Savvy Senior: How to handle Social Security benefits when a loved one dies

Dear Savvy Senior,

How are Social Security benefits handled when someone dies? After a long illness, my 68-year-old father has only weeks left to live. I am helping my mom figure out her financial situation going forward, including what to do about my dad’s Social Security after he passes away but could use some help.

Only Son

Dear Only,

I’m very sorry about the impending loss of your father. To help you and your mom understand what Social Security provides and what needs to be done when a family member dies, here are some key points you should know.

Your first order of business will be to make sure the Social Security Administration is notified when your father dies, so his monthly benefits will be stopped. In most cases, the funeral home providing his burial or cremation services will do it. You’ll need to provide your dad’s Social Security number to the funeral director so they can make the report. But, if they don’t offer that service or you’re not using a funeral home, you’ll need to do it yourself by calling Social Security at 800-772-1213.

When Benefits Stop

There are a couple of things to be aware of regarding your dad’s Social Security benefits. For starters, you need to know that a person is due no Social Security benefits in the month of their death.

With Social Security, each payment received represents the previous month’s benefits. So, if your dad were to pass away in August, the check for that month – which would be paid in September – would need to be returned if received. If the payment is made by direct deposit, you would need to contact the bank or other financial institution and ask them to return any benefits sent after your dad’s death.

Survivor Benefits

When your father passes away, your mother may be eligible for survivor benefits on his record if she’s at least age 60 (50 if disabled). Here’s how that works depending on her situation.

If your mom is currently receiving Social Security benefits based on your father’s work record, her spousal benefit will automatically convert to survivors benefits when the government gets notice of your dad’s death. She cannot receive both spousal and survivor benefits at the same time.

Widows are due between 71 percent (at age 60) and 100 percent (at full retirement age) of what the husband was getting before he died.

If, however, your mom is eligible for retirement benefits (but hasn’t applied yet), she can apply for retirement or survivors benefits when her husband passes away and switch to the other (higher) benefit later. Or, if your mom is already receiving her retirement benefits on her own work record, she could switch to survivors benefits if it offers a higher payment. She cannot, however, receive both benefits.

To apply for survivors’ benefits, your mom will need to call Social Security at 800-772-1213 and schedule an appointment. She can’t do it online.

You should also know that survivor benefits are available to former spouses and dependents who meet SSA qualifications – see SSA.gov/benefits/survivors.

Also note that if your mom collects a survivor benefit while working, and she’s under full retirement age, her benefits may be reduced depending on her earnings. See SSA.gov/pubs/EN-05-10069.pdf for details.

Death Benefit

In addition to survivor benefits, Social Security will also pay a one-time payment of $255 to your mom (the surviving spouse) if she was living with your dad at the time of his death. If they were living apart, she may still receive this one-time payment if she’s collecting spousal benefits on his work record. In the absence of a surviving spouse, the lump-sum payment can go to a son or daughter who is eligible for benefits on the deceased’s work record.

Send your senior questions to: Savvy Senior, P.O. Box 5443, Norman, OK 73070, or visit SavvySenior.org. Jim Miller is a contributor to the NBC Today show and author of “The Savvy Senior” book.