When you’ve been in business as long as we have and you’ve helped as many retirees and soon-to-be-retirees with their planning as we have, you hear a lot of the same questions. We thought it would be a good idea to answer a couple of these repeated questions every week.
Please note this very important fact. Our answers do not take into account your particular investment objectives, financial situation, or risk tolerance and may not be suitable for all investors. Our answers are not financial advice and should not be taken as advice. This material is provided for educational purposes only.
Can I claim Social Security benefits from my ex?
As divorces became more common in the ’60s, ’70s, and ’80s, splitting marital benefits became an issue. Questions like “Can I claim Social Security spousal benefits even if we’re divorced?” and “Can my ex claim part of my Social Security” suddenly needed answering.
Divorce can complicate many areas of your financial life, but Social Security is one place where the rules can actually work in your favor—if you understand them.
If you were married for at least 10 years, you may be eligible to claim benefits based on your ex-spouse’s earnings record. This is known as a divorced spousal benefit. For anyone concerned that their ex is somehow going to take their money, know this: the divorced spousal benefit does not reduce your own benefit, nor does it impact their current spouse if they’ve remarried.
To qualify for the divorced spousal benefit, you must be age 62 or older, currently unmarried, and your ex-spouse must be eligible for Social Security (they don’t have to be actively claiming yet, as long as you’ve been divorced for at least two years). At your Full Retirement Age (FRA), your divorced spousal benefit can be up to 50% of your ex-spouse’s FRA benefit. If you file before that (between the ages of 62 and 66-67, depending on birth year), the spousal share will be less.
Unlike your own benefit, divorced spousal benefits do not increase if you delay past FRA—there are no delayed retirement credits on this portion. That makes it important to coordinate your strategy carefully.
You also don’t have to choose blindly. When you apply, Social Security will generally pay you the higher of your own benefit or your spousal benefit, but not both combined. In some cases, individuals with their own work history may benefit from delaying their own benefit to age 70 (to earn delayed credits) while initially receiving a spousal benefit—but eligibility for this type of strategy has been limited under newer rules, so it’s important to confirm your options.
Survivor benefits are another critical consideration. If your ex-spouse passes away, and you were married for at least 10 years, you may be eligible for a divorced survivor benefit, which can be as much as 100% of the ex’s benefit. These rules are more flexible and can provide a meaningful income boost.
Remarriage changes the equation. If you remarry, you generally lose access to divorced spousal benefits while that marriage is in place. However, if the subsequent marriage ends, your eligibility may be restored.
The bottom line: divorce doesn’t mean forfeiting Social Security advantages. In fact, with proper planning, you may unlock additional options. The key is understanding the rules and making filing decisions that align with your long-term income strategy.
What is sequence of returns and how does it impact my retirement?
Everyone knows that some years the stock markets go up and some years the stock markets go down. And when you’re working and continuing to contribute to your retirement accounts, you can mitigate any downside impacts to your savings in those down years. However, if you retire and are forced to withdraw from your accounts during a down year, you lower your savings’ earning potential and can permanently alter your retirement possibilities. This is sequence of returns risk.
Sequence of returns risk is one of the most overlooked threats in retirement planning. It refers to the danger of experiencing poor market returns early in retirement, when you’ve just begun withdrawing from your portfolio. Even if average returns over time are strong, bad timing at the start can permanently damage your portfolio’s longevity.
Here’s why it matters: when markets decline and you’re taking withdrawals at the same time, you’re effectively “locking in” losses. This reduces the amount of capital left to recover when markets rebound. Two retirees with identical average returns can have very different outcomes depending on the order of those returns.
The good news is that this risk can be managed with thoughtful planning.
First, creating alternative pools or buckets of money, where you can have a year or two of savings set aside to pull from without having to disrupt your savings in the market, can be an efficitive mitigation strategy.
Second, be flexible with withdrawals. Instead of taking a fixed amount every year regardless of market conditions, consider adjusting spending during down markets. Even small reductions early on can significantly improve long-term outcomes.
Third, diversify your income sources. Reliable income streams that pay out regardless of what the market is doing, like annuities, can reduce your reliance on portfolio withdrawals—especially during volatile periods.
Finally, review your asset allocation. While growth is still important in retirement, being overly aggressive can amplify early losses. A balanced allocation aligned with your risk tolerance can help smooth returns.
Sequence risk isn’t about avoiding the market—it’s about managing timing. With the right structure in place, you can stay invested, stay disciplined, and protect your retirement income from the impact of early downturns.