very similar but are referred to by different names. For a qualified retirement plan (401(k) or 403(b) plan), the operative term is Qualified Domestic Relations Order or QDRO (cue-DRO). For an IRA, the action is known as a transfer incident to a divorce. We discussed the QDRO in several other articles, so we’ll focus on the transfer incident to a divorce in this article.
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Know Your Options When Talking to Social Security
When you get ready to file for your retirement benefits, it’s important to understand what options are available to you before you talk to the Social Security Administration. There are many ways to get a good understanding of your options, including working with your financial advisor, reading up on the subject (this blog is a good place to start!), and talking to friends and relatives who have already gone through the process. The reason it’s important to know your options is because the Social Security Administration staff that you may encounter are not trained to help you maximize your lifetime benefits – they are trained to help you maximize the benefit that you have available to you today. Often the options that the SSA staff present to you are not the best options for you in the long run. In addition, SSA staff are absolutely overwhelmed by the volume of […]
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A Social Security Option Strictly for Divorced Folks
There is a loophole in the rules surrounding how divorced folks’ Social Security benefits are treated. As you may know from other articles you’ve read here and elsewhere, if you were married for at least ten years and you’ve been divorced for two years, as long as your ex is at least age 62, you are eligible to file for a Spousal Benefit based upon the ex’s record. In addition, as long as you fit the circumstances, if your ex passes away before you, you will have access to his or her Social Security benefit amount as a Survivor Benefit. These things are pretty much the same as if you were still married to your ex-spouse. There’s one rule that is different for ex-spouses than for a married couple – and it has to do with the restricted application for Spousal Benefits. Restricted Application for Spousal Benefits If you’ll recall, […]
Sterling Raskie, MSFS, CFP®, ChFC®
The latest in our Owner’s Manual series, A 401(k) Owner’s Manual, was published in January 2020 and is available on 
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