Social security benefits constitute one of the most important means of leading a good quality of life after one is no longer capable of working in senior years. However like all government plans, certain confusions about its rules and beneficiaries persist. So if your spouse has been receiving social security benefits and you wish to know if you can continue to receive them after his/her death, here are a few guidelines.
Social security implies a group of social welfare and social insurance programs run by the government which offer benefits to seniors, survivors and the disabled. Specifically though social security in United States refers to monthly government payments to retired workers or their families who have paid Social Security taxes for a total of 40 quarters or ten years.
If a worker covered by Social Security dies, a surviving spouse can receive survivors' benefits. Some of the Social Security taxes that a worker has been paying go toward survivors insurance. In fact, the value of the survivors insurance one has under Social Security is under certain conditions more than the value of his/her current life insurance. In some instances, survivors' benefits are available even to a former spouse who may have been divorced from the deceased. Also a father or mother with minor or disabled children in his or her care can receive benefits which are not actuarially reduced.
What are the conditions?
In order for a surviving spouse to receive social security benefits of his/her deceased spouse, some conditions have to be met. Firstly the worker needs to have accumulated a minimum number of credits so that the surviving spouse is eligible for survivor’s benefits. This number of credits would depend on the age when he/she died. The younger a person is, the fewer the credits required, but nobody needs more than 40 credits or 10 years of work. A worker can earn up to four credits each year. In 2012, for example, a worker can earn one credit for each $1,130 of wages or self-employment income.
Under a special rule, the government can pay benefits to the children and spouse who is caring for the children of the deceased worker even if the latter does not have the number of credits needed. They can get benefits if the worker has credits for one and one-half year's work or 6 credits in the three years just before the death.
Then again if the deceased was already receiving retirement or disability benefits at the time of his/her death, the government will pay his/her spouse survivor’s benefit based on that entitlement. The credits need not be determined again.
How does it work?
If a person has worked for the certain number of years and accumulated necessary credits under Social Security, upon his/her death, the surviving spouse can receive full benefits at full retirement age for survivors or reduced benefits as early as age 60. Apart from this the surviving spouse can begin receiving benefits as early as age 50 if he/she is disabled but in this case the disability would have to be started before or within seven years of the working spouse's death. In case the widow or widower who is caring for the worker's children receives Social Security benefits, he or she is still eligible if their disability starts before those payments end or within seven years after they end.
After the death of the worker, the surviving spouse can receive survivor’s benefits at any age if he/she is taking care of the deceased worker's child who is under age 16 or is disabled and receives benefits on the worker's record.
If the surviving spouse remarries after sixty years of age, or after fifty if disable, the remarriage would not affect his/her entitlement to survivor’s benefits under social security scheme.
Apart from the above, a surviving widow or widower may be eligible to receive a special death benefit payment of $255 on the worker's record. This payment can be made only to a spouse or minor children who meet certain requirements. In case of the former, the surviving spouse should have been living in the same household with the worker when he or she died to receive the lump sum payment.
How to sign up?
The process for signing up for survivors benefits depends on whether or not the surviving spouse is getting other Social Security benefits at the time of application. If he/she is already getting benefits on the spouse's record when he or she dies, the death should be reported to the Social Security Administration which will then change the monthly payments to survivor’s benefits. In case the surviving spouse is not getting benefits, he/she should apply for survivor benefits promptly because, in some cases, benefits may not be retroactive.
Other options – life insurance
While the survivor’s benefits from the social security plan acts as an important financial support for the dependents of a deceased, the option of life insurance should also be explored. Since a life insurance policy is specifically designed with the purpose of providing cover to the insured person’s life, it provides larger financial returns to the survivor as compared in the social security scheme. Also in many cases life insurance can be more flexible and cheaper as compared to eligibility requirements for survivor’s benefits under the social security program. However life insurance is again of different kinds with the two broad types being whole life insurance and term life insurance. Each has its own costs and advantages vis-à-vis social security when it comes to catering for the needs and requirements of a spouse after the death of a person.