The Social Security lump-sum death benefit is a one-time payment made to:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Social Security pays a small lump-sum death benefit — currently $255 — to the surviving spouse who was living with the worker or eligible for benefits on the worker's record; if there is no surviving spouse, it can go to a child eligible for survivor benefits. It is not distributed to named beneficiaries under a life insurance arrangement, does not go to the estate as a general rule, and never goes to the employer. The amount is far below what most families need, which is why the benefit is often cited when explaining the need for private life insurance.
Why the other options are wrong
- B) The lump-sum death benefit is paid to the surviving spouse or an eligible child, not to named beneficiaries in equal shares as under a life policy.
- C) The estate receives the death benefit only in limited circumstances. The surviving spouse or an eligible child is the primary recipient of the lump sum.
- D) Employers have no right to the deceased worker's Social Security death benefit. The payment is intended for the worker's survivors.
Memory hook
$255 from Social Security — a round for the grave, which is why private life insurance is the real fix.