Improving Benefits For The Low Paid Is A Noble Goal But All But The Very Wealthy Need The Benefits In Current Law
Many households are likely to retire with little other than Social Security benefits.
Why in the world would Republicans put out a plan to dramatically cut Social Security?
Even Donald Trump said he wouldnt mess with the programs benefits. Yet, the Republican Study Committees Blueprint to Save America, released in June, has a full section devoted to Social Security. I had never heard of the Republican Study Committee , but apparently the organization has served as the conservative caucus of House Republicans since its founding in 1973, and it currently consists of 158 of the 212 Republican House members.
Read: Yes, some Republican senators really are talking openly about Social Security cuts
If the Republicans take over the House, Rep. Kevin McCarthy has not ruled out cutting Social Security. So, its worth taking a look at what a Republican plan might look like.
The proposal in the RSC document Make Social Security Solvent Again is based on a bill put forward in 2016 by Sam Johnson . That legislation would eliminate Social Securitys 75-year deficit solely by cutting benefits. According to scoring by the Social Security actuaries at the time, the Johnson plan would reduce Social Security costs at the end of the 75-year projection period by 31%.
This 31% cut is the result of three major changes:
Read: Social Security COLA 2023 benefits are rising 8.7%heres what that means for recipients
These are not rich people.
Please Answer A Few Questions To Help Us Determine Your Eligibility
Periodically checking your estimated Social Security benefits serves several purposes: It helps you plan for retirement and allows you to check for and correct errors.
The Social Security Administration keeps a database of your earnings record and work credits, tracking both through your Social Security number. You can see this information on your Social Security Statement, which is available to everyone age 25 and over. The Social Security Statement also gives you an estimate of the benefits you’ll receive at retirement age, which can play an important role in your financial planning.
Hold Off Withdrawals With A Bridge Strategy
Push withdrawals until age 70 whenever possible to maximize Social Security benefits. To do that, you may need to get a little creative.
Consider separating funding into three separate buckets: Social Security, employer-sponsored plans and personal savings.
Then ask your client to dip into one of the latter two buckets before relying on Social Security.
For individuals and couples who come up short after doing the math, youll need to talk through other retirement income options.
For instance, an annuity can help bridge the gap and add some balance to their overall retirement strategy.
This consistent and guaranteed income source might be just the thing to help clients get over the urge to take Social Security too soon.
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Three Things To Keep In Mind
For most people, Social Security benefits will represent a portion of their income during retirement yearsnot their sole source of income. It’s important to be aware of three important factors that will affect the amount of Social Security benefits you will eventually receive:
- When you choose to begin taking benefits
- Whether or not your benefits are taxed
- Whether or not you continue working
Resist The Urge To Withdraw Benefits Early
Many people think of Social Security as a system theyve paid into and can claim retirement funds from as soon as possible.
That thinking needs to evolve.
Those who claim Social Security early are losing the chance to grow their retirement income missing out on a nearly 8% increase on their retirement income for every year they delay claiming up to age 70.
The Latest
Educating clients early on the financial benefits of waiting can be a key part of building dependable retirement security.
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How Do I Talk To A Real Person At The Social Security Office
Learn about how the Social Security Administration works with Medicare and how to contact a Social Security representative.
The best way to speak with a real person at the SSA is to call your local SSA office during business hours. If your case is too complicated or urgent to handle on the phone or online, you may be able to make an in-person appointment.
You can contact SSA at the national toll-free number 772-1213 TTY: 325-0778 between 8 a.m. and 7 p.m. Monday through Friday.
The SSA provides numerous online resources to help you conduct business and find answers to your questions. If you want to speak with a real person, expect wait times. SSAs automated phone service may be helpful and avert the need to speak with a representative.
The Best Ways To Contact The Social Security Administration
Did you know that more than 2,700 rules govern your Social Security benefits? Luckily, a significant number of those rules probably dont apply to youbut how do you have a chance of interpreting all these rules on your own when there are thousands of explanations in the agencys Program Operations Manual System ?
The easy answer is to contact the Social Security Administration . Yes, we know what sort of negative connotations the idea of communicating with a government agency conjures up. Thankfully, there are three ways to contact Social Security to get info and solve issuesonline, by phone, and in person.
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How Do I Contact The Social Security Office Via The Internet
The best place to start if you want to contact Social Security via the internet is to search for ssa.gov. Set up a free My Social Security account or log in to your existing account to access your online services.
SSAs home page includes a link to contact us with the following options:
- Click to find your local field office and the national toll-free number. You will be reminded and encouraged to access SSAs online resources and frequently asked questions before you call.
- Email. Click to complete a form to send an email message to an SSA customer service representative. You will again be encouraged to access SSAs online resources. Email response time may not be prompt, but you may submit the email form if your question is not urgent or personal. Do not include your Social Security in email correspondence.
- Write. Click to get specific information about where you should send mail. Before you send mail, you should first call your local office or the national toll-free number.
- Office locator. This link will take you to the Social Security Office Locator page to input your ZIP code.
Other Fixes For Social Security
There are other options for restoring Social Security and Medicare to financial health other than raising the retirement age and cutting benefits, experts say.
Among them is raising the cap on earnings that are taxed for Social Security. Currently, earnings over $147,000 aren’t subject to the payroll tax . Another idea is to increase the tax rate for the program.
Both methods would bolster revenue for the program, although the first idea would only impact about 6% of workers who earn above $147,000 annually, while the second would impact all workers, the Congressional Research Service said in a June report.
“From a political perspective, public opinion regarding different options can vary among constituencies,” the CRS report noted.
But, the report added, policymakers need to act soon to avoid a cut in benefits to the roughly 70 million people who receive Social Security benefits a group that includes retirees, disabled workers and survivors of Social Security recipients.
Yet raising the retirement age and putting Medicare out of reach until people turn 70 may only exacerbate income inequality and worsen poverty among America’s seniors, Altman noted.
“This is an incredibly serious threat right now,” she noted.
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Report The Death Of A Social Security Or Medicare Beneficiary
You must report the death of a family member receiving Social Security or Medicare benefits. The Social Security Administration processes death reports for both. Find out how you can report a death and how to cancel benefit payments. In addition to canceling SSA and Medicare benefits, find out what other benefits and accounts you should cancel.
Myth #: Your Benefits Are Based Only On Wages Youve Earned Before Age 65
How your Social Security benefit is calculated can seem mysterious. However, its important to know a few essential facts to aid your claiming strategy. You can use the tools on SSA.gov to do the calculations.
- Your benefit is calculated based on your highest 35 years of earnings they dont have to be consecutive years or before age 65.
- If you work past age 65, those earning years will be included, so long as they are high enough to be part of your highest 35 years.
- Even working part-time after turning 65 may be part of your highest 35 years of earnings.
- To be eligible for Social Security, you must have a minimum of 10 years of covered employment , which equates to 40 credits in the Social Security system.
- If you dont have 35 years with earnings, zeros will be included in the calculation.
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Getting A Social Security Number For A New Baby
The easiest way to get a Social Security number for your child is at the hospital after they are born when you apply for your childs birth certificate. If you wait to apply for a number at a Social Security office, there may be delays while SSA verifies your childs birth certificate.
Your child will need their own Social Security number so you can:
- Claim your child as a dependent on your income tax return
- Open a bank account in their name
- Get medical coverage for them
- Apply for government services for them
Social Security Number Theft
Because Social Security Numbers have become useful in identity theft and other forms of crime, various schemes have been perpetrated to acquire valid Social Security Numbers and related identity information.
In February 2006, the Social Security Administration received several reports of an email message being circulated addressed to Dear Social Security Number And Card owner and purporting to be from the Social Security Administration. The message informs the reader that someone illegally is using your Social Security number and assuming your identity and directs the reader to a website designed to look like Social Securitys Internet website.
I am outraged that someone would target an unsuspecting public in this manner, said Commissioner Jo Anne B. Barnhart. I have asked the Inspector General to use all the resources at his command to find and prosecute whoever is perpetrating this fraud.
Once directed to the phony website, the individual is reportedly asked to confirm his or her identity with Social Security and bank information. Specific information about the individuals credit card number, expiration date and is then requested. Whether on our online website or by phone, Social Security will never ask you for your credit card information or your PIN, Commissioner Jo Anne B. Barnhart reported.
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Contacting Social Security Online
Unlike some other government websites , the Social Security website is easy to use for those who speak English and Spanish, and it offers nearly all of the services you need. The website does also offer some information in other languages online, including Arabic, Chinese, Farsi, French, Greek, Italian, Korean, Polish, Portuguese, Russian, and Vietnamese.
You can view a list of the online services by visiting the online services section of the website. Youll notice that you can apply for benefits, get a copy of your statement, appeal a decision by Social Security officials, and get estimates of your future benefits and Medicare services, among other things.
Just like the SSAs offices, the website has certain hours of operation during which you can conduct business. But take heart: If not 24/7, the hours are pretty extensive unless youre trying to apply for benefits between 1:00 a.m. and 5:00 a.m. Monday through Friday, before 5:00 a.m. or after 11:00 p.m. on Saturday, or before 8:00 a.m. or after 11:30 p.m. on Sunday, the operational hours probably wont affect you.
Most experts say to avoid visiting a Social Security officeanother reason why it’s a good idea to start with the online services section of the SSA’s website.
A You Can Continue Working And Start Receiving Your Retirement Benefits
If you start your benefits before your full retirement age, your benefits are reduced a fraction of a percent for each month before your full retirement age.
You can get Social Security retirement benefits and work at the same time before your full retirement age. However your benefits will be reduced if you earn more than the yearly earnings limits.
After you reach your full retirement age, we will recalculate your benefit amount to give you credit for any months you did not receive a benefit because of your earnings. We will send you a letter that explains any increase in your benefit amount.
If you delay filing for your benefits until after full retirement age, you will be eligible for delayed retirement credits that would increase your monthly benefit. If you also continue to work, you will be able to receive your full retirement benefits and any increase resulting from your additional earnings when we recalculate your benefits. Once you reach full retirement age, your earnings do not affect your benefit amount.
If you start receiving retirement benefits before age 65, you are automatically enrolled in Original Medicare when you turn 65. If you or your spouse are still working and covered under an employer-provided group health plan, talk to the personnel office before signing up for Medicare Part B. To learn more, read our Medicare publication.
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Look At The Big Picture
Filing for Social Security at age 70 will result in a higher monthly benefit. It won’t, however, guarantee you a higher lifetime benefit. And if you wind up passing away at a relatively young age, then you could end up losing out financially by postponing your filing that long.
Let’s say you’re entitled to $2,000 a month from Social Security if you’re FRA is age 67. Hold off on claiming benefits until age 70, and you’ll be looking at $2,480 a month, instead. That’s a nice bump, but it doesn’t guarantee a higher lifetime payout.
If you pass away at age 76, filing at age 70 rather than FRA will mean collecting $37,400 less in Social Security in your lifetime. So you shouldn’t assume that a delayed filing is automatically your best bet.
Of course, the tricky thing in this regard is predicting your own life span. That’s something nobody can do with certainty.
If you have health issues going into retirement, and your parents and grandparents passed away in their early or mid-70s, then you may want to file for Social Security at FRA or even earlier to score what could end up being a higher lifetime payout. On the other hand, if your health is great as retirement gets close and your parents and grandparents all lived well into their 90s, then filing at 70 could be a smart way to go.
Ultimately, delaying your Social Security claim until age 70 is an easy, guaranteed way to lock in a higher monthly benefit. Just make sure this route really makes sense before committing to it.
A Guide On Taking Social Security
Deciding when to take Social Security depends heavily on your circumstances. You can start taking it as early as age 62 , or you can wait until you’ve reached full retirement age or age 70 based on your work history. While there’s no “correct” claiming age for everybody, the rule of thumb is that if you can afford to wait, delaying Social Security can pay off over a long retirement. Here are some guidelines to consider.
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How To Receive Federal Benefits
To begin receiving your federal benefits, like Social Security or veterans benefits, you must sign up for electronic payments with direct deposit.
If You Have a Bank or Credit Union Account:
- Call the Go Direct Helpline at .
If You Don’t have a Bank or Credit Union Account:
- Direct Express debit card – a pre-paid debit card. Get help by calling the Go Direct Helpline at .
Make Changes to an Existing Direct Deposit Account:
On Go Direct’s FAQ page, learn how to make changes to an existing direct deposit account. You also may contact the federal agency that pays your benefit for help with your enrollment.
Putting You In Control
For over 80 years, Social Security has evolved and transformed to meet the changing needs of our customers. Today, we offer an extensive array of online services from applying for benefits to getting a replacement Social Security card, all from the comfort of your home or office! For those who prefer a more personalized service, you can always call us toll-free or visit your local field office. We provide the tools and services that put you in control. No matter where, how, or when you decide to do business with us we will always strive to provide the best experience and service to put you in control of your Social Security.
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