While reviewing “Your Social Security Statement,” the document available on the Social Security Administration (SSA) website, you may notice a section for survivors and wonder if the Social Security Administration covers any funeral expenses. The short answer is no; however, there are survivor benefits that may help.
Social Security eligibility
Most people are required to meet the criteria of having accumulated at least 40 credits over a lifetime of working before they are eligible for Social Security benefits. A maximum of four credits can be earned in one year. Therefore, the typical SS applicant would have a history of working and paying SS taxes over the course of at least 10 years. Income may be derived from employment with an organization or from self-employment. For purposes of Social Security benefits, the earliest retirement age is 62. If “Your Social Security Statement” includes estimated benefits, that signifies you have earned enough to qualify. Young people applying for disability or survivor benefits need less credits to be eligible.
Monthly survivor benefits
If you have earned sufficient credits for your family to obtain survivor benefits, the statement will break down estimated monthly benefit amounts for your:
- Spouse who is caring for your child.
- Spouse, if benefits start at full retirement age.
- Total family benefits maximum.
Social Security benefits to the beneficiary cease upon death. The family is required to return any payments received for the month of the death or any months that follow. The example provided by the SSA is that if someone dies in July, any benefit paid in August must be returned to the SSA because it is paid in arrears. However, family members eligible for a monthly death benefit are allowed to receive their benefit payment for the month the beneficiary passed away.
One-time death benefit from SSA
In addition to the monthly benefits for certain family members, a spouse, or a minor child if there is no surviving spouse, may be eligible for a one-time payment of $255. This can be put toward cremation or burial expenses. It seems like an odd amount, and you may be curious how this came about. The concept of a death benefit through the SSA began in 1935 when the agency did not offer other survivor benefits. The amount was capped at $255 in 1954 and, for some reason, has not been reevaluated since.
To be considered for the lump sum death benefit, the SSA requires the completion of an extensive form. Supporting documents must accompany the form, including certificates of birth and death. Access the form on the SSA website, or call your local SSA office.
Notification to the Social Security Administration
Planning for the event of death is a difficult discussion to have with your family, but it is important. Many people discuss financial planning but find the topic of funeral arrangements more sensitive. However, it is critical that the SSA be contacted as soon as possible after the beneficiary’s death to ensure eligible family members receive the benefits for which they are entitled. If there is a funeral director involved who is given the deceased’s Social Security number, the director can remove that burden from the family and call the SSA directly.
For additional information on this subject, read “How Social Security Can Help You When a Family Member Dies.” It is published in English and Spanish. This and other helpful publications can be found at ssa.gov/pubs/. Type “survivor” in the search field to navigate directly to relevant material.