What happens to SBP if spouse dies first?
When a married couple is enrolled in Social Security, each spouse is eligible for their own retirement benefits as well as a survivor benefit based on the other spouse’s earnings. The Survivors Benefit Plan (SBP) is designed to provide financial support to the surviving spouse after the death of the primary earner. However, if the spouse who is entitled to the SBP dies first, several scenarios can unfold, depending on the individual circumstances and the survivor’s eligibility.
Eligibility for SBP Benefits
If the spouse who is entitled to the SBP dies first, the surviving spouse may still be eligible for the SBP benefits. The eligibility criteria are as follows:
1. Marital Status: The surviving spouse must remain married to the deceased for the entire duration of the marriage.
2. Age Requirement: The surviving spouse must be at least age 60 or have reached the age of eligibility for Social Security retirement benefits, whichever is later.
3. Insured Status: The surviving spouse must have been insured for at least one quarter of the year in each of the 10 years immediately preceding the death of the deceased spouse.
If the surviving spouse meets these criteria, they can begin receiving the SBP benefits as soon as they apply for them.
Amount of SBP Benefits
The amount of SBP benefits a surviving spouse receives is based on the deceased spouse’s earnings. The benefit amount is calculated as a percentage of the deceased spouse’s primary insurance amount (PIA), which is the amount they would have received at full retirement age. The percentage is determined by the deceased spouse’s earnings history and the age at which they began receiving benefits.
If the deceased spouse began receiving benefits before reaching full retirement age, the surviving spouse’s benefit amount may be reduced. Conversely, if the deceased spouse delayed receiving benefits beyond full retirement age, the surviving spouse’s benefit amount may be increased.
Spousal Benefits vs. Divorced Spousal Benefits
It’s important to note that the SBP is different from the Social Security spousal benefit. The spousal benefit is a separate benefit that allows a surviving spouse to receive a portion of the deceased spouse’s retirement benefits, regardless of whether they were married for the entire duration of the marriage. If the surviving spouse is eligible for both the SBP and the spousal benefit, they can choose which benefit to receive.
In the event that the spouse who is entitled to the SBP dies first, the surviving spouse must decide whether to continue receiving the SBP benefits or switch to the spousal benefit. The decision should be based on which benefit provides a higher monthly payment.
Conclusion
In summary, if the spouse who is entitled to the SBP dies first, the surviving spouse may still be eligible for the SBP benefits, provided they meet the eligibility criteria. The amount of the SBP benefits is based on the deceased spouse’s earnings, and the surviving spouse must choose between the SBP and the spousal benefit if eligible for both. It’s crucial for married couples to understand their Social Security benefits and plan accordingly to ensure financial security for both partners throughout their lives.
