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First comes love, then comes Social Security

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Lynn McIntire adheres to a hard-and-fast rule.

“We have never been in the business of telling clients to marry if it’s simply for income tax or Social Security benefits. We will run the numbers if they request it, but we don’t tell them to do it unless there are other reasons for getting married,” says McIntire, a CFP and registered principal with Raymond James Financial Services and principal of Cadent Capital in Dallas.
By the same token, however, she and other veteran advisers recognize that understanding the rules governing Social Security benefits can be key, particularly for older couples thinking about changing their marriage status.

Recently, two female clients surprised McIntire when they told her that they had gotten married.

The clients initially told McIntire that despite the U.S. Supreme Court ruling barring all states’ bans of same-sex marriage, including the one in their home state of Texas, they had no intention of tying the knot.

But then they learned that one spouse’s employer, which had previously provided health benefits to the two women based on their domestic partnership, would no longer do so and instead would offer insurance only to married spouses.

They got married and then learned that their wedding also meant much higher Social Security retirement benefits for one spouse who had left the work force years earlier.

“Her benefits on her own were much less than what she is going to get having the spousal benefits,” McIntire says.

Jonathan Robertson agrees that Social Security benefits eligibility shouldn’t dictate marriage decisions.

But Robertson, a CFP and adviser with Abacus Planning Group in Columbia, South Carolina, had many clients, who after the Supreme Court ruling, faced the choice of getting married late in life and wanted to understand the impact on Social Security benefits.

He notes a couple of little-known Social Security benefit tactics to keep in mind when encountering marriage decisions late in life.

“If you are eligible for benefits as a widow, you lose the benefits if you remarry before you are 60. So, if you are on the cusp of 60, you may want to wait,” Robertson says.

“You must be married for nine months in order to qualify for widow’s benefits. So, marrying someone on their deathbed isn’t going to help you get higher benefits,” Robertson says.

“You must be married for one year in order to qualify for spouse’s benefits,” he says.

For those who have reached full retirement “and have been in a long-term relationship with someone who is older and [has] higher earnings, it might make sense to get married so that you will be eligible for spousal benefits at full retirement age,” Robertson says.

Miriam Rozen writes about the financial advisory industry and is a staff reporter for Texas Lawyer.

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