Retirement accounts are one of the most important assets in a divorce, but it's essential to understand the difference between retirement savings versus Social Security benefits. Retirement savings refer to private or employer sponsored contribution plans such as IRAs, pensions and 401(k)s. Social security, on the other hand, are benefits that are funded by tax dollars in order to provide financial assistance to the elderly and/or disabled. In the event of a divorce, the contributions made into a retirement account during the course of the marriage are subject to equitable distribution. Social security is not subject to equitable distribution, but it may be subject to spousal benefits if the marriage lasted for 10 or more years.
The ten year rule is explained in detail on the Social Security Administration's website at https://www.ssa.gov/. Still, there are some finer points of the rules which may apply to your specific case, especially if you are eligible for Social Security benefits under your own record. For example, the ten year rule includes all the days of your marriage, up until the finalization of your divorce. That means if you were married for 9 years before you filed for divorce, and it took another year for your divorce to be finalized, your marriage still falls under the 10 year rule. If a couple divorced and remarried, the total number of years for both marriages counts towards the 10 year period, but not the years in between the marriages.
Even if you satisfy the 10 year requirement, you must be unmarried in order to collect under your ex's record. If you did remarry, but your marriage ended, you are still eligible to collect under your first marriage as long as that divorce is at least two years old at the time the benefits begin. It should also be noted that your subsequent marriage(s) must have ended through divorce, death or annulment. Being separated, legally or otherwise, does not qualify as the end of a marriage by the Social Security Administration.
Another important issue is how spousal benefits are calculated if you qualify for your own benefits. Let's say, for example, that you would receive $450 a month on your own record. As a dependent under your ex's record, you would have received $550 a month. In that case, you would receive the $450 under your own record, and $100 under your ex's record in order to make up the difference. Be aware, however, that your spouse must be at least 62 years old in order for either of you to collect under his or her record. This is a critical consideration for couples who are far apart in age, particularly for older dependent spouses. As you can see, there are many important factors to consider if you are likely to fall under the 10 year rule by the time your divorce is finalized. For more information on post-divorce retirement benefits, please speak with the attorneys of Villani DeLuca, P.C.