Category: Financial and taxes in retirement
July 4, 2020 -- Our friend Robert Powell at TheStreet.com just wrote a very helpful article for people who worked for governments or non profits and did not pay into Social Security for much of their work lives. They are usually concerned that they won't get Social Security retirement payments. In "Did You Work for a Government and Not Pay Social Security", Powell writes to straighten out some misconceptions.
The Windfall Elimination Provision (WEP) reduces your Eligibility Year (ELY) benefit amount before it is reduced or increased by early retirement, delayed retirement credits, cost of living adjustments (COLA), or other factors. If applied, your Social Security retirement payments will be lowered.
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Published on July 4, 2020
Comments 6
Category: Social Security
May 4, 2020 -- When the coronavirus pandemic first arrived on our shores one of the first thing many people added to their list of worries was its potential effect on the viability of Social Security. Those of a negative mindset were drawn to two main concerns about its funding: shortfalls caused by the vast number of newly unemployed not making FICA payments, and new distributions made to people forced to take their Social Security retirement early at 62. The effect, they hypothesized, might be that the Social Security Trust Fund would become exhausted earlier than expected, and promised payments to retirees would have to be either trimmed or subsidized by the federal budget.
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Published on May 4, 2020
Comments 15
Category: Social Security
April 21, 2019 -- Deciding when to take Social Security retirement benefits is always a complex question. Now the devastating impact of Coronavirus is making it even harder. Here are some thoughts that might help on a question that always has many possible answers.
The New York Times reports in "Taking Social Security During the Pandemic" that workers in the past decade have shown a steady trend of postponing when they take Social Security, as a way to increase their potential lifetime retirement benefits. Whereas most workers still take Social Security the first chance they get at age 62, to get higher benefits more and more have been waiting to their Full Retirement Age (66-67), or even to age 70. With the arrival of the coronavirus pandemic experts are wondering if that trend will stop, or even reverse itself.
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Published on April 20, 2020
Comments 2
Category: Financial and taxes in retirement
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December 28 , 2019 — Social Security is the single most important source of retirement income for most people. So it is crucial that you understand how the rules apply to your situation. Here are three important things you need to understand about how Social Security works.
1. Know when to claim
The earliest you can claim is age 62. Your Full Retirement Age (FRA) is somewhere between 66 and 67, depending on your birth year (if born before 1954 it is 66 and increases one month per year after that up to 67). Your benefit maxes out at age 70; there is no advantage in waiting past that. if you file at age 62 you will only get 75% of what you would get if you wait to your FRA. If you claim between your FRA and 70 your benefit will increase by 8% a year. You can file for your benefits online or in person.
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Published on December 28, 2019
Comments 10
Category: Social Security
December 11, 2019 -- You can always expect a lively debate on this subject: should you wait to claim Social Security, or take it as early as age 62? No matter your opinion, it is indisputable that claiming later than your Full Retirement Age (66 or later) provides an attractive 8% increase per year yield (plus COLA). Now a new study suggests that the 8% per year reward for waiting is too high, and the penalty for claiming early is too severe. Note: Shoutout to Maimi for bringing this study to our attention!
The study, "Are Social Security's Actuarial Adjustments Still Correct", comes from the Center for Retirement Research at Boston College. When Social Security started to allow beneficiaries to claim early or delay to age 70 it used actuarial adjustments designed to keep lifetime benefits constant for an individual with average life expectancy. In other words, no matter when you take your Social Security benefits, the odds are that you will receive the same amount of money.
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Published on December 10, 2019
Comments 11
Category: Social Security
November 18, 2019 -- Late last month it was announced that Social Security and Supplemental Security Income (SSI) benefits for nearly 69 million Americans will increase 1.6 percent in 2020. This follows increases of 2.8 percent in 2019, 2% in 2018 and .3% in 2016.
The 1.6 percent cost-of-living adjustment (COLA) will begin with benefits payable to more than 63 million Social Security beneficiaries in January 2020.
The maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $137,700, up from $132,900. Separately, Medicare.gov announced that Part B premiums in 2019 will increase by $9.10 a month to $144.60 for most recipients.
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Published on November 18, 2019
Comments 16
Category: Financial and taxes in retirement
April 8, 2019 -- Your Social Security benefit is one of the pillars of your retirement. To make the most of it you need to make smart choices on how and when you take it. Make a wrong move based on misinformation or lack of knowledge, and it could cost you and your spouse tens of thousands of dollars in the years ahead. This article will go over a few of the areas that seem to trip up the most people. To help answer these questions we used information from the very helpful SSA.gov website. Use these examples to help inform your own decisions, along with your own careful research.
Choices...and Decisions
It is up to you to apply for Social Security retirement benefits. If you don't apply, you won't get them. You have your first option to start receiving retirement benefits when you turn 62. Taking them then gives you the smallest monthly payment, but it is money in your bank account now. You can apply at any time from age 62 on, but your monthly benefit will go up for every month you wait to claim (benefits are capped at age 70).
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Published on April 7, 2019
Comments 2
Category: Financial and taxes in retirement
(Updated October 3, 2018 - with an important new development) --July 18, 2018 -- Back in May we reported on our experience of applying online for our Social Security retirement benefits. The plan was to have the application completed and accepted in time to start receiving benefits in August, 2018, the month we turned 70 years old. Here is our report on the final two chapters in that process. (You can read the entire report, including this update, at "Applying Online for Social Security- Our Experience".
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July Update - Not quite there yet!
Since I filed my application in mid May I have been waiting to see what would happen with it. I did receive a letter from SS saying my application had
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Published on July 17, 2018
Comments 7
Category: Financial and taxes in retirement
May 16, 2018 -- (Updated July and October with more experience). Back in March I received a letter from the Social Security Administration - "It is time for you to register for your retirement benefit!" I was impressed with their timing and efficiency, since my 70th birthday will be this August. Nicely done. This article will chronicle my experiences in registering for my Social Security retirement benefit online - lessons learned that hopefully will help others when it comes time to claim their benefits.
My decision was to wait until age 70 to claim. Fortunately we have been able to afford to live without that benefit so far. That blessing, coupled with very good genes (my parents' average age before departing this earth was 97), made it seem like a good bet to wait until 70. That way I could capture the 8% increase a year for delaying from age 66, and then enjoy that extra money for a long time past the breakeven point in my late 70s (and my wife after I pass). Time will tell if that was a good move or not.
Registering for Social Security retirement benefits
My plan and hope was to register online, and not have to spend time on the phone or waiting
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Published on May 15, 2018
Comments 13
Category: Financial and taxes in retirement
Updated Oct. 2023 - There is no shortage of articles on how to "maximize" your Social Security benefit, often from some of the top experts in the field. Some of them advocate taking the benefit early, but just as many advocate waiting. It's a complicated subject, but the best answer lies in understanding your personal situation.
This article provides 5 reasons why we think taking your Social Security retirement benefit is nowhere near as simple as you might think. We will also give
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Published on October 10, 2016
Comments 59
