Real Question from a Federal Employee
I have a question regarding social security. I will have the higher benefit and plan on not collecting social security until at least my FRA (67). My question is: If I would die BEFORE I start receiving social security, how is my wife’s survivor benefit (i.e., my benefit) affected? – Joe
What Happens to Your Social Security If You Die Before Claiming?
Federal employees often wonder:
“If I delay Social Security and pass away before starting benefits, what happens to my spouse?”
The answer depends on Social Security Administration (SSA) rules and your specific situation. It’s also important to know that Social Security survivor benefits and FERS survivor annuity elections are separate, each with their own rules.
Social Security Survivor Benefits: The Basics
According to Social Security Administration (SSA) rules, a surviving spouse may be eligible for benefits based on the deceased spouse’s earnings record.
According to the SSA:
- A widow or widower may receive up to 100% of the deceased spouse’s benefit, depending on the survivor’s age and claiming timing (Social Security Administration [SSA], n.d.-a).
- A surviving spouse generally receives the higher of their own retirement benefit or the deceased spouse’s benefit, but not both combined (SSA, n.d.-a).
- Benefits may be reduced if claimed before the survivor’s Full Retirement Age (SSA, n.d.-a).
Eligibility and benefit amounts depend on your age, marital history, and SSA rules.
What If You Die Before Starting Benefits?
If you wait to claim Social Security, such as until Full Retirement Age (FRA) or age 70, and pass away before starting benefits:
- Your spouse may still be eligible to claim a survivor benefit based on your earnings record.
- Delayed Retirement Credits (DRCs) earned by postponing benefits beyond FRA may increase the amount payable to a surviving spouse (SSA, n.d.-b).
- Social Security may provide a small lump-sum death payment in some cases, but usually, there is no back payment for missed monthly retirement benefits before you started claiming (SSA, n.d.-c).
In short, waiting to claim benefits can increase the survivor benefit, as long as you meet SSA eligibility and timing rules.
How Delayed Retirement Credits Work
The SSA provides Delayed Retirement Credits for individuals who postpone claiming benefits beyond Full Retirement Age, up to age 70.
According to the SSA, retirement benefits increase by approximately 8% per year for each year benefits are delayed beyond FRA until age 70 (SSA, n.d.-b).
Since survivor benefits are based on what the deceased spouse could have received at death, waiting to claim can mean a higher survivor benefit, depending on eligibility and timing.
Social Security vs. FERS Survivor Benefits
Federal employees should know that Social Security survivor rules are different from pension survivor choices under the Federal Employees Retirement System (FERS).
Under guidance from the U.S. Office of Personnel Management (OPM), a FERS retiree may elect:
- A full survivor annuity (50% of the unreduced annuity),
- A partial survivor annuity (25%), or
- No survivor annuity (U.S. Office of Personnel Management [OPM], n.d.).
These choices only affect your federal pension and do not change Social Security survivor eligibility.
Do Survivors Receive Both Benefits?
A common misconception is that a surviving spouse receives both their own Social Security retirement benefit and their deceased spouse’s full benefit.
Under SSA rules, a surviving spouse generally receives the higher of the two benefits, not both combined (SSA, n.d.-a).
However, depending on age and strategy, a surviving spouse may choose to start one benefit and later switch to another if eligible. These decisions depend on individual circumstances and SSA regulations.
Tax Considerations
Social Security timing decisions may also affect income taxation.
The Internal Revenue Service (IRS) states that up to 85% of Social Security benefits may be taxable depending on provisional income thresholds (Internal Revenue Service [IRS], 2023).
Because survSince survivor benefits can change your household income, tax planning is an important part of your retirement strategy.eaways
- If you die before claiming Social Security, your spouse may still qualify for survivor benefits.
- A surviving spouse generally receives the higher of their own benefit or the deceased spouse’s benefit, subject to SSA rules.
- Delaying benefits beyond Full Retirement Age may increase potential survivor income.
- Social Security survivor rules are separate from FERS survivor annuity elections.
- Timing decisions should consider eligibility, taxes, income needs, and long-term planning objectives.
ABOUT THE AUTHOR
Micah Shilanski, CFP®, is a distinguished financial planner known for his deep commitment to providing exceptional advisory services to his clients. As the founder of Plan Your Federal Retirement, Micah has dedicated his career to helping federal employees understand and optimize their benefits to ensure a secure and prosperous retirement. His experience is widely recognized in the industry, making him a sought-after speaker and educator on financial planning and retirement strategies.
Micah’s approach is client-centered, focusing on creating personalized strategies that address each individual’s unique needs. His work emphasizes the importance of comprehensive planning, incorporating aspects of tax strategy, investment management, and risk assessment to guide clients toward achieving their financial goals.Micah Shilanski (00:00)
You ever wonder what happens to your social security benefit when you die? Well, if you have, stay tuned for this FERS Federal Fact Check. Hi, I’m Micah Shilanski with Plan Your Federal Retirement. Today we have a really good question coming in from Joe. Joe says, I have a question regarding social security. I will have the higher benefit and plan on not collecting social security until at least my FRA, full retirement age, which for him is 67. My question is, if I would die before I start receiving social security,
How is my wife’s survivor benefit, i.e. my benefit, affected? Joe, that is an excellent question. So a couple of things come into play, right? Number one, when you say your benefit, are you talking about your social security benefit or are you going to be talking about your FERS benefit? Not 100 % sure. So let’s answer both of those questions. Let’s take your FERS benefit first, right? For your FERS benefit, really depends on what your survivor benefit election wants. You have three options on that retirement application. A full survivor benefit, which is half.
a reduced survivor benefit, which is 25%, or no survivor benefit, which is disinheriting your spouse, which is zero. So that one’s going to be pretty simple to whatever you selected on that retirement application. The more fun question, the one I think you really go in for is for your social security benefit, what is affected with that? So let’s just put some numbers on it. Let’s say your FRA full retirement benefit was going to be $3,000 a month at 67. And let’s say your wife’s benefit was going to be a thousand. Just going to make my example really easy right here.
So you’re choosing to delay your benefit, which is fantastic. God forbid if you pass away at any point in time, your spouse gets to choose the higher of their benefit or your benefit, whichever is higher. They do not get both, they get whichever is higher. So in this case, your wife would be eligible for all of your benefit, which is at $3,000 a month.
A lot of times what we’ll look at with spouses that have a discrepancy in their social security benefits, one is dramatically higher. We might start that younger spouse a little sooner drawing their social security and then waiting until the spouse with more income and for them to delay till 67, maybe we wait till 70 where it’s gonna be over $4,000 a month, probably Joe in your case, before we turn on that benefit. Again, that’s a great survivor benefit tool because Joe, when you pass away, your spouse gets the higher of their benefit or your benefit, so they get a pretty big adjustment.
Now there’s no lump sum payment that’s there. So if you just choose to delay between 62 and 67, and then you pass away in that delayed period, there’s no lump sum life benefit going to your spouse. But your spouse then has that option of saying, hey, do I wanna claim my benefit or do I wanna claim your benefit at that time to get the higher of the two? So the good news is delaying this creates a higher benefit for your spouse. So it’s something really important to think about. Social security planning, I gotta say something.
I think it’s a little bit missed. People are like, hey, I’m gonna die, so I wanna take it right away. Some people are like, hey, I need to take it when I’m 70. But there’s a lot of in-between reasons that we should think about our social security planning, especially taxes. How taxes come into play with social security is a massive planning strategy that you really need to be thinking about, especially with the 03BA, the one big, beautiful bill act our current tax law that we have, and how the current tax laws affect that. If you haven’t done a 10-year tax projection,
end your retirement to see how do you beat the IRS out of thousands of dollars in taxes, then you might want to pick up the phone and give us a call. This is something we love doing is working on taxes to help you save more money in the long run. Till next time, happy planning.
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