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No Social Security

July 19, 2011 by USA Post 

No Social SecurityNo Social Security, This is the sixth time this year I wrote about Social Security (1) here the first sentence of my column of April 4.: “One of the most important financial decisions that are related to when and how retirement is going to apply for Social Security.” It’s good to know I’m in good company: Both the AARP and the widely respected Center for Retirement Research at Boston College recently released resources to help retirement approaches appropriate financial decisions. Bad investment and spending options can result in significantly lower receipt of income for the rest of his life.

It is no coincidence that an increasing amount of attention paid to this issue. It is certainly not because the rules for the collection of Social Security have changed recently. (. They do not have) I would also say that not because the system’s financial situation continues to deteriorate – which should come as no surprise to anyone. Anyone at any time in the last 15 years math and looked at the assumptions involved in this program has seen it coming. In my opinion, the reason for the focus is on how retirees can maximize Social Security benefits is reduced to demographics. In other words, it’s personal.

As we saw with Gerber baby food, hula-hoops, Levi, minivans and many other examples, when something catches the attention of the Baby Boomer generation large and influential (of which I’ma member) that jumps to center stage issue.

This year, 75 million Americans – those born between 1946 and 1964 – are between 47 and 65 years of age, ie early retirement or are beginning to prepare for it. As a result, Social Security is no longer a ‘theoretician’ of program income from the government that their parents or grandparents have, which is suddenly very, very real to them boomers.

If you have never been married, deciding when to begin receiving Social Security is simple and essentially based on your individual financial situation: If you start when you reach your “full retirement age” (FRA) in the number 1 year to receive 100% of the amount you’ve earned. Each year thereafter the benefit will be adjusted annually for inflation. If you apply for benefits at any time before the FRA (the earliest age 62), receive less for each year between the FRA and age 70 to postpone the start of benefits, the amount increases.

Deciding when to begin receiving Social Security, in essence boils down to whether you need the money. If you are single, does not work and have other sources of retirement income, it is obvious you need to begin receiving benefits immediately.

However, when you throw marriage or divorce or widowhood in the equation of the decision is exponentially more complex. Are you better off claiming a benefit based on their own work record or if you opt for a “spouse” benefit based on their current / ex / history of your deceased spouse’s employment? If you start with one of the options, under what circumstances can change the other, anyway? Assuming you are married, is it better for one spouse to start collecting at 62 and wait another 70 years to when his / her benefit will be much larger? If so, which starts early and wait? Or if both files when each reaches full retirement age?

Social Security Web site is one of the best sources of information does the federal government, but at the same time providing the rules, you will be directed to the collection strategy more advantageous. Furthermore, the terminology is not always as clear as expected.

AARP’s Social Security benefits calculator is a great step in the right direction. By answering some basic questions that will tell you the criteria that will likely result in the greatest benefit of all life – even if you are or were married. In addition, you can customize by entering the amount of your projected benefit of the letter from Social Security sends each every year just before his birthday.

AARP is clear: unless serious health problems or financial organization believed to be in your best interest to work as long as you can – the longer you wait to start collecting, the bigger your check. “It offers a guide,” says Jean Setzfand, vice president of financial security for AARP. “This illustrates the benefit of waiting for the claim.”

The program takes you through a series of screens that show how the age at which you begin receiving Social Security affect the size of your paycheck. If you are or were married, based on the income you earn and your spouse tells you at what age is because each file, and if one of you must make on the basis of his or her own history or your spouse work.

If you start benefits before reaching retirement age and continue working landfill, there is also a display showing the amount of your Social Security benefit will be reduced. However, since they do not have to “lose” that money, but also illustrates how much more will receive once you reach your FRA and benefits were withheld are returned.

In the case of my husband and I, we were advised that opens the Social Security and immediately suspend benefits when he reaches age 67. Since it would be 66 years (my FRA) at the time, I would claim a full “marriage” benefit. Then we both wait until age 70 file / re-file for benefits based on our own individual work records. Thanks to the “delayed retirement credit” that we both receive much more income.

The calculator is not perfect. That does not allow you to test all possible scenarios that could be considered as a married couple. But hopefully, these will be added sometime in the future. But it’s a start. And now it is best free calculator claiming Social Security available. Anywhere. Hands down.

I say “Bravo!”

Before boarding, I recommend reading the guide social security claims in writing by the folks at the Center for Retirement Research. Not only covers some issues of the calculator, and these two resources to reinforce the importance of carefully choosing when and how to begin Social Security benefits and help you make a more informed decision.

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