Social Security Inside Out

Sample of Social Security Inside Out

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Sample of Social Security Inside Out         Sample of 46 Retirement Pitfalls

Retirement Benefits

Question: Should I start my benefits at 62 years old or wait until I reach my Full Retirement Age?

Answer: That depends on how long you are going to live. If you will live to 78 years old, the total money you would get from Social Security would be the same either way. Let me show you a comparison of James and Mary (the most popular names for babies born in 1943) who are eligible for retirement on their own records with each due $1000 at 66 years old (their Full Retirement Age).

In, Social Security Inside Out, and 46 Retirement Pitfalls, I cover the many reasons to take benefits early or to wait until later. With this information, YOU will have the knowledge and confidence to determine the best time to start your Social Security benefits.

Antsy Jim starts checks at 62 so he gets only $750 per month because of the 25% early retirement penalty. From age 62 to 78, he will get $750 a month for 16 years for a total of $144,000. Smaller checks ($750) but more of them (192).

Patient Mary waits until she is 66 so checks are the full $1000 per month. From age 66 to 78, she will get $1000 a month for 12 years for a total of $144,000. Larger checks ($1000) but fewer of them (144).

James and Mary won’t know who made the correct decision until after they die.

If James dies before he is 78, he was money ahead by taking checks early. If he lives past his 78th birthday, he will get $250 per month less than Mary will for the rest of his life.

If Mary dies before she is 78, she lost out in total benefits. She didn’t live long enough getting larger checks to make up for missing checks from 62 to 66 years old. However, if Mary lives past her 78th birthday, she will get $1000 a month for the rest of her life, which is more than the $750 for poor James.

• Since you lose about 6.6% a year by taking benefits early, putting your retirement checks in an investment that pays about that amount could offset the reduction. It may be advantageous to get checks early to pay down bills with interest of over 6.6%.(The workbook covers the numerous pros and cons of each retirement age.)

• A reason against taking benefits early is that your surviving spouse may end up getting lower benefits as a widow or widower. The effect on future survivor benefits depends on the percent of your early retirement penalty and the date that your surviving spouse starts checks. (This effect on survivor benefits is clearly explained in the survivor section of the workbook.)

Question: Should I wait until I am 70 to get the extra bonus?

Answer: You receive a bonus called Delayed Retirement Credits if you don’t start checks until after you reach your Full Retirement Age (Chart of ages is in my book.). Your retirement payment increases by 2/3 of 1% for each month (8% a year) that you don't receive checks after your FRA up to age 70.

I show you a moneymaking, but rarely used, way to get Social Security checks at Full Retirement Age and still get the bonus on your retirement at 70 years old.

Let’s say, Mary is very patient and waits to start her retirement checks at 70. Instead of getting $1000 at 66 (her FRA), she will get $1320 when she is 70. However, she will have passed up $48,000 ($1000 X 48 months) from 66 to 70. She will have to live past about 82 1/2-years-old to be money ahead.

Question: What can I do to make sure I get all that I am due?

Answer: After years of reviewing cases as a supervisor, I learned that the public needs to pay close attention to these five error prone areas:

1. Earnings Record
2. Month of Election
3. Benefits
4. Disability
5. Significant Birthdays and Life Events

You will learn what to do in each of these areas to make sure you are not shortchanged when dealing with SSA.

Spouse Benefits

Question: Since my husband made more than I did, will I get retirement from his record or from my work?

Answer: First, you receive your own retirement if you worked 10 years. Then you may get an extra amount from your husband’s record. Through easy to follow examples, you will learn how to figure the check amounts for you and your spouse.

Learn the rarely used way to get checks as a spouse even when the worker hasn’t retired.

The workbook shows many moneymaking options available to a couple (or divorced couple).

Widow/Widower Benefits

Question: If I die, how much will my wife get?

Answer: Basically, she is eligible for your Full Retirement Age amount plus any extra bonus from Delayed Retirement Credits. (All of these Social Security terms will make complete sense after you read my book.) The actual amount of her check depends on her age and whether you took early Social Security retirement.

You will learn how to switch back and forth between retirement and survivor benefits to get the most from both programs.

Usually, figuring out the widow/widower check amount can be complicated because of so many variables. However, my easy to understand charts in Social Security Inside Out make it clear.

When I was checking a rule, I called Social Security with a simple question. The employee’s answer didn't seem right so I called a second time. The next employee, after checking with a supervisor, gave me the correct answer. Of course, this doesn’t mean that half of all Social Security workers are wrong and that the other half of them always needs to check with supervisors. However, don’t you want to make sure your case is processed correctly? Read my workbook and check with more than one Social Security employee if you have concerns.

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46 Retirement Pitfalls

These are just a sample of the answers and insider tips in Social Security Inside Out.