When someone passes away the money that he or she has invested in Social Security is not necessarily wasted. Dependents might be able to claim it through survivor's benefits.
Social Security is essentially a forced retirement plan. We put money into the program and receive it back when we retire in the form of monthly payments. Obviously, it is more complex than that, but that is the basic idea.
On the other hand, unlike other retirement plans, we do not name a beneficiary for our Social Security. It does not automatically go to anyone else we choose when we pass away. That does not mean that all the saving was wasteful.
Some people can claim survivor's benefits and get the benefit of that saving.
The Lowell Sun recently listed who might be eligible for those benefits in "Social Security has survivor's benefits."
The list includes:
- Widows/Widowers – A widow or widower can get full survivor's benefits when he or she reaches retirement age or sooner if taking care of a child under the age of 16.
- Divorced Widow/Widower – Someone who was married to the deceased for at least 10 years may be able to get survivor's benefits.
- Minor Children – Children of the deceased under the age of 18 are eligible for the benefits. If still a full-time student, then benefits are available until the age of 19. Benefits can be claimed at any time if the child of the deceased became disabled before the age of 22.
- Parents – If a parent depended on the deceased for at least half of his or her support and the parent is over the age of 62, then the parent is eligible for survivor benefits.
The Social Security Administration is unlikely to chase you down if you are eligible for survivor's benefits and are not claiming them, so if you have any questions about your eligibility, consult with an elder law attorney.
Reference: Lowell Sun (Jan. 24, 2016) "Social Security has survivor's benefits."
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