How Spousal Benefits Are Calculated

Martha Shedden RSSA President & Co-Founder

 

All couples are usually entitled to one or more Social Security benefits. If you have worked enough to earn 40 credits, usually 10 years or more, then you are entitled to retirement benefits.

If you have not worked at all or have only worked several years and not earned the required 40 credits, you are still entitled to a spousal benefit based on your spouse’s earnings.

A spouse may only collect a spousal benefit if the other spouse has started collecting their own retirement benefit.

Spousal benefits are calculated based on the Social Security benefit amount that the worker will receive at their full retirement age, or FRA. This is known as the worker’s primary insurance amount, or PIA.

A spousal benefit is 50% of the worker’s PIA if the spouse collects it at their own FRA. If they collect it at a younger age, then it will be reduced below the 50%.

As an example, consider Mike and Ellen who are both 62 and have a full retirement age of 66. Mike’s PIA, is $2,400. Ellen is not entitled to her own retirement benefit.

Mike begins collecting his retirement benefit at age 66, he will receive $2,400/month. Ellen is then able to collect a spousal benefit of $1,200/month. Their total benefit amount at age 66 would be $3,600/month.

Retirement and spousal benefit amounts both decrease a fraction of a percent for every month they are collected prior to full retirement age.

If Mike collects his retirement benefit at age 62, he will only receive 75% of his PIA, or $1,800/month. At age 62 Ellen would only receive 35% of Mike’s PIA, or $840/month. Their total benefit amount at age 62 would be $2,640/month.

If retirement benefits are collected after FRA, they continue to increase every month up to age 70. Spousal benefits do not increase above 50% of the worker’s PIA.

If Mike collects his retirement benefit at age 70, he will receive 132% of his PIA, or $3,168/month, due to delayed retirement credits. At age 70 Ellen still receive 50% of Mike’s PIA, or $1,200/month. Their total benefit amount at age 70 would be $4,368/month.

This example only applies to those with a FRA of 66 who were born between 1943 and 1954. The percentages vary for those with higher full retirement ages up to age 67.