Question: When I retired, I waited until I was 68 to draw my own Social Security benefit. Since then, I have worked part-time for 10 years. How can I -- or is it possible to -- have my Social Security payments adjusted for the additional years I have worked and paid into the system?
Answer: Your Social Security benefit is based on the highest 35 years of working and paying FICA taxes, said David Freitag, a financial planning consultant with MassMutual. Read more about that from the Social Security Administration.
If your current part-time income is higher than your earlier years of earned income, indexed for inflation, then the Social Security Administration will recalculate your 35-year average, said Freitag. "The good news is that if your 35-year average goes up, your benefits will increase," he said. "Remember that, because you are only replacing higher earning years in the average, your current benefits will never go down."
The bad news, said Freitag, is that if your part-time income does not increase the 35-year average, your benefit will not change and the FICA taxes you are currently paying will not increase your benefit.
According to Freitag, the Social Security Administration will contact you in writing if there has been a change in your benefit calculation.
Question: I am 70 years old and my wife is 74. I will be getting a divorce, and was told I could collect on her Social Security benefit because she gets $1,700 a month and I get $896 a month. She is not deceased yet and I thought after she died I could collect on hers if I was still alive but not while she was still living. We have been married since 2007.
Answer: As for question No. 1, Freitag said the spousal benefit is 50% of the full retirement age benefits. "In this case, your wife's current benefit of $1,700 was not her benefit at her full retirement age," he said. "There have been cost-of-living increases and perhaps some delayed retirement credits that are now included in her $1,700 a month payment. Her full retirement age benefit might have been in the 1,400 a month range."
But even if the $1,700 represents her benefit at her full retirement age, 50% of $1,700 is $850. "By any measure, your own benefit is higher than the spousal benefit so there is no reason to move while she is alive," said Freitag.
What's more, he said, to be eligible for a spousal benefit from an ex-wife, you must be married for 10 years or longer. Read more from the Social Security Administration.
As for the second question, Freitag said the survivor benefit is a totally different story. "Survivor benefits are paid at 100% of the amount she was receiving when she died," he said. "Because you were married for more than 10 years, you would be entitled to receive the equivalent of her benefit, or your own benefit, whichever is higher." Read more on this rule.
Freitag also noted that one day in the future, if you outlive your soon-to-be ex-wife, you will be able to switch to 100% of her higher benefit.
Got questions about the new tax law, Social Security, Medicare, retirement, investments, or money in general? Want to be considered for a Money Makeover? Email Robert.Powell@TheStreet.com. Kim McSheridan assisted with this report.
Question: When I retired, I waited until I was 68 to draw my own Social Security benefit. Since then, I have worked part-time for 10 years. How can I -- or is it possible to -- have my Social Security payments adjusted for the additional years I have worked and paid into the system?Subscribe for full article
Get Access to Our Exclusive Content
Already subscribed? Log In