If I Get A Divorce, Does My Spouse Still Collect My Social Security Benefits?

Recently, a friend of mine who is getting a divorce asked me this very question.  I had just recently read a Wall Street Journal article by Kelly Greene entitled “Social Security Benefits Don’t End With Divorce” and I summarize the findings below.

If your ex spouse: 

1) Did not re-marry

2) Earned less income than you, if any at all

3) Was married to you for at least 10 years

Luckily a divorced spouse can collect a Social Security retirement benefit based on the work record of an ex-husband (or ex-wife), and it won’t affect the latter’s retirement benefit or that of his or her current spouse.

For the divorced spouse to collect the worker must be at least 62 years old and collecting benefits or be eligible for benefits. 

The divorced spouse is also eligible for widow’s benefits after the worker dies.  Your current spouse also can claim Social Security based on your work history, along with widows benefits.  In a situation where the divorced spouse would be collecting survivor benefits, he or she could qualify at early as age 60 – or age 50 if he or she qualifies as having a disability.

If the divorced spouse remarries, he or she typically forfeits the working spouses SS benefit based on the former spouse’s working record.  However, if the spouse remarries after 60 he or she can still collect a widow’s benefit when the former spouse dies.

Please contact Dollars & Sense Education to bring our seminars to your company or organization!

Dollars & Sense Education – Raising Your Financial IQ!
http://www.daseducation.com
nicole@daseducation.com
215-499-3834

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Exit Strategy

Who Needs an Estate Plan and Why?  

Everyone.  A will tells the world exactly where you want your assets distributed when you die.

It’s also the best place to name guardians for your children. In addition to a will, there are plenty of other unpleasantries that make you unable to manage your own affairs for a while — that can go much more smoothly for you and your loved ones if you’ve prepared for them ahead of time.

What Does an Estate Plan Include?

An estate plan has several elements: a will; assignment of power of attorney; and a living will. For some people, a trust may also make sense.

How Much Does an Estate Plan Cost?

Typically a basic will plan costs $300-$2,000.

This includes a will, a living will, a health-care proxy and a power of attorney. More complex plans may include long-term tax planning as well as provisions for a bypass trust to take effect upon first spouse’s death.

So a Will Governs Where All My Money Goes?

Not all of your assets are governed by your will. Things like retirement accounts and life insurance go to the people you name on beneficiary forms. Changing your will or creating a trust won’t automatically change your beneficiaries on these accounts, so make sure you update information on all your accounts.

What is a Living Will and Health Care Proxy?

A living will is a statement of your wishes for the kind of life-sustaining medical intervention you want in the event that you become terminally ill and unable to communicate.

Most states have living will statutes that define when a living will goes into effect.  You increase your chances of enforcing your directive when you have a healthcare agent advocating on your behalf.

You can name such an agent by way of a healthcare proxy, or by assigning what’s called a medical power of attorney. You sign a legal document in which you name someone you trust to make medical decisions on your behalf in the event that you can’t do so for yourself.

A healthcare proxy applies to all instances when you’re incapacitated, not just if you’re terminally ill.

Why Should I Assign Power of Attorney?   

No one is immune from aging or the loss of mental clarity that may come with it. And you’re never immune to health crises that may leave you unable to handle the business of your life: paying bills, managing investments, or making key financial decisions.

Granting someone you trust the power of attorney allows that person – known as your “agent” or “attorney in fact” – to manage your financial affairs if you are unable to do so.

 Your agent is empowered to sign your name and is obligated to be your fiduciary – meaning they must act in your best financial interest at all times and in accordance with your wishes.

There are different kinds of powers of attorney, but in estate planning there are two essential types you should know:

The first is the “springing power of attorney,” which only goes into effect under circumstances that you specify, the most typical being when you become incapacitated.

There is also the “durable power of attorney.” It is effective immediately, and your agent does not need to prove your incapacity in order to sign your name.

An attorney can help you decide which form makes the best sense for your circumstance. In any case, take care in choosing your agent. That person should be competent, trustworthy, willing to take on the burden of your affairs, and financially secure.

Stay On Top of It

A marriage, divorce, or new child or grandchild can change your estate plan. Get the help you need to make appropriate changes and make sure that your wishes never go out of style.   

Please contact Dollars & Sense Education to bring our seminars to your company or organization!

Dollars & Sense Education – Raising Your Financial IQ!
http://www.daseducation.com
nicole@daseducation.com
215-499-3834

Stop Leaving Your Billions Lying Around People!

I recently met two interesting entreprenuers here in Philadelphia, Ben Adams and Armen Karamanian.  They founded a company called Fodius.  The company is basically a beneficiary notification system.  Many people have assets, insurance policies, etc. that because they have not properly updated or kept beneficiaries aware, go unclaimed every year.  Fodious makes sure your beneficiaries are promptly notified of their entitled assets.

I think it is a fabulous idea and am anxious to see if it will be adopted by many users!  I would be curious to hear people’s thoughts about this company.

Here is the code for 2 months free service when signing up.

 BKDM21 (case sensitive)

Please contact Dollars & Sense Education to bring our seminars to your company or organization!

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Dollars & Sense Education – Raising Your Financial IQ!
http://www.daseducation.com
nicole@daseducation.com
215-499-3834

Last Week’s Roundup!!

Here are some great links from last week!

JLP at All Financial Matters talks about: 

Index Mutual Funds or Exchange-Traded Funds? How About Both!

http://allfinancialmatters.com/2007/11/01/index-mutual-funds-or-exchange-traded-funds-how-about-both/

and 

A Question From a Reader: How to Calculate Taxes

http://allfinancialmatters.com/2007/10/31/a-question-from-a-reader-how-to-calculate-taxes/ 

At Money, Matter and More Musings folks were chirping about:

Things You Should Know About Percentage Traps

http://www.thetaoofmakingmoney.com/2007/10/31/536.html 

J.D. over at Get Rich Slowly discussed: 

A Brief Overview of Estate Planning Software

http://www.getrichslowly.org/blog/2007/10/31/a-brief-overview-of-estate-planning-software/ 

Jeremy at Gen X Finance breaks down:

When Owning a Home Isn’t Always All It’s Cracked Up to Be

http://genxfinance.com/2007/10/30/when-owning-a-home-isnt-always-all-its-cracked-up-to-be/

Meg at All Financial Matters explains:Millionaires Focus on Freedom 
http://allfinancialmatters.com/2007/10/29/millionaires-focus-on-freedom-2/
 

Please contact Dollars & Sense Education to bring our seminars to your company or organization! 

d_s_education_logo.gif 

Dollars & Sense Education – Raising Your Financial IQ!
www.daseducation.com
nicole@daseducation.com
215-499-3834