Every paycheck someone earns will have deductions taken from it by an employer. People don’t have to calculate their own tax withholdings because their employers send estimated payments to the government on their behalf (unless they work for themselves or as independent contractors).
In addition to income taxes, paychecks help fund Social Security benefits programs. Many people rely on Social Security retirement benefits to supplement their savings when they stop working full-time. Their benefits can therefore have a major impact on their estate planning efforts, particularly when it comes to asset protection and/or Medicaid planning.
If someone divorced previously, will the end of their marriage affect their eligibility for Social Security retirement benefits?
Dependent spouses may have benefits rights
If someone remained married for at least 10 years and was financially dependent on their spouse, they may qualify for retirement benefits based on what their spouse earned. That right to claim Social Security retirement benefits does not necessarily end when someone divorces.
Divorced spouses can claim benefits based on what their former spouse earned either to supplement what they earn from their own Social Security retirement benefits or to provide them with benefits when they otherwise would not qualify for them. Those who were primary wage earners for their households will not have to worry about such claims by their dependent spouses diminishing what they receive.
Those who recognize the kinds of benefits they can qualify for during retirement may have an easier time planning for their financial stability in their golden years. Learning more about what divorce might mean for estate and retirement planning can benefit those looking forward to leaving the workforce and/or their marriage.