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Comparing Regular 60/30 Wife's Benefits with Divorced Wife's Benefits
(Posted April 5, 2003)
Question 236: Regarding Q&A 176 of this column, could you give examples comparing a regular wife's 60/30 annuity to what she could receive as a divorced wife?
Answer: The first thing to remember is that a wife can receive a full annuity (Tier 1 and Tier 2 with no reduction for age) at age 60. Here's an example in which the wife would receive her own Social Security at age 62:
|Employee's Tier 1||$1,160|
|Wife's Tier 1||$580|
(50% of $1160)
|Employee's Tier 2||$1,415|
|Wife's Tier 2||$636.75|
(45% of $1415)
|Her benefit at 60||$1,216.75|
|Her Benefit at 62||$916.75|
($1,216.75 minus $300 Social Security)
If she became divorced before 62, her Railroad Retirement would immediately end until she became 62. At 62, she would be eligible as a Divorced Spouse. Her benefit would be much smaller, because a Divorced Spouse only receives what SSA would pay. It also would be reduced, because she is under the normal SSA retirement age (age 65 to 67, depending upon her birth date).
Using the figures in the above example, her basic benefit at 62 would be $430 (about 37% of $1,160). That amount would further reduced to $130 by her own $300 Social Security.
Of course, she could receive a share of the employee's Tier 2 through the property settlement in the final divorce decree.
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