Social Security and You

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July 15, 2013
Yes, even you. The rules for Social Security are complex and whether you are 35 or 55, single, married, or divorced, rich or poor, it is time to start thinking about social security – now.Young adults can track their benefit information through the Social Security Administration (SSA) website’s “My Social Security” tab. The website shows the worker’s historical earnings, estimated benefit, and assumptions made by the SSA. Check the SSA’s earnings records against the worker’s tax return and ensure there is an accurate entry for each year.When a couple marries, the parties gain the ability to share in each other’s social security benefits. A nonworking spouse can earn up to
50 percent of a retired worker’s full benefit. Using an online calculator or a financial planner, a married couple can strategize to maximize
their combined benefits. One way a couple can leverage the rules
and maximize benefits is for the higher earning spouse to collect on
the lower earning spouse’s benefit at full retirement age (66), while continuing to build their own retirement credits until age 70. At 70, they can switch to their own benefit.The ability to file for a spouse’s benefit can survive the marriage. If you are single, at least 62 years old, were married to your ex-spouse for at least 10 years, and not already receiving a benefit greater than your ex- spouse’s benefit, you are eligible. You may file for spousal benefits even if your ex-spouse hasn’t started drawing on their benefits. It may also be possible to change your election. Rest assured that your inquiry or filing with the SSA will remain a private affair – it will not be reported to you ex-spouse.

When a person approaches retirement age, social security becomes a numbers game. For those born between 1943 and 1954, full retirement age is 66. A person can take social security as early as age 62, but their benefit will be reduced by about 30 percent. Factors including age, health, other sources of income, and the availability of a spouse’s benefit are at play. Educate yourself as to the system and anticipated benefits. Form a team including an attorney, CPA, and financial planner. Together you can maximize your social security benefits, and develop a contingency plan should social security go the way of the dinosaurs.