Saving for retirement is important, but stashing money away in a 401(k) account is not the only way to create financial security for the future. In Alaska, it is fairly common to also rely on Social Security benefits, which help bridge the gap between what a person has managed to save, and his or her actual living expenses. But divorce can change those plans. Here’s how to protect retirement money even after ending a marriage.
The Social Security Administration reports that 21% of couples who are married depend primarily on Social Security benefits during retirement. Those benefits make up 90% or more of unmarried individuals’ retirement income. But a person who was married and did not work or earned significantly less might not think getting those benefits is even possible. However, many can file for benefits based on their ex-spouse’s work record.
There are several requirements for accessing those Social Security benefits after divorce. For example, the person applying for benefits must have been married for 10 years or longer. He or she cannot have remarried either, but an ex-spouse’s marital status does not factor into this decision. Should that individual also qualify for benefits based on his or her own work record, any benefits from a former spouse have to be less.
Even if someone is ready to claim those benefits, there are a few restrictions for doing so. Not only does one need to be at least 62 years old, but even then, getting Social Security benefits cannot begin until the former spouse starts claiming them as well. One exception is for people who have been divorced for two years and have an ex who is eligible for benefits but is not drawing them just yet.
Social Security benefits are important for most everyone in Alaska during retirement, especially so for divorcees. But people can also use the divorce process to try and secure further financial security in divorce. This includes doing things like paying careful attention during property division, considering future expenses and asking whether spousal support is an option.