Choosing the best time to claim Social Security benefits can be tricky, mostly because we don't know precisely how long we'll live to collect.
Even if we make an educated guess on our own longevity, however, plenty can still go wrong.
This column recently steered a 65-year-old retiree to the Social Security Administration to sort out a miscommunication about benefits. The retiree, widowed decades ago, attempted to claim a survivor benefit only, which would cause her work-record benefit to grow until she switched to that benefit on or after reaching full retirement age. She said a field office worker told her she couldn't do that, and her case hung in limbo while she got it sorted.
Turns out, she actually can do that _ even though she remarried and then divorced _ and she says she thinks the problem is now fixed. She expects to begin collecting the correct benefit shortly.
Her situation was a reminder, however, that misunderstandings and mistakes do happen with this complex federal program, on both sides of the desk, so retirees need to be vigilant when applying for benefits.
Detailed information on how benefits are supposed to work are found at the government website, but anyone who is or was married should understand a few basics about the program and be prepared to ask questions if the day comes to apply for a survivor's benefit:
1. Survivor benefits are different. These benefits have admirably helped reduce the poverty rate among widows over the last generation, but widows' poverty rates are still substantially higher than the rate among married women, according to the Center for Retirement Research at Boston College. Perhaps for that reason, survivor benefits were left alone during the latest changes to spousal benefits. Unlike most spouses now, survivors can choose to receive a survivor benefit only and then switch to their work-record benefit later (or vice versa) in a strategy to maximize lifetime benefits. This is the strategy the reader was trying to use.
2. They can be claimed earlier. Survivors can claim reduced benefits at age 60 _ or 50 if they are disabled _ though their earned income can trigger withholding of those benefits. That's two years earlier than the earliest claiming age for retirees, and I've heard from several widows over the years that they would have claimed benefits sooner if they knew it was an option.
3. Good news/bad news. Despite these two "perks," a lot of widows are caught unprepared by the death of a spouse. Although the survivor's benefit amount steps up to the higher of the couples' two amounts, there will only be one check, not two, going forward. This can put a serious dent in a retirement plan if it hasn't been accounted for, experts say.
4. There's a remarriage penalty. Survivors who remarry before age 60 forfeit the widow benefits. But if that marriage ends in divorce, the survivor benefit is back in the picture.
5. Applying online is a no-go. Survivors should call 1-800-772-1213 to start the process.
Meanwhile, be aware scammers are placing fraudulent phone calls that attempt to trick people into giving up their Social Security numbers and other information.
"SSA imposters tell you your Social Security number has been suspended because of suspicious activity," Federal Trade Commission officials warned recently. To "reactivate" the number, they ask for identifying information. To report these calls to the FTC, call 1-800-269-0271 or go to www.oig.ssa.gov/report.
