Anyone can Maximize Social Security!
Social Security is available only to those who pay into the program—about 97% of elderly Americans1. While you may think that everyone pays into Social Security, some people do not—employees of some railroads and state employees who participate in state pension programs, among others. Social Security offers participants a predetermined, steady, lifetime income based on the amount of money they have put into the program. To a certain extent, it adjusts for inflation and offers survivor’s benefits. You probably know that the longer you delay receiving your Social Security benefits, the more money you will receive each month.
WHY DO SO MANY PEOPLE GET IT WRONG? Well, it may have something to do with the fact that the official Social Security Handbook contains no less than 2,728 separate rules governing Social Security benefits. Let’s put it another way. In a recent book on Social Security planning published for financial professionals, over 40 percent of the book is devoted to a discussion of various Social Security strategies for couples! Many more pages are devoted to discussions of strategies that are designed for singles and non-traditional couples.
HOW ANYONE CAN MAXIMIZE SOCIAL SECURITY FOR RETIREMENT
You can claim Social Security millions of ways, but ZERO Social Security Administration employees can advise you and your decision can leave $250,000 of your money with the government. And you don’t get a second chance once you have claimed!
For some reason, many people don’t think of Social Security as part of their financial resources or as something that requires planning. The fact is that if you’re like most people, Social Security will represent 38% percent of your retirement income—or at least it can if you maximize it.1
Two common and threatening misconceptions about Social Security
- Social Security is simply a matter of signing up for it; there are not many decisions that have to be made.
- The Social Security administration is well equipped to help you with the sign-up process.
Both of these notions are utterly incorrect. Making an incorrect decision can leave hundreds of thousands of dollars on the table. And, in fact, the Social Security Administration is not permitted to assist you with making choices.
I took the time to become an expert in Social Security issues so that I could help my clients maximize their Social Security resources as part of their complete retirement portfolios.
Thanks for taking the time to read this material. I hope it will convince you that:
- Social Security is not just a matter of signing up; choosing how and when you receive your benefits is a complex task, and it’s an important one.
- Performing the task improperly can have severe consequences for you, your spouse, and your children.
- I am ready to assist you in choosing appropriate/optimal options for you and your loved ones.
Eligibility
What you need to know about filing for social security early…
You can file starting at age 62 however filing early permanently lowers the monthly benefit you’ll receive for the rest of your life. If you continue working after you start receiving benefits at age 62, you’re subjected to an “Earnings Limit Test.” For every $2 you earn that exceeds the Earnings Limit, $1 is withheld from your monthly Social Security benefit. Add to this, a portion of your benefit may be taxable if you continue to work after filing early.
What you need to know about social security spousal benefits…
The Social Security rules for spousal benefits are complex. The amount a spouse receives is determined by their own work record, the work record of their spouse, and the age at which the higher-earning spouse started receiving Social Security. If a higher-earning spouse files early at age 62, it permanently reduces the amount their spouse receives. However, there are strategies couples can use to maximize their benefit. Schedule an appointment with the Scott Locher at Locher Financial Inc – he understands the ins and outs of Social Security.
Other facts you need to know about social security…
At best, your Social Security benefit replaces about 40% of the income you earned during your working years. In fact, when calculating rising inflation, higher cost of living, and ever-rising healthcare costs, many experts estimate you’ll need to replace 70% to 80% of your pre-retirement earnings to live comfortably when you retire. To learn more, schedule an appointment with Scott Locher at Locher Financial Inc and receive a free Social Security Report personalized with your financial information.
Scott Locher at Locher Financial Inc can provide you with the latest information about filing for Social Security plus other ways to plan a financially confident retirement. Your free Social Security Report is personalized with your financial information to help you understand the “big picture” of your retirement.
Schedule your complimentary, no-obligation appointment today and discover:
- How and when to file depending on your personal situation.
- Advantages for married couples who coordinate the timing of their benefits.
- How Social Security timing works in relation to your 401k and IRA retirement savings.
- How to implement tax-efficient strategies on your Social Security benefits.
- And much more!
Social Security FAQ
When can I start taking my monthly Social Security Benefits?
Term Current Annual Yield: The annual yield, including applicable bonuses, up to the first penalty-free full withdrawal window (assuming current base interest rate remains unchanged for duration of the term).
Term Guaranteed Annual Yield: The annual yield, including applicable bonuses, up to the first penalty-free full withdrawal window (assuming interest rate is reduced to the contractually guaranteed minimum at the first available opportunity, for the duration of the term).
What does full retirement age (FRA) mean?
Full retirement age (FRA), also known as normal retirement age, is the age at which you’re entitled to receive 100% of the Social Security benefit you’ve earned.
Your FRA is determined by the year you were born. Keep in mind, the FRA will continue to increase in two-month increments until it reaches age 67 for those born in 1960 or later.
What are Delayed Retirement Credits?
If you choose to delay receiving benefits beyond your full retirement age (FRA), you earn delayed retirement credits that increase your monthly benefit by a certain percentage depending on the year you were born.
The increase will be added in automatically each month from the time you reach full retirement age until you start taking benefits or reach age 70, whichever comes first.
Once you reach age 70, you can no longer earn delayed retirement credits.
Is it still possible to apply for Restricted Benefits?
For those who turned age 62 prior to 2016 (people born January 1, 1954, or earlier), it is still possible to file a Restricted Application before it’s phased out by year 2023.
Restricted Application allows a spouse who has reached full retirement age (FRA) and is eligible for his/her own retirement benefit, to collect only their spousal benefit based on the spouse’s earning record.
This enables the spouse’s own retirement benefit to grow by earning Delayed Retirement Credits. At a later date, or by age 70, the spouse can then switch to his/her own maximized Social Security benefit.
What is the maximum Social Security Benefit I can receive?
Your maximum benefit is calculated using your highest 35 years of earnings and your age when you file for your benefit.
Your Social Security Statement shows the estimated benefit you’ll receive at your full retirement age (FRA), if you delay until age 70, and if you file early at age 62.
Click here to get your statement from the Social Security Administration.
What are Social Security Spousal Benefits?
Social Security spousal benefits are partial retirement benefits granted to the spouse of a qualifying worker, even if the spouse has never worked under Social Security themselves.
You can claim Social Security benefits based on your own work record, or you can collect a spousal benefit that may provide up to 50% of the amount of your spouse’s benefit.
A spouse must be at least age 62 to qualify for spousal benefits however the amount will be permanently reduced.
If you are eligible for both your own retirement benefits and spousal benefits, you will receive whichever amount is higher.
If I am widowed, when can I file for Social Security Survivor Benefits?
The earliest a widow or widower can start receiving their Social Security survivor benefits is age 60; you can start at any time between age 60 and full retirement age.
If your survivor benefit starts at an earlier age, the amount is reduced a fraction of a percent for each month before your full retirement age.
Survivor benefits can be complex – that’s why it’s important to understand all of the rules before you make a decision.
You can claim Social Security benefits based on your own work record, or you can collect a spousal benefit that may provide up to 50% of the amount of your spouse’s benefit.
A spouse must be at least age 62 to qualify for spousal benefits however the amount will be permanently reduced.
If you are eligible for both your own retirement benefits and spousal benefits, you will receive whichever amount is higher.
I’m Divorced – can I file for Social Security based on my ex-spouse’s work record?
If your marriage lasted 10 years or longer, you can receive Social Security benefits on your ex-spouse’s work record even if he or she has remarried.
Following your divorce, after a two-year period, it is no longer necessary for your ex-spouse to apply for benefits for you to receive a benefit based their work record.
If you remarry, you generally cannot collect benefits on your former spouse’s record unless your later marriage ends by death, divorce, or annulment.
