Social Security Strategies for Couples

Social Security is, like many government programs, rife with confusion.

For those nearing retirement age, it would be wise to plan now to create the benefits strategy that will maximize their retirement income while allowing them to enjoy life how they wish. Most experts, such as those at USA Today, recommend using benefit optimization software or an advisor to find the ideal outcome since there are a myriad of situations that affect benefits.

Maximize Benefits by Delaying (70/70)

Mathematically, delaying social security benefits until both partners have reached the age of 70 will normally maximize potential benefits. This is true because according to the Social Security Administration, benefits rise an average of 8 percent per year (for those born after 1943) for each year delayed past full retirement age until the age of 70. Delaying will ensure the maximum possible income for both partners.

The 66/70 Strategy

This strategy works best if both partners are about the same age and have earned similar incomes throughout their careers. In this scenario, it could be best to use what’s called a restricted application. Forbes outlines the plan by explaining that one partner will first file for benefits promptly at age 66. Immediately after that, the other partner will file a restricted application for spousal benefits (50 percent of the other partner) and begin collecting those. Meanwhile, the second partner will receive benefit increases over the next four years while they continue to work. After four years, the second partner files for their own benefits which will end their spousal benefit and put both partners on their own full retirement amounts. If both partners are destined to live a very long life this strategy may not be ideal, but it does offer a good mix of income and life enjoyment!

An Argument for Claiming Early

Most experts agree that claiming social security benefits early is a poor choice, but Fidelity Investments says it can make sense in some cases. If one or both partners are experiencing health issues or expect to have a shorter life expectancy for any reason it might be worthwhile to take benefits as soon as possible to maximize enjoyment during those non-working twilight years!

Seniors Getting Locked Out of Social Security

Some seniors are being locked out of their Social Security account now for a new reason…they don’t text. Due to a new update in the system, seniors who don’t text may find themselves in a sticky situation if they need to make changes to their Social Security account.

Katie Lobosco writes in money.CNN.com ”

“It’s a security practice most of us are familiar with. When you enter your username and password, a text message with a code is sent to your phone. You then enter that code on the website to get access to your account.

In the case of the Social Security website, a new code is required each time you log in because it expires after 10 minutes. So if you don’t have a cellphone that receives texts, you can no longer log in to your account.”

While it won’t keep you from receiving benefits, it will affect your being able to change account information such as change of address, direct deposit details and requesting a replacement Social Security card.

If you are uncomfortable with the texting features on your phone, your kids and/or grandkids can teach you everything you need to know. 🙂

Read more…

October Advisor Newsletter

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You’ll find:

October FA

Senior Citizens League wants more for COLA, three percent they demand

Senior Citizens League wants more for COLA, three percent they demand

Last week the Senior Citizens League released an article demanding a higher COLA in response to the Social Security Administration’s announcement of a 1.7% increase in benefits for retirees.

About $113 Missing from Social Security in 2015, Says The Senior Citizens League.

Only a day after Social Security announced a 1.7 percent cost-of-living increase for beneficiaries in 2015, The Senior Citizens League is calling for a minimum increase of 3 percent, which was the average before 2010. The group’s leader, Ed Cates, says benefits of the typical Social Security recipient will be about $5,298 lower by the end of 2015 due to the government not maintaining at least a 3 percent increase.

Are your a senior? Do you agree? Share your feedback. We’d love to hear from you!

http://www.seniorjournal.com/NEWS/SocialSecurity/2014/20141023_Minimum-Social-Security-COLA-of-Three-Percent-Demanded-by-Senior-Citizens-League.htm

No need to spend 2015 COLA increase on health costs

No need to spend 2015 COLA increase on health costs

Here’s some great news for retirees on fixed budgets that are often stretched by medical expenses. Monthly premiums for Medicare Part B and the related deductible for 2015 will remain the same as in 2013 and 2014, according to a recent announcement from the U.S. Department of Health & Human Services (HHS).

It means retirees won’t have to spend any of the latest cost of living increase (COLA) in Social Security benefits — a 1.7 percent rise — on higher Medicare premiums.

Here Steve Vernon outlines the latest about Medicare and it’s relation to the most recent COLA developments.

In what ways have you spent your COLA in the past? Do you spend it on medical costs? Share your feedback. We’d love to hear from you!

http://www.cbsnews.com/news/medicare-costs-that-wont-be-rising-in-2015

Melody Juge Explains Why General Calculations for Solid Retirement Planning Isn’t Enough

Find out why Melody Juge, managing director at Life Income Management, tells us that

“… knowing what your living expenses are in general isn’t enough”

IN –> 9 key criteria for creating a sound retirement plan

http://www.marketwatch.com/story/9-key-criteria-for-creating-a-sound-retirement-plan-2014-10-03

Do you agree with Melody? How do you calculate your living costs AND plan for potential unforeseen ancillary expenses?

 

Is the Government Planning a Power Grab on YOUR Retirement Accounts?

Marietta, GA, September 24, 2014 – During a recent hearing on Capitol Hill with the Senate Finance Committee, the old rumors and fears of taxing retirement accounts were reborn. According to the hearing information released from the Senate Committee on Finance, Chairman, Ron Wyden (D-Ore), who wants retirement savings on the tax reform agenda, used a recent Governmental Accountability Office, analysis to support claims that:

  • incentives for savings in the tax code are not getting to the people who need them, and
  • something is out of whack with a system that he said taxpayers are subsidizing at a current $140 billion/year.

Additionally, the same GAO analysis that the Chairman referenced contained the following data

  • 9,000 of population have IRAs greater than $5 million
  • 43 million of population have IRAs less than $5 million

Sen. Orrin Hatch (R-Utah), Ranking Member of the Senate Finance committee claimed that to consider the Chairman’s claims are a “political strategy by some in Congress to turn pension policy into just another partisan battleground”.

 

The committee noted that “IRAs were never intended to become tax shelters for millionaires – they’re designed to help typical Americans save for retirement.”

The committee’s release goes onto say: “As the Finance Committee continues to work on modernizing the tax code, it should take a good look at fixing this issue. With limited resources, it’s crucial to use taxpayer dollars wisely.”

 

This language indicates that they don’t want to allow IRAs to be tax shelters, which in turn implies taxing them because it’s “crucial to use taxpayer dollars wisely”.

 

Torrid Technologies’ founder and attorney Timothy Turner says, “The committee seems to be leaning towards the idea of eliminating or reducing the ability of IRAs to shelter money for retirement. They are doing this under the guise that it’s somehow unfair for some people to have saved so much money, but the problem is once you go down this dangerous route where will they stop?  How big or small of an account do you have to have before they eliminate the tax shelter?  U.S. citizens don’t want this type of intrusion into their retirement accounts.”

 

For more information about the before mentioned U.S. Senate Committee on Finance hearing, please visit (http://www.finance.senate.gov/newsroom/chairman/release/?id=6605d837-6ab3-4bf8-938b-ce327bea119b)

 

About Torrid Technologies

Torrid Technologies offers a keep it simple retirement planning tool that allows you to hold onto a strong retirement future, even if the powers that be in Washington try to make a grab for it.  You can download a complimentary demo copy from their website at:  http://www.torrid-tech.com

 

 

 

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What are your Social Security Options?

There are a number of “Social Security Options” that you need to consider.  The biggest of course is “when to apply” to start receiving your retirement benefits.

However, there are other options.  When should your spouse file for benefits?   Can my spouse start benefits before I start benefits?  If so, how do you do that?

How can we maximize our Social Security benefits?  What does it mean to “file and suspend” your benefits?

This article from Investments News by Mary Beth Franklin discusses a number of “does and don’ts” related to your Social Security options.

Click here to go to her article called “Social Security: No double dipping allowed”

Social Security Administration – SSA

I think most everyone knows this, but the Social Security Administration (SSA) is in charge of your Social Security benefits.   So you want to visit the Social Security Administration website to do things like:

  • Apply for your benefits
  • Learn more about Social Security
  • Run some basic benefit calculations
  • Learn about Survivor benefits
  • Learn about disability benefits

You can also learn about the history of Social Security and how it came about in the 1930s under President Roosevelt’s “New Deal”.

Click here to go to the Social Security Administration Website

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