Do you remember this video from 2019 about All Bob’s Money? We jokingly refer to Caroline’s Social Security payment every month as Bob’s Money. (I honestly feel a little funny about the money. At the same time, David worked decades for her to qualify for this benefit and I think it’s the first time our family has ever come out on the positive end of any niche government monetary policy.)

If you don’t know what I’m talking about, I included the explanation below the video. I mentioned the Social Security situation in the Discourse over the summer, but a lot of people probably never saw it. 

I cannot guess how much time I spent reading and watching videos about Social Security over the past several years. But I never heard about this dependent benefit until I read about it in a comment under a YouTube video.

As people wait longer to have children, a special benefit comes into play. If you have a child aged 18 or 19 who is still in high school when you turn 62 and you start your Social Security, your child can also claim a benefit until she graduates from high school.

The golden part is that even if you retire at 62, your child’s benefit is calculated as if you had actually retired at Full Retirement Age.

So here is what that means. David took his Social Security at 62. Caroline was 18 when he started last spring (turned 19 this month) AND she is still in high school. She can therefore receive a monthly Social Security benefit equal to half of his full retirement age benefit. It doesn’t matter that he is taking a smaller amount now at 62. She still gets half of his full retirement amount. She will get that through next June when she graduates. 

This is why they ask on the Social Security application if you have any children aged 18 or 19 and still in high school. We thought it was a weird question, but had never heard of this provision.

Depending on how much your full retirement amount is and how long your child will be 18/19 and still in school, that can add up to a hefty amount over many months. The child can use it however she wishes – education, training, buying a car, or simply building a nest egg. Caroline has used some of it strategically, but has saved quite a bit already. We calculated with her how many hours she would have to work each week at a job that paid something like $15/hour to help her comprehend how much she’s getting. (She’s not had a job outside the home yet.) She is incredibly blessed to get this money and she understands that. 

Caroline took some of Bob’s money and bought me a special surprise over the weekend. That is the subject of another post.