Money Talks News’ article entitled “3 Costly Social Security Mistakes That Women Make” says that typically women tend to make less money and live longer than men. This can result in lower Social Security benefit payments and other issues. Let’s take a look at some of the costliest Social Security mistakes that women might make.
Claiming Social Security benefits too early. If you decide to take Social Security benefits too soon, it can be costly for men. However, that negative effect is usually greater for women. It’s especially true for single women and women in same-sex relationships or marriages. Women usually have a more difficult time saving for retirement than men: they have lower lifetime earnings and a longer lifespan than men, on average. For single women, these challenges are exacerbated by the absence of a significant other bringing in additional Social Security income or any other type of retirement income. In light of this, it may be smart to put off claiming Social Security benefits as long as possible, so the amount of the monthly benefit is higher when they do start receiving it.
Failing to consider your ex-spouse. If you’re divorced, and your marriage lasted at least 10 years, you might be eligible for benefits through your ex-spouse. As a result, before assuming that you must rely solely on your own Social Security account, see if you’d get a better monthly payment by claiming through an ex’s earnings record. If you’re currently unmarried and at least 62, and the ex is at least 62, you can claim spousal benefits. Your own retirement benefits at full retirement age must be less than half of your ex’s benefits. Even if your ex hasn’t applied for benefits yet, you can still file a claim on the ex’s account, provided that you and the ex both are at least 62. If a later marriage also ends, you again become eligible for the ex-spousal benefits.
Allowing your spouse to make a unilateral claiming decision. It’s not uncommon for husbands to consider more immediate issues and decide to claim Social Security sooner.
Discuss how to best manage when each of you should file a claim for benefits. It’s best to coordinate your retirement plans and your Social Security claims with your spouse.
For more information about estate planning in Orlando, FL (and throughout the rest of Central Florida), visit our estate planning website and be sure to subscribe to our complimentary estate planning e-newsletter while you are there.
Reference: Money Talks News (July 22, 2021) “3 Costly Social Security Mistakes That Women Make”