Life Insurance After Social Security
What a policy has to cover once survivor benefits are counted. Children draw on the record until they are 18, and a spouse caring for them draws too, but that stops when the youngest turns 16 and the spouse's own survivor benefit cannot start before 60. The years in between are what the insurance is really for.
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The record and the family
What the survivors would need
What they already have
Cover to buy
$350,000
$338,917 of need, rounded up
Social Security pays
$1,075,104
Over the whole period, before discounting
Cover without it
$1,025,548
The record covers 67% of what a rule of thumb would insure
Years with no benefit
7
Children grown, survivor benefit not yet open
The arithmetic
Year by year
| Spouse's age | Children | Social Security | Earnings | Need | Gap |
|---|---|---|---|---|---|
| 38 | 2 | $63,432 | $45,000 | $90,000 | $0 |
| 39 | 2 | $63,432 | $45,000 | $90,000 | $0 |
| 40 | 2 | $63,432 | $45,000 | $90,000 | $0 |
| 41 | 2 | $63,432 | $45,000 | $90,000 | $0 |
| 42 | 2 | $63,432 | $45,000 | $90,000 | $0 |
| 43 | 2 | $63,432 | $45,000 | $90,000 | $0 |
| 44 | 2 | $63,432 | $45,000 | $90,000 | $0 |
| 45 | 2 | $63,432 | $45,000 | $90,000 | $0 |
| 46 | 2 | $63,432 | $45,000 | $90,000 | $0 |
| 47 | 2 | $63,432 | $45,000 | $90,000 | $0 |
| 48 | 2 | $63,432 | $45,000 | $90,000 | $0 |
| 49 | 2 | $63,432 | $45,000 | $90,000 | $0 |
| 50 | 1 | $54,000 | $45,000 | $90,000 | $0 |
| 51 | 1 | $27,000 | $45,000 | $90,000 | $18,000 |
| 52 | 1 | $27,000 | $45,000 | $90,000 | $18,000 |
| 53 | 0 | — | $45,000 | $90,000 | $45,000 |
| 54 | 0 | — | $45,000 | $90,000 | $45,000 |
| 55 | 0 | — | $45,000 | $90,000 | $45,000 |
| 56 | 0 | — | $45,000 | $90,000 | $45,000 |
| 57 | 0 | — | $45,000 | $90,000 | $45,000 |
| 58 | 0 | — | $45,000 | $90,000 | $45,000 |
| 59 | 0 | — | $45,000 | $90,000 | $45,000 |
| 60 | 0 | $25,740 | $45,000 | $90,000 | $19,260 |
| 61 | 0 | $25,740 | $45,000 | $90,000 | $19,260 |
| 62 | 0 | $25,740 | $45,000 | $90,000 | $19,260 |
| 63 | 0 | $25,740 | $45,000 | $90,000 | $19,260 |
| 64 | 0 | $25,740 | $45,000 | $90,000 | $19,260 |
| 65 | 0 | $25,740 | $0 | $90,000 | $64,260 |
| 66 | 0 | $25,740 | $0 | $90,000 | $64,260 |
| 67 | 0 | $25,740 | $0 | $90,000 | $64,260 |
A dash marks a year in the blackout: the children have aged off the record and the surviving spouse is not yet old enough to claim. Nothing arrives from Social Security in those years however large the benefit is.
How it works›
What the record pays. Each child draws three quarters of the insured's full benefit until 18, or 19 in secondary school, and a spouse caring for a child under 16 draws the same. The family maximum caps the total, so a family of three or more is cut back in proportion. The spouse's own survivor benefit starts no earlier than 60, at 71.5% of the benefit, rising evenly to the whole of it at their survivor full retirement age.
The need. Each year's need less what the record pays and what the spouse earns, with the shortfall discounted back to today at the rate you set. Spending and income are in today's dollars, so the rate to use is a real one: what the money would earn above inflation. Debts and final expenses are added at full value because they are paid at once.
What it leaves out. Tax on the survivors' income, a spouse's own retirement benefit after their survivor benefit, the earnings test, which withholds a survivor benefit while the spouse works before their full retirement age, and any benefit the spouse has earned on their own record. The comparison figure assumes no Social Security at all, which is what an income-times-years rule of thumb assumes.
Reference sources. These sources support the component rules. Model choices and exclusions are described in the notes above.SSA: family maximumSSA: survivor benefits