Gray divorce, a term used to describe couples divorcing later in life, has been on the rise. As individuals over the age of 50 end long-term marriages, new financial considerations emerge—one of the most significant being Social Security benefits. Understanding how Social Security works after divorce can greatly impact retirement plans and financial security. For those navigating a gray divorce in New Jersey, here’s what you need to know about Social Security benefits and their implications.
Key Takeaways
- You may be eligible for Social Security benefits based on your ex-spouse’s work record if you were married for at least 10 years and are unmarried at the time of claiming.
- Claiming Social Security benefits before full retirement age (FRA) reduces the amount, but delaying benefits past FRA can increase monthly payments.
- Remarrying ends eligibility for Social Security benefits based on your ex-spouse’s record, but you can claim benefits based on your new spouse’s work history or your own.
- If your ex-spouse passes away, you may qualify for survivor benefits, which could be up to 100% of their Social Security, provided certain conditions are met.
- Social Security benefits are not divided in divorce settlements, but your overall financial plan should consider the interaction between alimony, retirement assets, and your benefits.
Social Security Benefits in Gray Divorce
| Aspect | Eligibility for Ex-Spouse Benefits | Survivor Benefits | Impact of Remarriage |
|---|---|---|---|
| Marriage Requirement | At least 10 years | At least 10 years | Remarriage ends eligibility for ex-spouse benefits |
| Age Requirement | At least 62 | Reduced benefits if claimed before FRA | Eligibility for new spouse benefits if remarried |
| Amount of Benefit | Up to 50% of ex-spouse’s benefit | Up to 100% if at full retirement age | New benefit calculation based on current spouse or own record |
| Claim Without Ex’s Consent | Yes | Yes | Not applicable |
| Effect on Divorce Settlement | Social Security not divided, but affects financial planning | Social Security not divided, but affects survivor income | Must consider financial impact before remarrying |
Does Social Security Affect Alimony?
One of the questions that NJ divorce lawyers hear often is: “Does Social Security affect alimony?” The answer is no. Alimony does not affect Social Security and vice versa. Social Security benefits are based on earnings. They can’t be reduced because you are receiving alimony payments.
Whether you receive benefits based on your own earnings or as a divorced spouse on your ex-spouse’s earnings, alimony does not influence the amount you receive. Social Security benefits are calculated based on your work history, your ex-spouse’s work history, or your full retirement age (FRA).
The important thing to remember is: While alimony does not affect the amount of Social Security benefits, alimony payments could have tax consequences. Alimony payments are generally considered taxable income for the recipient, depending on when the divorce was finalized. If your combined income, which includes Social Security benefits and other income like alimony, exceeds a certain threshold, a portion of your Social Security benefits could become taxable.
Can My Ex Stop Me From Claiming Benefits Due to Their Work Record?
No, you don’t need to receive permission from your ex-spouse to receive benefits, not even their retirement benefits. You also don’t have to discuss how and when you plan to claim those benefits. Your ex can’t use their marital status—remarried or not—to change whether you receive ex-spousal benefits either. Furthermore, the benefits that were rewarded to you are yours. Those benefits can’t be denied or reduced.
In other words, your ex will have no influence over the benefits you receive after divorce.
What Happens If My Ex-Spouse Passes Away After Our Divorce?
In New Jersey, survivors are eligible for at least a one-time payment of $250. If you reached the full retirement age (FRA), you are entitled to 100% of the amount your ex-spouse was receiving from Social Security every month when they passed. However, if you must claim survivor benefits before reaching full retirement age, the amount of benefits you receive will be reduced.
You may qualify for survivor benefits if you meet the following criteria:
- At least 10 years of marriage
- You are at least 62 years old
- You’re single or did not get remarried until you were 60
- You’re caring for a child that is disable or under 16 who also gets benefits from your former spouse (in this case, the first two criteria are waived)
About Full Retirement Age and Maximizing Benefits
It’s essential to understand how full retirement age (FRA) affects your benefit amount. The FRA is based on your birth year, typically between 66 and 67 for most people. If you claim benefits before reaching your FRA, the benefit amount will be reduced. However, if you delay receiving benefits beyond your FRA, your monthly payments could increase.
When divorcing later in life, maximizing your Social Security benefits can significantly influence your post-divorce financial well-being. A family law attorney can help you assess the optimal time to claim benefits based on your situation.
Does Remarriage Impact Benefits?
Now, while your spouse’s decisions and work record does not directly impact the benefits you receive from Social Security after your gray divorce, your actions might. If you decide to remarry, your eligibility for Social Security benefits based on your ex-spouse’s record will end. In this case, you will either receive benefits based on your new spouse’s work record or your own, depending on which offers the higher payout. This is an important consideration for those contemplating remarriage after a gray divorce, as it could significantly alter your future financial landscape.
Division of Assets and Social Security Benefits
In New Jersey, Social Security is not subject to equitable distribution. That said, your divorce settlement and retirement assets may interact with those benefits. It is critical to plan out your divorce and the aftermath so you know what kind of finances you will have available to you. Factors like alimony and the division of retirement accounts may play a significant role in shaping your post-divorce financial security.
Contact a New Jersey Divorce Attorney About Your Gray Divorce
Gray divorce presents unique challenges, particularly when it comes to financial planning for retirement. Social Security benefits can be a valuable source of income, but understanding the rules surrounding eligibility, remarriage, and survivor benefits is key to making informed decisions. Consulting with a family law attorney can help ensure that you are maximizing your benefits and securing a stable financial future.
If you’re considering or currently navigating a gray divorce in New Jersey, Ziegler Law Group, LLC can provide you with the guidance and legal knowledge you need to protect your interests and ensure your financial well-being moving forward. Contact us today at 973-533-1100 or by filling out the online form.
FAQ Section
1. Can I collect Social Security based on my ex-spouse’s work record after a gray divorce?
Yes, if you were married for at least 10 years, are currently unmarried, and meet age requirements, you can collect benefits based on your ex-spouse’s work record.
2. Does alimony affect my Social Security benefits in New Jersey?
No, alimony does not impact the amount of Social Security benefits you receive. However, alimony may affect your taxable income, which could make a portion of your Social Security benefits taxable.
3. Will I lose Social Security benefits based on my ex-spouse’s record if I remarry?
Yes, remarrying typically ends your eligibility for benefits based on your ex-spouse’s work record. You may instead be eligible for benefits based on your new spouse’s record or your own.
4. How much Social Security will I receive if my ex-spouse passes away?
If you qualify for survivor benefits and are at full retirement age, you may receive up to 100% of your ex-spouse’s benefit amount. Claiming before full retirement age will reduce the benefit amount.
5. Is Social Security included in asset division during a New Jersey divorce?
No, Social Security benefits are not subject to equitable distribution in New Jersey. However, they should be factored into your overall financial planning during a gray divorce.
