Well, good afternoon everybody. Thank you so much for joining me today to learn a little bit more about social security. What baby boomers need to know before their ret uh um about their retirement income. Uh this is a pretty uh popular topic that I do. I do this pretty much every quarter. I do this four times a year and uh usually get a lot of questions and a lot of people would like to get together usually typically after these to discuss what when to take social security in relation to the rest of their retirement whether they should take it early or wait to take it later at you know maybe at a reduced amount early or an enhanced amount later uh what works in your specific plan. I’m going to go through this presentation here and I hope that you at the end of the presentation you will select yes when I put up the survey at the end if you would like to have a one-on-one conversation uh and it’s a no obligation no um you know so and this is a complimentary thing that we do uh these presentations and the full retirement plan that is also a complimentary thing that I do offer of many people that I talk to say here’s what I have. Here’s what I want. Am I on the right path? Can I retire when I want to? Should I take social security early? Should I take it on time at my full retirement age or potentially even later? And this complimentary plan that I do offer, it’s very comprehensive and it’s certainly something that you could take advantage of just to find out what you should be doing in retirement. How should you be invested? More aggressive, more conservative if you’re going to to retire at 65 or 66 or 67. And uh people say, “Well, should I be backing off on my investments?” Maybe, maybe not. Uh hopefully, you’re still a long-term investor um at that age. So, um it’s certainly something that you and I can look at together um as we talk about your retirement plan.
Uh I do have to share that because this does come up quite a bit on every presentation that me and my team that we do uh we are not able to uh record and distribute these or even the deck or the slides uh on these. So uh and we do have to tell other people that you are not allowed to record and distribute these presentations as well.
Uh I do have coming up some other presentations. Uh savvy tax planning, different types of retirement accounts and traditional Roth taxable accounts uh like brokerage or savings that you get taxed on every year. What does all this mean in your retirement? Learn a little bit about that Tuesday, September 8th at 6:00 p.m. Central time. Uh this is uh for educational purposes and again this is the do not distribute. So, sorry about that.
Uh, next presentation I have is Wednesday, September 23rd. Uh, that’s the home stretch, the seven things to do before retirement. Uh, that’s also another popular topic talking u many different stages of as you get close to retirement, everything that you should be looking at is uh that’s a very good uh presentation for that. Uh you do have access to a lot of our um educational resources here at Alliant. You can see what other webinars you can uh take a screenshot if you want to take a picture of this page and you can certainly look up uh to see what webinars uh are coming up, different topics that you might be interested at at various times. We do have other people that do presentations in other states uh in California, in Colorado, in Texas, Utah. We have someone doing presentations there. And here in Illinois, our uh invests podcast you can listen to. And our Aerys uh Alliant Retirement and Investment Services, that’s what the Aerys stands for. Our website and blog. Uh this is a lot of the things that I do offer. uh this is you know complimentary uh financial planning the upper left there again that’s what I uh had mentioned uh certainly different types of advanced planning when we look at you know when you someone should be doing Roth conversions uh converting from a traditional IRA to a Roth IRA estate planning is a very um important thing that you should be hopefully looking at whether it’s trust wills powers of attorney uh power of attorney for healthcare power of attorney for financial matters, um, investment management. Again, a big thing that we do, we have, um, uh, quite a bit of assets here at the credit union and also in in our investment accounts that we do manage. Uh, so it’s certainly something that uh, is available to you in investment management, our comprehensive range of investment choices, many different if you are ultra-conservative to ultraaggressive. Hopefully, we can help you. My name is Joe Gaspari. I am one of the financial consultants here at Alliant Retirement and Investment Services. I’m an Alliant employee. Uh, and this is again something that we do. Uh, you know, a very a complimentary thing and hopefully uh I will get to know you more on a one-on-one basis as I do uh talk about options available to you of uh what’s available for different types of retirement planning. I hope you and I will have a one-on-one conversation. So, as we get going, people are hurting their retirements by making terrible, costly decisions about Social Security. As I go through the presentation here today, if you do have any questions, you do have access to chat box or the Q&A question and answer box. If you think of a question as I’m going through the presentation e if a slide sparks something uh go ahead and type a question in in one of those the chat or the Q&A and those will hold till the end of the presentation and I will take those questions at the end and I’ll remind that a couple of times during the presentation. Things to know about social security. You have many different claiming options. Decisions have far-reaching consequences. Choice impacts both spouses. So, if you are going to take social security early, if you happen to pass away when you pass away, uh if you have a surviving spouse still, are they going to be getting a higher income or a lower income based on when you take your social security system is not bankrupt nor Ponzi scheme? We’re going to talk uh at the beginning here about how social security is funded and how long it’s going to last and what happens in about the 2033 34 35 range. Uh benefits helped a family member and your friends friends are not the experts. Just because a friend or relative does uh a strategy of social security that may be uh tip appropriate for you but it may not be appropriate for you. So, it’s certainly something that you and I can have that conversation to find out what is best for you. Uh, baby boomers want to know. Will social security be there for them? Uh, how much uh can they expect to receive? When should they apply for social security? How to maximize the benefits? And will social security be enough to live on in retirement? Understanding the value of social security. Will it be there for you? So, in social security, how your so our social security trust fund is funded is through our paychecks. Um, or if you’re self-employed, you pay into social security. If you’re a worker working for a company, 6.2% of your income goes into social security. If you are working for a company, then that company matches your 6.2%. So, 12.4% 4% of your income goes into the social security trust fund. So at the end of 2024, we could see that this trust fund was worth $2.721 trillion. And then in 2005, $1.449 trillion is funded into out of our paychecks into the Social Security trust fund. And then 1.6 6 trillion went out to pay people on social security. So these numbers were reversed a little bit a few years ago, not that long ago. There was more money coming in than there was going out. Now there is more money going out than there is coming in. We could see that that uh that shortfall was $229 billion last year. And how much will it be this year? We’ll find out. Um but we see this trust fund balance went from 2.721 trillion down to 2.561 trillion. So every year that is starting to tick down. What does that look like on this pretty chart here is we could see uh that what is going out is the orange line. That’s the schedule payments. And you could see back in the early 2000s there was more money going or coming in than there was going out. And then that passed where it switched where there’s more money going out than there is coming in. And now we’re starting to see that trust fund go down because they’re covering that shortfall in the year 2034 35 in that range. It is projected if nothing is done that this could go to a zero balance. And if it does go to a zero balance, it doesn’t mean that social security is done. It’s when we look at that middle box there where it says payable benefits as a percent of scheduled benefits. We could see in 2034 that about 81% is going to be covered. So is there going to be reduction in pay in 2034? uh and then be beyond and then 299 and even lesser percent. So PE it’s a it is a pay as you go strategy where money comes in every year and money goes out. Now, there’s more people coming out of the workforce than there is going into the workforce with baby boomers retiring at record levels. And every year, every day, some more people are retiring, coming out of the workforce, eventually going on social security. And then there’s some people coming into the workforce, but there’s more going out than coming in. So, what are some of the fixit on here? Right now, if you make more than $184,500
uh in 2026, if you make that or less, then 6.2% of every paycheck goes into uh the Social Security trust fund. If you make, let’s say, 200,000 of income, that 15,500 does not get taxed, the 6.2%. So everything above 184,500 does not pay 6.2%. So if someone’s making 250,000 500,000, a million or more, uh they are only paying social security taxes the 6.2% on their first 184,500. So are they going to increase that? Are they going to make it more 200,000 250,000 everyone all income? Who knows what is going to happen there? But uh but that is certainly one of the things that could be done. Raise the normal retirement age currently. I mean it was 65 then it was 66 and then 66 and 2 months 4 months 6 months 8 months 10 months and then now it’s 67. Uh so are they going to make younger people wait till 68, 69 or even 70? Uh lower benefits for uh future retirees. So, are benefits going to be cut or are they going to start to take away the cost of living adjustments? Uh, statistically about a 2ish% is what the annual increases are to social security income. Some years is much higher, but then there’s been years where there has been no raise. There are no years that social security will be reduced though. Uh, they’ve protected that, but there are have been some years in the past where from one year to another there is no raise. Uh and then we had in 2023 uh after the big high inflation in 2022, there was a uh what 8.7% increase in social security in 2023 because of the high inflation. Then it went down to 5.9% the next year, then 3.2 the next year. Now we’re back in the twos again for social security increases on average. The bottom line for baby boomers, your benefits are not likely to be uh affected by social security reform. Uh you know, people that are on social security now. So, what’s a clear way to think about social security? It’s an inflation protected income. You’ve paid the premium and every paycheck. So, be smart about how you and when you collect. Social Security offers income you can’t outlive. If your monthly income, let’s say $2,000 a month, uh, that you are receiving today, and if you last 10 years on social security, that would be $262,793.
This is assuming 2% annual increases in that income. If you live 20 years, that is 583,000. 30 years on social security with those increases. Little under a,973,000 is the total income uh received from social security. What does that look like on a paycheck if you have uh with those annual increases? If you’re getting $2,000 a month today with average of 2% annual increases in 10 years, your income will be 2438. 20 years 2972 and in 30 years 3623. Every year we hope to get that on average 2% cost of living increase. It’s a little bit under what national average inflation is. Talk about a uh 3ish% in uh in inflation on an average. some years higher, some years lower. But statistically, if there’s a cost of uh you know, a living uh if the things cost more the next year, your social security will go up, but probably not as much. Uh the good and the bad when we talk about um you know, with social security increases is that’s a good thing. Uh typically, if you’re on social security and you’re on Medicare, your Medicare Part B payments come out of your Social Security payment. And it seems that every year there’s an increase in social security income, uh, Medicare premiums go up, too. So, you don’t you’re not getting quite the full raise because the typically uh that Medicare premium comes out um a little bit higher each year as well. How much can you expect to receive? It’s how much you earned over your working career, the age at which you apply for benefits. So at age 62, your earnings are tallied and uh indexed for inflation. So uh if you work till age 62, that’s kind of when your numbers are calculated. It’s based on your highest 35 years of working, not your last 35, not the last average of the, you know, some people think, isn’t it the last 5 or 10 year average, it’s your highest 35 years of working. They have this AIME, average index monthly earnings calculation that they do out of all your 35 years of working. I could tell you that if you had, let’s say, 30 years of working, maybe you took some years off, maybe you were raising children, you had 30 years of working, it’s still based on your highest 35. So you will have 30 numbers and you will have five zeros that bring your average down. Now if you work one more year 31 years now you have 31 numbers and four zeros. So your average will increase. So but it is based on 35 numbers whether those are income or zeros. Uh so they do have this uh funky calculation when they’re doing these um you know on how much you’re they’re doing. what they’re doing kind of behind the scenes to figure out your exact income is based on the age that you take it and what your income has been over those years. Benefit is increased each year by cost of living adjustments. Uh it’s good to know, but why shouldn’t I claim as early as age 62 instead of delaying till full retirement age? And we’ll look at those ages or even 70. That’s the latest you can take it for an enhanced amount for a higher income. Your monthly benefit will be reduced if you claim early. It may also be reduced for taxes and Medicare premiums. Uh and benefits could be withheld if you work. If you take it early and you work, you could be your benefits are uh withheld from you. And we’ll look at exactly how that works. I’ll throw another reminder that if you do have a question and so um on this topic, uh go ahead and type it in the chat box or the Q&A box. question and answer box and I will get to those at the end. When should you apply for benefits? Uh health issues, health has a big uh effect on that. Life expectancy, need for income, sometimes you just have to get that income sooner than later. Uh whether or not you plan to work and survivor needs, remember when we talked about if you take a lower number, if you pass away, your spouse could potentially get a lower uh in I’ll call it inherited amount. um or that spousal benefit amount I’ll say. Uh but uh if you wait and delay and you pass away and with a higher income that spousal benefit could be higher for that survivor. So when I talk about health status I talk about my my parents situation typically my dad uh my dad had his first heart attack at age 49. He had a heart attack heart attack heart attack. He had another bypass at age well he had a bypass at 51 and then he had another bypass at age 64. So he had a lot of heart issues. Uh so when he turned 62 he was I’m taking it while the taken’s good. I don’t know long how how long I’m going to be here. Uh he did end up passing away at age 75. Still financially it was not a bad decision to take it early. uh that break even is usually in that late 70s, 78 to 80 years old or so. Uh that if someone thinks, okay, if I live that long or longer, maybe I should wait to take it. Um because those higher income uh that higher income will be compounded so much more uh for those years that you’re on social security. But if you do pass away younger in your late 60s or even early 70s, some people will say then well maybe you should take it early. However, we don’t know when those dates will come. Uh that day that comes for each of us. So, uh it’s certainly something that how do we plan this for whether you are here for a shorter time in retirement or a longer time? That’s what that retirement plan that I’m offering is going to help with uh with that decision. Will social security be enough to live on in retirement? Probably not. uh for many people uh full retirement age. So based on your birth year, so if you could just see what year you were born, uh you could see when your full retirement age is, I could say that 1959. If you were born within the next two months, you’re going to be at your full retirement age in October. If you were born December of 1959, you will be 66 and 10 months this October. um then that is your full retirement age. Other than that, everyone else is age 67.
What if you apply early for benefits? How does that look? How much of a reduced benefit will you be getting? So, looking at the middle column, age 66, the FRA means full retirement age. Uh so, this is the full retirement age of 66. You can see it’s a 100% benefit. If that person took it early at age 65, it’s about 6.7% taken off. And if you’re 64, then you get 86.7% of your full benefit. 63, 20% is taken off. And 62, 25% is taken off. Now if you are age uh you know full retirement age as 67 and you took yours as early as 62 30% is taken um that you do not get by taking it that early. Some people have the argument but that’s five more years of income. Um isn’t that doesn’t that do better again that break even is between age 78 and 80. uh that yes you do get longer more years of income but that reduced income uh compounding with those cost of living increases of average 2% um that income does not compound as fast as with higher numbers that will be started if you take it later. What if you even delay it? What if you don’t want to take it at 66 or 67 and you want to delay it to get an even higher income? If your full retirement age is 66, um then you can get as uh 132%. You can get 32% more by waiting until age 70. So you could see the increments of how much more you get at 67 68 69 or 70. But if you are able to delay at till 70, uh that’s a big increase in that income. So some people will say why would I delay that long? Um, some of the reasons are that some people will say maybe I’ll just love live off of my own assets until then. Um, you know, because you’re paying taxes on social security income. Hopefully not right now until 2028. I’ll touch on that a little bit more uh with the uh the taxes uh the tax changes from last year and how that’s affecting uh taxable income for social security and those additional deductions for social security. So, if your full retirement age is age 67, the most you can get is a 24% increase by waiting until age 70. So, how do you find your estimates? Um, ssa.gov will get you there. Um, you’ll have to create a login. If you have not done this, you’re going to create um a login for this so you can uh and I get emails every year after we file taxes. Excuse me. After we all file taxes, then social security gets your income and it kind it adjusts your average. Did you have higher income? Did you have lower income or even no income? And every year your numbers are updated. And I get an email, you know, a few months after I file. It says, “Your new Social Security numbers are ready to view.” And then I can log into the Social Security site to see what my income is going to be based on the various ages. And you can go on. It’s a very uh userfriendly site once you’re in there that you can say, well, what if I took it at, you know, my full retirement age is 67. What if I took it at 66 or 65 or 64? And I can just plug those in and it tells me exactly what I’m going to be getting based on today’s numbers. And then what if I delay it till 68, 69, or even 70, it’ll tell me those numbers as well. Uh, so you have a few different websites here, but ssa.gov gov will get you there. Why delay benefits? So, this is uh we’re going to look at the column where it says 67, age 67 or I’m sorry, the row that says age 67. Uh so, you can go across there and it is that’s the 100%. So this is the full retirement age of this hypothetical person is age 67 and their income going to the right is 3,000 a month based on their um you know uh their previous income years and things like that. So they are eligible for 3,000 a month. If that person is 62 today and they see these numbers they say well if I take it at 62 I’m going to get 2100. That’s that 30% knocked off. Uh or if I wait till 63 and 64. Now to the column to the right of that, the far right column is showing what your income is would be with 2% annual increases. Um so you could see those numbers a little bit higher because it’s assuming a 62y old by the time you’re 67 it won’t be uh 3,000 a month. It’ll actually be 3,312. uh if there are average of 2% cost of living increases. So the middle column is showing just the raw numbers and the right column is showing that if there are an average of 2% annual increases. Here’s where that makes a difference. Or even if you wait till age 70, what that income looks like and you could see there’s a big difference on the far column to the right taking it at 62 at 2100 versus 70 at 4359. That is a big difference in income.
So more income later on. So when we look at if you are if you claim at age 62 uh by the time you’re 70, your 2,000 a month will be uh I’m sorry, your 3,000 a month benefit uh will be at age 62 uh is 2,400. Um let me go back a screen. I’m so sorry. It would be 2100. that 2100 by the time the person is 70 would be 2460 all the way out to age 100 you could see it’s 4457. Now look to the if you claim it at 67 by the time you’re 70 that income is 3500 age 100 6300 and if waiting till 70 there’s a big increases now and the higher your income is the more those compounded 2% annual increases can be affected. Uh so you can see there’s a big difference but again what is your specific need? Do you need to take it earlier? Do you just want to take it earlier? Uh just for your specific lifestyle, whatever is going on at that age. Uh but uh that’s what that hopefully if you say yes, that uh that retirement plan that I can offer will help us figure out or help you figure out when should you be taking social security. Should you take it earlier, on time, full retirement age or even later based on your specific uh what other assets that you saved? So again, another reminder just uh that if you do have some questions, I know there’s a couple uh that you can uh type away in the chat box or the Q&A box and ask away and I’ll get to those at the end. So, how do you maximize your benefits? Uh logging in, you could see make sure number one, it’s accurate. Uh are there any years missing? Was there any income? Mine seemed pretty spot-on when I had logged into mine, but you never know if there are any errors. somewhere and can you improve it by working longer? So, if someone’s going to re if you’re looking, let’s say you’re 58 years old, just to throw out an age, you’re 58 and you’re saying, I think I’ve saved enough, I would love to retire now. Um, and then when you’re going to look at your social security income in the future, again, the earliest you can take it is 62. Um, and then your full retirement age would be 67. So, you’re 58 years old, you’re thinking you want to retire and you see your social security numbers, but just so you do know if you’re under the age of 62, there is an assumption that you’re going to keep working making similar income. So, you do have there is a way to show that to say that if your income is going to stop uh then you can uh work with social security to say or on the site to say if I’m not going to have income after the age of 58. So, um, maybe so how much is my social security going to be if I don’t continue to work? Cuz if you remember, your income is calculated at age 62.
Apply for Social Security at the optimal time. So, consider your income needs both now and in the future, your life expectancy, and your spouse’s life expectancy. Again, for spousal death benefits, is that going to carry over to uh a lower number to the surviving spouse or a higher number? Taxation of benefits. First, we’re going to look at what does this if you take your social security early. This is not if you take it at your full retirement age. This page only applies if you take your social security before your full retirement age at 66, 65, 64, 63, or even 62. If you apply early um and you make more you choose to work and you make more than $24,480 and that’s what the number is for this year 2026. Um if you make more than that $1 of every two is withheld uh from social security. So we said that earlier that if you make too much money if you take it early then there could be benefits withheld. That’s what this is doing. So, $1 of every two is if you make more than 24,480. If you make up to that, maybe you just want to work a part-time job, you take your social security early and you just want to make, you know, 10, 15, 20,000, it’s fine. Nothing will be withheld. It’s only if you make more than that 24,480 just to make sure. If you are full retirement age, if you are age, let’s say you’re 67, your full retirement age is 67, you start social security, but you do not uh stop working. You continue to work. You can make as much as you want and you do not it doesn’t nothing is withheld. Uh so there this I’ll call it penalty quote unquote penalty is only if you take your social security early. uh and the benefit will be adjusted. Now, this is where where I say you don’t lose it. It’s your the benefits are withheld, but they are readjusted when you get to your full retirement age. So, let’s say it’s your turn 67, you took it early. Yes, you worked, you got $1 of every two withheld in the past. It’s all going to be recalculated. Uh so maybe your income would be adjusted hopefully a little higher um at age at your full retirement age in this example age 67. Uh don’t let the annual earnings test discourage you from working. Sometimes you have to do what you have to do. If you need the social security and the job income uh to avoid uh the earnings test, wait until your full retirement age or later to apply for benefits. Again, if you wait till your full retirement age, nothing is withheld. taxation of benefits. So, um how does that work and how much taxes would you pay? So, on here, I’ll cover this first. So, if you are married filing joint, that is the top row here. Um under if you make under 32,000, what they call provisional income, and this is your what’s called your adjusted gross income. Uh if there’s any earnings, interest earnings, dividends, anything that is taxable on here, uh it is your adjusted gross income plus one half of your social security benefit plus any tax-free interest like municipal bond things. If all that is under 32,000, you do not pay taxes on your social security. If it’s between 32 and 44,000, up to 50% of your social security can be taxed. And if it’s over 44,000, then up to 85% of your social security can be taxed. The nice way to say it is that 15% of your social security is tax-free. So up to 85% of your social security can be taxed. Now, we’ll talk a little bit about what’s going on with this 6,000 credit that you know is uh or deduction that some people will get if you’re 65 or over. And if you’re on social security, you can get an additional $6,000 deduction each. So if you’re a single filer, 6,000 deduction. If you’re married filing joint, a $12,000 deduction. But this only goes through to the year 2028. So is that going to be extended beyond that? Is that going to be just stopped? Who knows what’s going to happen? But for now, some people are enjoying an additional 12% deduction. your income has to be below 150,000 a year to get that additional deduction or 75,000 if you’re a single filer. And if you’re on social security, you want that other uh that uh 6,000 or 12,000 deduction. Your income has to be below those levels. 75,000 for a single filer, 150,000 for married filing joint. And you can see also for if you’re a single person where those taxes fit or married filing separately. If you are married filing separately up to or 85% of your social security is automatically taxed. Ways to minimize taxes on social security. Reduce other income or tax advantage investments. Uh anticipate I IRA RMDs required minimum distributions. Uh just so you do know that once you are the age of 73 and beyond and you have to take out of social security I mean out out of your IAS let’s say you have to take out 10,000 20,000 30,000 depending on how much you have in these IAS determines how much you have to take out each year and that is all part of that adjusted gross income. So even if you have no or little income, but if you have to take out big IRA distributions, then your income will be higher and you could pay more taxes on social security then just because of having IRA withdrawals. And I get that you does it have these discussions when people say, “Well, that’s my money. What I mean, yeah, I know I’m paying taxes on it, but why would that affect something else when I’m just withdrawing my own money?” But that’s the way that is. you can start to convert before you take social security. I do have people that are deferring social security until age 70. And even if they retire at 65 or 66, at age 66, 67, 68, 69, they are starting to convert from their traditional IAS to their Roth IAS. While they’re not taking social security yet, so they don’t have to worry about paying taxes on it. They’re trying to stay within an a moderate maybe a 12 or maybe even a 22% tax bracket converting moving money from a traditional IRA to a Roth IRA. It is a taxable event, but there is absolutely strategy of when you should be doing Roth conversions. Uh and part of that uh that retirement plan that I’m talking about uh offering to you is that uh Roth conversions is a big part of that conversation if that works in your plan. Delay social security uh reduces a number of year your years your benefits are taxed. Uh reduce expenses, pay down debt, adopt a simpler lifestyle. Sometimes easier said than done on that u that line. uh continue to manage taxes throughout retirement. And that retirement plan, we do a forecasting of every year in your retirement, how much you’re anticipating taking out of required distributions, what does your tax uh situation look like going forward. And again, that complimentary plan will help us determine that Medicare can shrink your check. So, here’s where Medicare comes in. Uh so Medicare uh if you’re on Medicare and on social security, your uh payments currently at $22.90 comes out of your social security payment. So your direct deposit will be whatever your income is going to be uh is going to be $22.90 less and then it could be even lower if you choose to withhold taxes from your social security. So, um, you know, very important to know that yes, once you’re on social security, you’re on Medicare, that your Medicare payment does come out of your Social Security payment. When to apply? If you apply early, your benefits start lower and they stay lower for life. Uh, meaning even though with you get the 2% cost of living increases, but you’re compounding on a lower number because you took it early. Cost of living adjustments, colas, magnify the impact of early or delayed claiming. The longer you live, the more beneficial it is to delay benefits. Uh, your benefits may be taxed and reduced uh to cover your Medicare premiums. Don’t let the earnings test discourage you from working. Delay benefits uh delaying benefits may give surviving spouse more income. I’m not going to live long, so why shouldn’t I just claim my benefits when I can? For couples, you should always uh maximize the higher earners benefit to perfect uh protect the surviving spouse. So, here’s an example of uh that we have John and Jane. John makes uh is going to make $2,000 a month in his social security. Jane worked a lot less, maybe took some years off, and her benefit is only $800 a month. When Jane applies, assuming um that Jon applies first and Jane applies at her full retirement age, she is guaranteed to get at least 50% of the primary earners income. So that 2,000 that he’s getting, she will get a,000. So the 800 goes away and she gets a,000 even though she worked less. or even if she didn’t work at all and never even qualified for benefits because she didn’t uh pay into it uh because she stayed home with kids or just did not work for whatever reason. Um that she would still get that thousand a month.
Primary worker must file first. The spouse must be at least 62, but if the spouse does take it at 62, it’s reduced for her age um uh calculation. and no delayed credit efforts for uh so if the spot if the husband in this case if John waited till age 70 to take his uh the uh Jane in this example does not get 50% of his age 70 number she gets 50% of his age 67 so there’s no uh delayed credits for her for the spouse coordinating spousal benefits there are some strategies where maybe some maybe one spouse will take it early, one spouse will take it later. That’s what this is saying that maybe the lower earnner um primary is more than 50% of the of the higher earnner, both spouses delay till age 70. In this example, it’s what if the lower earnner is less than 50%. Maybe the lower earner starts early and then the higher income earner waits till 70. So the retirement plan that I’m offering is certainly something that we could look at. Should you both take it early? Should you both take it late, one early or one later? First of all, what are your income needs? Let and then we start to look at what does this all mean for the longevity of your plan. So that’s something that uh you know we could certainly look at. One takes it early, the other waits. Or you both take it at your full retirement age uh and find out what’s best for your specific plan. Well, I’m already widowed or divorced. So, how does this impact your social security strategy? If you are widowed or divorced, you may be eligible for survivor benefits or divorced spouse benefits or divorced spouse um survivor benefits that can increase your monthly check. So the age uh sur the survivor benefit if there is a a primary earner let’s say passed away and the survivor it depends on when the initial person applied for social security at the age which the deceased spouse uh originally claimed the benefit or the original benefit. If the deceased spouse claimed before the full retirement age, survivor benefit will be limited to the higher of the deceased spouse benefit or 82.5% of the deceased. Um, so what’s going to be higher? So that’s certainly again what you and I can talk about. If that’s uh if this slide pertains to you, we can schedule that time to speak to find out how much uh benefits what’s the best to take for you. If the deceased climbed after the full retirement age, the survivor benefit um will include delayed credits. Uh survivor uh benefit will depend on the age at which the widow claims. If the survivor claims before full retirement age, the survivor benefit will be a fraction of the original benefit 71.5% of the uh deceased amount if claimed at early as early as age 60. So as a deceased uh spouse um benefit the survivor will um can claim as early as age 60 but it is a reduced amount. If survivor claims after full retirement age the survivor will be 100% of whatever the original person’s income was. If some of this is more confusing again some of these may slides may pertain to you some may not. um please say yes at the end when we and we can go through this your specific numbers what’s best for you if the spouse dies while both are receiving benefits. Uh so how does that look? So Joe and Julie are married. Uh both are over full retirement age. Joe’s benefit is 3600. Julie’s benefit is 1,800. If Joe dies then her 1,800 goes away and she gets Joe’s 3600. So Joe dies with the higher income, uh she gets the better of the two. So if hers was higher and Joe passed away, of course she would keep her own higher income. But again, if uh if his is higher, then uh she gets the better of the two. So Joe and Julie are married. Joe, this is for delayed uh claiming. Uh Joe’s is 3600. He delays until age 70, which his 3600 would be end up being 4,464 because of the enhancements of 24% more. Joe dies, Julie survivor benefit will be the 4464. So, this is where it’s very important to figure out what is best for the couple’s plan, not just the one person of, you know, just that I want to take it because I want to take it. Uh this is going to be what’s going to what if something happens to one of you, what is the survivor going to get? And that’s part of that planning. Uh so let’s see where we are on time. We’re pretty good so far. Uh couple must have been married at least 9 months for that benefit. Survivor must be at least age 60, but it would be a reduced benefit or 50 if that survivor is disabled or um full retirement age for the full benefit. survivor benefit not available if the widower or widow or widowerower remaries uh before age 60. Uh divorce spouse survivor uh benefit available if the marriage lasted for at least 10 years. So again, as I’m starting to get get a little bit closer toward the end here, I do want to just say if you do have any other questions, type away in the chat box or the Q&A box and I will get to those at the end. Divorce spouse benefits. So if you have uh a divorce situation and the primary earner let’s say I’m going to use the husband as an example in this that he has uh a higher income and the divorced um wife in this case the ex-wife wants to take benefits off of the divorced husband uh then that is certainly possible but you have to be married at least 10 have been married for at least 10 years that if the person receiving divorce spouse benefit is currently unmarried. If you get remarried, that takes that off the table. Uh the expouse is at least age 62. And if divorce was more than 2 years ago, ex- spouse does not need to have filed for benefits. So, um if uh if there’s a little bit of an age difference, sometimes uh if the the higher earner has not filed yet, the uh the ex-wife in that example that I was saying, um she can still start her spousal benefit even though he did not file yet. Divorce spouse rule. So, more than one expouse can receive benefits from the same worker’s record. I’m going to use an example of this at the end. Benefits paid to one expouse do not affect those paid to the worker or the current spouse or other expouses. Uh divorce spouse benefits stop upon remarage of spouse collecting benefits uh not upon remarage of the primary worker. So, if you are on um uh expouse benefit and you get remarried, then your benefit those ex those spouse benefits will stop and then you’ll have to wait till your full retirement age or take what you’re eligible for.
Really more complicated complicated than you realize. So, should you take yours early? Should you take it way later to get a a bonus? People are hurting their retirements by making terrible costly decisions about social security. Uh so we’ll just do a little quick recap. Social Security offers an inflation protected income. You can’t outlive. Your monthly benefit will be reduced if you claim early. Couple should always maximize the higher earners benefit for the surviving spouse. If you’re widowed or divorced, you may be eligible for benefits u that can increase your check. Uh if you would like to have that analysis done on yours on when you should take it, I would love to have that conversation. I’ll be putting up that survey here shortly. Uh consider or things that we will certainly take into account is what other income do you have? What other savings have you done? IAS, 401ks, brokerage, any other accounts that you’re going to be living off of. How is this going to affect when you take your social security? As I finalize uh the presentation, I’m just going to get into uh this final little story. And I heard this when I went to a uh you as an adviser went to a social security presentation 20 years ago probably. Uh but the story is how this expouse and current spouse benefit works uh for social security. So here’s the story that I had heard and it’s a let’s say you have a 25year-old male and a man and he gets married to a woman who is also age 25. Uh they are married for 10 years and at age 35 they get divorced and just for the sake of this let’s say 10 years in one day just to make sure it was 10 years. Uh so 10 years later they get divorced. He immediately gets remarried at 35 and gets divorced again at 45. So now he gets remarried again at 45 and gets divorced again at 55. So now he’s got three ex spouses. Uh so now he gets remarried at at um at 55 and he’s now they’re all age 66 67 full retirement age. So this person has three ex spouses and one current spouse. And in this scenario he starts his social security. And let’s assume that none of the expouses ever worked. They never got remarried. They never put into social security. They can all get, let’s say, the the primary earner, let’s say he’s going to get $3,000 a month in his social security. Expouse number one gets 1,500. Expouse number two gets 1,500. Expouse number three gets 1,500. And current spouse number four also gets 1,500 off of one worker. uh interesting scenario, but that can actually happen. So, uh uh very interesting on how uh social security works sometimes. Uh but that’s one of those funky things that uh why is that there? Um so, when should you apply for benefits? What if you keep working? What if you um what if you’ve already applied? How much will your benefit be? Can you coordinate with spousal benefits? What’s the best long-term strategy for your situation? And what do I do next? you and I will hopefully have that one-on-one conversation uh to get into what’s important to you. Here’s again that list of uh all the products and services that I offer here. And I’m offering that blue one in the upper left and that’s the complimentary retirement plan. Uh so my com my contact information is up on the screen here right now. You could take a screenshot of that or if you even would like to have that conversation one-on-one, you can actually uh get your camera on your phone and hover it over that QR code and tap on the little yellow thing that comes up and you will get access to my calendar. You can schedule an appointment right now if you would like to. So, with that, I’m going to take some questions. uh the questions that are up here and I am also going to be putting up the survey right now which I just did. So hopefully you see that on your screen. If you would like to talk um please say yes and we will I will get back to you and we can schedule a time. So with that I will go through some questions here. Uh how long does it take um from filing to first check? Uh they say it could be a couple of months uh depending on how back they are but you can do it as soon as three about three months early you can start to apply. I wouldn’t there have been you know and I’ve talked to people that yeah I did it the month before and I got it. Uh but I would do it at least a couple of months before because your payments will start typically on at the beginning of the uh of your you know the month that you’re you’re selecting to start. Uh but I would give it at least two months. uh when would Medicare premiums uh convert from quarterly to monthly? Uh if you if that is referring to maybe you’re not on social security yet, if you are on Medicare right now but not on social security and you’re mailing in payments quarterly, it just automatically will come out of your social security uh payments um every month once you start your social security. If one delays receiving Social Security, do we still have to register at 65? Uh, that’s for Medicare. You don’t have to um signing up for Medicare is an age 65 thing. Uh, but you don’t have to do anything with social security income uh at 65 cuz your your full social security might be 66 and 8 months, 10 months, or even 67. Uh, so you do not have to do anything with social security, but you would have to get, you know, start activating Medicare at age 65. You don’t have to do anything with social security. But I will say the Medicare signing up for that is on the social security site, but you don’t have to do anything with your income um on social on the social security site at 65. Okay. So, my situation is complicated. How can I set up an appointment? Uh, so yeah, just hopefully you were one of the yeses on here that you and I can have that one-on-one conversation. Um, here’s another how far in advance that was also on there for to apply for Social Security. I would do it uh at least 2 months earlier before you wanted to start. If I choose to semi-retire at age 67 and keep working um on a part-time basis, how does that affect your Social Security income? Uh if you do if assuming age 67, that’s your full retirement age. Um that if you want to make as much as you want, you can absolutely do that. It will not affect your social security income at all. The only thing that actually that it will affect is that if you’re working while on social security, but you’re if it’s at your full retirement age or later when you’re not penalized, like I said earlier, um your income could potentially even be increased for your social security in the future if your working income is still part of your highest 35 years. So, if you’re making good income, you’re on social security at your full retirement age and you want to start uh or keep on working making good income, you’re fine. Doesn’t affect your social security. In fact, your social security could be increased. It will not be decreased if you make low income. So, just know that. Uh let’s see if there’s anything else. I think that is all the questions that I do have right now. Uh yep, that’s it. And so, thank you all so much for your time and attention. I hope that you and I will have a conversation really soon uh based on your situation. If you did say yes, uh we’ll be scheduling a time here very soon. Thank you all so much for your time and attention. Thank you. Have a great rest of the day.