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CRS: Auxiliary Social Security Benefits Important, But Can Be Better

Government Affairs

Social Security, the “third rail” of retirement financing, offers more than meets the eye. It also provides auxiliary benefits — dependent benefits and survivors benefits — to the spouses, former spouses, widow(er)s, children and parents of retired, disabled or deceased workers. A recently updated study discusses these benefits and makes some recommendations regarding how they could be improved.

In “Social Security: Revisiting Benefits for Spouses and Survivors,” the Congressional Research Service (CRS) presents the structure of auxiliary benefits under current law; notes the adequacy and equity concerns of current-law spousal and widow(er)’s benefits; discusses the role of demographics, the labor market and current law on adequacy and equity; and discusses proposed changes to spousal and widow(er) benefits to address adequacy and equity concerns.

Auxiliary benefits are based on the work record of the household’s primary earner. Social Security spousal benefits (that is, benefits for a wife or husband of the primary earner) are payable to the spouse or divorced spouse of a retired or disabled worker. Social Security survivors benefits are payable to the survivors of a deceased worker as a widow or widower, as a child, as a mother or father of the deceased worker’s child or children, or as a dependent parent of the deceased worker.

Auxiliary benefits comprise a larger portion of annual Social Security benefits paid than one may imagine — the Social Security Administration reports that 33% of new benefit awards in 2017 were made to the dependents and survivors of retired, disabled and deceased workers.

The CRS cites the importance of auxiliary benefits for women in particular. “Although more women have qualified for Social Security benefits based on their own earning records in recent decades, Social Security auxiliary benefits continue to play a crucial role in improving income security for older women, as well as for young surviving spouses and children of deceased workers,” says the report. And despite the increasing number of women who qualify for Social Security, and the availability of auxiliary benefits, the CRS reports that “women continue to be vulnerable to poverty in old age, due to demographic and economic reasons.”

Some policymakers and researchers, the CRS notes, have expressed concerns about the current structure of Social Security auxiliary benefits regarding equity and adequacy. For instance, it says, “the current structure can lead to situations in which a one-earner couple receives higher retirement and survivors benefits than a two-earner couple with identical total household earnings.” It also observes that some people do not receive auxiliary benefits despite having been married to a deceased Social Security recipient or caring for a dependent of one, such as people who divorced before 10 years of marriage or mothers who never married.

There are proposals to increase Social Security benefits to some vulnerable groups, the report says, including:

  • an enhanced widow(er)’s benefit; and
  • a caregiver credit for workers who stay at home to care for young children would increase benefits for never-married and divorced women.

But those proposals have their limitations, the CRS suggests. It points out that the proposed enhanced widower’s benefit would provide income support to many elderly women and men but would not help those who divorced before 10 years of marriage or who never married. In addition, it says that the proposed caregiver credit would not help those without children, whether married or unmarried.

“The consideration of potential changes to Social Security spousal and survivors benefits involves balancing improvements in benefit equity, for example, between one-earner and two-earner couples, with improvements in benefit adequacy for persons who experience relatively higher poverty rates, such as never-married men and women,” says the CRS. It adds, “The policy discussion about auxiliary benefits may involve balancing benefit increases for spouses and survivors, divorced spouses or never-married persons with other potential program changes to offset the higher program costs in light of the Social Security system’s projected long-range financial outlook.”