sss webinar 02 spousal and survivor benefits slides
3/19/2014
The Top 3 Mistakes to Avoid with Spousal and Survivor Benefits
For advisor use only — not intended for general distribution
Agenda • Spousal and Survivor Benefits Primer • Common Claiming Mistakes with Case Studies • Take-Away Materials • Q&A
© 2014 Social Security Timing®. All Rights Reserved.
1
3/19/2014
Common Claiming Mistakes
Higher earner files early
Both elect after FRA
Improper coordination of benefits
© 2014 Social Security Timing®. All Rights Reserved.
Spousal and Survivor benefits primer
For advisor use only — not intended for general distribution
2
3/19/2014
Spousal Benefits John’s primary insurance amount at full retirement age is $2000.
• Maximum Benefits of up to 50% of your spouse’s PIA (Not benefit amount) • To Qualify – Married at least 1 year – Primary worker must have filed – Generally must not qualify for a benefit of your own that is equal to or greater than ½ of the primary workers Primary Insurance Amount (PIA)
Jane would be eligible for ½ at her full retirement age - $1000!
© 2014 Social Security Timing®. All Rights Reserved.
Why “Up To?” • Reduced for early claiming • Reduced by the greater of the Spouse’s Retirement Benefit amount or the PIA
© 2014 Social Security Timing®. All Rights Reserved.
3
3/19/2014
Filing for spousal Early/Late • Reduced on a faster schedule if filing early
• No delayed retirement credits on spousal benefits
RIB
SPOUSAL
62
75
70
63
80
75
64
86 2/3
83 1/3
65
93 1/3
91 2/3
66
100
100
67
108
100
68
116
100
69
124
100
70
132
100
© 2014 Social Security Timing®. All Rights Reserved.
Top-Up Primary Wage Earner PIA - $2,500 $1,400 $1,200 $1,000
$260
$0
$500
$800
$1,250
$600 $400
$990 $750
$200 $0 Age 66
Age 70
Spouse's Retirement Benefit
Age 66
Spousal Benefit
© 2014 Social Security Timing®. All Rights Reserved.
4
3/19/2014
File Before FRA? Deeming Applies • Before FRA – File for own • Reductions apply
– File for spousal (if available) • Even greater reduction for taking spousal early
• You cannot take a spousal only before FRA* • Strategies available
* Unless you don’t qualify for a retirement benefit © 2014 Social Security Timing®. All Rights Reserved.
Survivor’s Benefits • At death of first spouse, surviving spouse receives highest of: – His or her own benefit – Benefit of the deceased – 82.5% of the FRA benefit of the deceased
Once John passes, Jane will receive a higher benefit of $2000*
• The lesser benefit disappears *Assuming John elected at FRA and Jane Claims Widow Benefits at or after her Widow FRA. © 2014 Social Security Timing®. All Rights Reserved.
5
3/19/2014
Survivor’s Benefits Widow benefit is based on when the Deceased filed, and when the Survivor files. 3000 2500 2000 1500 1000 500 0
60
61
62
Deceased at 62
63
64
65
66
Deceased at FRA
67
68
69
70
Deceased at 70
© 2014 Social Security Timing®. All Rights Reserved.
Switch Strategies® • Prior to FRA “Deeming” applies • After FRA, can pick and choose • “Switch Strategy” is filing for a limited benefit and then later “Switching” to a larger benefit
© 2014 Social Security Timing®. All Rights Reserved.
6
3/19/2014
What makes Switch Strategies® possible? Allows an individual to file, then request checks be stopped. During the period in which no checks are received, will earn delayed retirement credits.
Allows an individual to limit an application to only one benefit, which may allow another benefit to receive delayed credits. Each spouse gets both – spousal and solo…
File & Suspend
Switch Strategy Enablers Restricted Application
© 2014 Social Security Timing®. All Rights Reserved.
Married Case Study • John and Jane are both 66 today – John’s benefit is $2400 and Jane’s full retirement age benefit is $1100 per month
What are the possible Switch Strategies?
• Their advisor suggested that John take at 70 and Jane take immediately © 2014 Social Security Timing®. All Rights Reserved.
7
3/19/2014
Several Switch Possibilities • John Files & Suspends, making the spousal benefit available to Jane • John files a Restricted Application for spousal benefits • John Files & Suspends, Jane files a Restricted Application for spousal only benefits, then switches to her own benefit at 70 If no “Switch Strategy” is employed, this couple is leaving at least $26,400 on the table © 2014 Social Security Timing®. All Rights Reserved.
Watch Out! No cross-claim for married couples, even though you may read about it…
© 2014 Social Security Timing®. All Rights Reserved.
8
3/19/2014
Common Claiming Mistakes
Higher earner files early
Both elect after FRA
Improper coordination of benefits
© 2014 Social Security Timing®. All Rights Reserved.
Case Study • Jeff is 64 yrs old, Lorraine is 60 yrs old • Jeff is the high wage earner - $2,000 Social Security benefit at 66 • Lorraine is the lower wage earner - $500 Social Security benefit at 66 • Life Expectancies – 85 and 90
© 2014 Social Security Timing®. All Rights Reserved.
9
3/19/2014
What’s at Stake?
$191,280
© 2014 Social Security Timing®. All Rights Reserved.
Earliest Strategy Total Benefit: $756,072 Jeff • File a standard application for benefits at age 62 years. Your approximate benefit on your own earnings record would be $1,453 Lorraine • File a standard application for benefits at age 62 years. Your approximate monthly benefit would be $725. This represents a benefit of $375 on your earnings record plus an additional spousal benefit of $350.
© 2014 Social Security Timing®. All Rights Reserved.
10
3/19/2014
Jeff’s PIA - $2,000 75% - $1,500
Lorraine’s PIA - $500 75% - $375
Less real COLA
© 2014 Social Security Timing®. All Rights Reserved.
Suggested Strategy Total Benefit: $947,352 Jeff • File a Restricted application for only your spousal benefit based on Lorraine's earnings record at your age 66 years. This allows you to continue to earn delayed retirement credits on your own benefit. Your approximate spousal benefit would be $250 • File for your own benefit at age 70 years. Your approximate benefit on your own earnings record would be $2,639. Lorraine • File a standard application for benefits at age 62 years. Your approximate monthly benefit would be $375. • When Jeff files for his own benefit, you will become entitled to an additional spousal benefit of approximately $499, This should be applied automatically, but if it is not, contact your local Social Security office. © 2014 Social Security Timing®. All Rights Reserved.
11
3/19/2014
Suggested Strategy
© 2014 Social Security Timing®. All Rights Reserved.
What happens when the Higher Wage Earner dies early?
For advisor use only — not intended for general distribution
12
3/19/2014
Husband Dies at 70 - Earliest Total Benefit: $653,326 Jeff • File a standard application for benefits at age 62 years. Your approximate benefit on your own earnings record would be $1,453 Lorraine •
File a standard application for benefits at age 62 years. Your approximate monthly benefit would be $725. This represents a benefit of $375 on your earnings record plus an additional spousal benefit of $350.
© 2014 Social Security Timing®. All Rights Reserved.
Husband Dies at 70 - Earliest
© 2014 Social Security Timing®. All Rights Reserved.
13
3/19/2014
Husband Dies at 70 - Earliest
© 2014 Social Security Timing®. All Rights Reserved.
Husband Dies at 70 - Suggested Total Benefit: $795,508
(Earliest was $653,326 )
Jeff • File a standard application for benefits at age 66 years • Immediately request that your benefit payments be suspended. This allows you to continue building delayed retirement credits on your record, but makes Lorraine eligible to claim spousal benefits on your earnings record. • When you reach age 70 years, request your benefits be paid. At this point, your approximate benefit would be: $2,639 Lorraine • File a standard application for benefits at 62 years. Your monthly benefit on your own record would be approximately $375. Your monthly spousal benefit would be approximately $349. Your total benefit would be approximately $724.
© 2014 Social Security Timing®. All Rights Reserved.
14
3/19/2014
Husband Dies at 70 - Suggested
© 2014 Social Security Timing®. All Rights Reserved.
Husband Dies at 70 - Suggested
© 2014 Social Security Timing®. All Rights Reserved.
15
3/19/2014
Break-Even
© 2014 Social Security Timing®. All Rights Reserved.
Summary – Mistake #1 • It rarely makes sense for the Higher wage earner to file for early benefits. • If anyone needs to file early it should be the lower wage earner • The Spousal Benefit is based on the PIA, not the benefit of the person under whose record you are claiming.
© 2014 Social Security Timing®. All Rights Reserved.
16
3/19/2014
Common Claiming Mistakes
Higher earner files early
Both elect after FRA
Improper coordination of benefits
© 2014 Social Security Timing®. All Rights Reserved.
Both File at 70 Total Benefit: $891,900 Jeff •
File a standard application for benefits at age 70 years. Your approximate benefit on your own earnings record would be $2,639
Lorraine •
File a standard application for benefits at age 70 years. Your approximate monthly benefit would be $999. This represents a benefit of $660 on your earnings record plus an additional spousal benefit of $339.
© 2014 Social Security Timing®. All Rights Reserved.
17
3/19/2014
Comparing Strategies Total Benefit: $891,900 Jeff • File a standard application for benefits at age 70 years. Your approximate benefit on your own earnings record would be $2,639 Lorraine • File a standard application for benefits at age 70 years. Your approximate monthly benefit would be $999. This represents a benefit of $660 on your earnings record plus an additional spousal benefit of $339.
© 2014 Social Security Timing®. All Rights Reserved.
Comparing Strategies Total Benefit: $947,352
(Both at 70 was $891,900 )
Jeff • File a Restricted application for only your spousal benefit based on Lorraine's earnings record at your age 66 years. This allows you to continue to earn delayed retirement credits on your own benefit. Your approximate spousal benefit would be $250 • File for your own benefit at age 70 years. Your approximate benefit on your own earnings record would be $2,639. Lorraine • File a standard application for benefits at age 62 years. Your approximate monthly benefit would be $375. • When Jeff files for his own benefit, you will become entitled to an additional spousal benefit of approximately $499, This should be applied automatically, but if it is not, contact your local Social Security office. © 2014 Social Security Timing®. All Rights Reserved.
18
3/19/2014
Both File at 70
© 2014 Social Security Timing®. All Rights Reserved.
Summary – Mistake #2 • It rarely makes sense for both people to delay until 70. • One person should take a spousal benefit at FRA or as soon as possible thereafter. • If the Retirement benefit with DRCs will still be less than the spousal benefit, do not delay the retirement benefit past FRA.
© 2014 Social Security Timing®. All Rights Reserved.
19
3/19/2014
Common Claiming Mistakes
Higher earner files early
Both elect after FRA
Improper coordination of benefits
© 2014 Social Security Timing®. All Rights Reserved.
Case Study • Jeff is 64 yrs old, Lorraine is 60 yrs old • Jeff is the high wage earner - $2,000 Social Security benefit at 66 • Lorraine is the lower wage earner - $500 Social Security benefit at 66
© 2014 Social Security Timing®. All Rights Reserved.
20
3/19/2014
Early Filing for Retirement and Spousal Jeff PIA $2,000
Lorraine Maximum spousal $1,000 ½ of the PIA
“Deeming” Situation Lorraine PIA $500
Lorraine’s spousal excess $500
x 75%
x 70%
(reduction factor for early filing)
(reduction factor for early filing)
Lorraine’s reduced benefit $375
Lorraine’s reduced excess $350
Lorraine’s total benefit $725
© 2014 Social Security Timing®. All Rights Reserved.
Early Filing for Retirement and Spousal Non “Deeming” Situation Excess applied at FRA
Jeff PIA $2,000
Lorraine Maximum spousal $1,000 ½ of the PIA
Lorraine PIA $500
x 75% (reduction factor for early filing)
Lorraine’s reduced benefit $375
Lorraine’s spousal excess $500
No reduction for Early Filing
Lorraine’s spousal excess $500
Lorraine’s total benefit $875
© 2014 Social Security Timing®. All Rights Reserved.
21
3/19/2014
Late Filing for Retirement, Spousal at FRA Jeff PIA $2,000
Retirement and Spousal at 70 Lorraine PIA $500
x 1.32 (Four years of DRCs)
Lorraine spousal $1,000
Lorraine’s Retirement benefit $660
Lorraine’s spousal excess $340
Total benefit $1000
½ of the PIA © 2014 Social Security Timing®. All Rights Reserved.
Summary – Mistake #3 • Know when “Deeming” applies • Each benefit is “Independently Reduced” based on when that benefit is claimed • A lower earner “adds on” the spousal excess. They do not “switch to” the spousal benefit.
© 2014 Social Security Timing®. All Rights Reserved.
22
3/19/2014
Advisors are Critical! • SSA looks to get the highest Benefit on the day you file – not over the client’s life and definitely not over joint lives • SSA can not give advice. • SSA can not coordinate benefits with outside assets.
© 2014 Social Security Timing®. All Rights Reserved.
© 2014 Social Security Timing®. All Rights Reserved.
23
3/19/2014
Live Roadshows
Atlanta June 26th – Watch your Inbox! © 2014 Social Security Timing®. All Rights Reserved.
APRIL 16TH
DECIPHERING SOCIAL SECURITY FOR THE DIVORCED CLIENT
For advisor use only — not intended for general distribution
24
3/19/2014
Questions?
For advisor use only — not intended for general distribution
For advisor use only — not intended for general distribution
25
The Top 3 Mistakes to Avoid with Spousal and Survivor Benefits
For advisor use only — not intended for general distribution
Agenda • Spousal and Survivor Benefits Primer • Common Claiming Mistakes with Case Studies • Take-Away Materials • Q&A
© 2014 Social Security Timing®. All Rights Reserved.
1
3/19/2014
Common Claiming Mistakes
Higher earner files early
Both elect after FRA
Improper coordination of benefits
© 2014 Social Security Timing®. All Rights Reserved.
Spousal and Survivor benefits primer
For advisor use only — not intended for general distribution
2
3/19/2014
Spousal Benefits John’s primary insurance amount at full retirement age is $2000.
• Maximum Benefits of up to 50% of your spouse’s PIA (Not benefit amount) • To Qualify – Married at least 1 year – Primary worker must have filed – Generally must not qualify for a benefit of your own that is equal to or greater than ½ of the primary workers Primary Insurance Amount (PIA)
Jane would be eligible for ½ at her full retirement age - $1000!
© 2014 Social Security Timing®. All Rights Reserved.
Why “Up To?” • Reduced for early claiming • Reduced by the greater of the Spouse’s Retirement Benefit amount or the PIA
© 2014 Social Security Timing®. All Rights Reserved.
3
3/19/2014
Filing for spousal Early/Late • Reduced on a faster schedule if filing early
• No delayed retirement credits on spousal benefits
RIB
SPOUSAL
62
75
70
63
80
75
64
86 2/3
83 1/3
65
93 1/3
91 2/3
66
100
100
67
108
100
68
116
100
69
124
100
70
132
100
© 2014 Social Security Timing®. All Rights Reserved.
Top-Up Primary Wage Earner PIA - $2,500 $1,400 $1,200 $1,000
$260
$0
$500
$800
$1,250
$600 $400
$990 $750
$200 $0 Age 66
Age 70
Spouse's Retirement Benefit
Age 66
Spousal Benefit
© 2014 Social Security Timing®. All Rights Reserved.
4
3/19/2014
File Before FRA? Deeming Applies • Before FRA – File for own • Reductions apply
– File for spousal (if available) • Even greater reduction for taking spousal early
• You cannot take a spousal only before FRA* • Strategies available
* Unless you don’t qualify for a retirement benefit © 2014 Social Security Timing®. All Rights Reserved.
Survivor’s Benefits • At death of first spouse, surviving spouse receives highest of: – His or her own benefit – Benefit of the deceased – 82.5% of the FRA benefit of the deceased
Once John passes, Jane will receive a higher benefit of $2000*
• The lesser benefit disappears *Assuming John elected at FRA and Jane Claims Widow Benefits at or after her Widow FRA. © 2014 Social Security Timing®. All Rights Reserved.
5
3/19/2014
Survivor’s Benefits Widow benefit is based on when the Deceased filed, and when the Survivor files. 3000 2500 2000 1500 1000 500 0
60
61
62
Deceased at 62
63
64
65
66
Deceased at FRA
67
68
69
70
Deceased at 70
© 2014 Social Security Timing®. All Rights Reserved.
Switch Strategies® • Prior to FRA “Deeming” applies • After FRA, can pick and choose • “Switch Strategy” is filing for a limited benefit and then later “Switching” to a larger benefit
© 2014 Social Security Timing®. All Rights Reserved.
6
3/19/2014
What makes Switch Strategies® possible? Allows an individual to file, then request checks be stopped. During the period in which no checks are received, will earn delayed retirement credits.
Allows an individual to limit an application to only one benefit, which may allow another benefit to receive delayed credits. Each spouse gets both – spousal and solo…
File & Suspend
Switch Strategy Enablers Restricted Application
© 2014 Social Security Timing®. All Rights Reserved.
Married Case Study • John and Jane are both 66 today – John’s benefit is $2400 and Jane’s full retirement age benefit is $1100 per month
What are the possible Switch Strategies?
• Their advisor suggested that John take at 70 and Jane take immediately © 2014 Social Security Timing®. All Rights Reserved.
7
3/19/2014
Several Switch Possibilities • John Files & Suspends, making the spousal benefit available to Jane • John files a Restricted Application for spousal benefits • John Files & Suspends, Jane files a Restricted Application for spousal only benefits, then switches to her own benefit at 70 If no “Switch Strategy” is employed, this couple is leaving at least $26,400 on the table © 2014 Social Security Timing®. All Rights Reserved.
Watch Out! No cross-claim for married couples, even though you may read about it…
© 2014 Social Security Timing®. All Rights Reserved.
8
3/19/2014
Common Claiming Mistakes
Higher earner files early
Both elect after FRA
Improper coordination of benefits
© 2014 Social Security Timing®. All Rights Reserved.
Case Study • Jeff is 64 yrs old, Lorraine is 60 yrs old • Jeff is the high wage earner - $2,000 Social Security benefit at 66 • Lorraine is the lower wage earner - $500 Social Security benefit at 66 • Life Expectancies – 85 and 90
© 2014 Social Security Timing®. All Rights Reserved.
9
3/19/2014
What’s at Stake?
$191,280
© 2014 Social Security Timing®. All Rights Reserved.
Earliest Strategy Total Benefit: $756,072 Jeff • File a standard application for benefits at age 62 years. Your approximate benefit on your own earnings record would be $1,453 Lorraine • File a standard application for benefits at age 62 years. Your approximate monthly benefit would be $725. This represents a benefit of $375 on your earnings record plus an additional spousal benefit of $350.
© 2014 Social Security Timing®. All Rights Reserved.
10
3/19/2014
Jeff’s PIA - $2,000 75% - $1,500
Lorraine’s PIA - $500 75% - $375
Less real COLA
© 2014 Social Security Timing®. All Rights Reserved.
Suggested Strategy Total Benefit: $947,352 Jeff • File a Restricted application for only your spousal benefit based on Lorraine's earnings record at your age 66 years. This allows you to continue to earn delayed retirement credits on your own benefit. Your approximate spousal benefit would be $250 • File for your own benefit at age 70 years. Your approximate benefit on your own earnings record would be $2,639. Lorraine • File a standard application for benefits at age 62 years. Your approximate monthly benefit would be $375. • When Jeff files for his own benefit, you will become entitled to an additional spousal benefit of approximately $499, This should be applied automatically, but if it is not, contact your local Social Security office. © 2014 Social Security Timing®. All Rights Reserved.
11
3/19/2014
Suggested Strategy
© 2014 Social Security Timing®. All Rights Reserved.
What happens when the Higher Wage Earner dies early?
For advisor use only — not intended for general distribution
12
3/19/2014
Husband Dies at 70 - Earliest Total Benefit: $653,326 Jeff • File a standard application for benefits at age 62 years. Your approximate benefit on your own earnings record would be $1,453 Lorraine •
File a standard application for benefits at age 62 years. Your approximate monthly benefit would be $725. This represents a benefit of $375 on your earnings record plus an additional spousal benefit of $350.
© 2014 Social Security Timing®. All Rights Reserved.
Husband Dies at 70 - Earliest
© 2014 Social Security Timing®. All Rights Reserved.
13
3/19/2014
Husband Dies at 70 - Earliest
© 2014 Social Security Timing®. All Rights Reserved.
Husband Dies at 70 - Suggested Total Benefit: $795,508
(Earliest was $653,326 )
Jeff • File a standard application for benefits at age 66 years • Immediately request that your benefit payments be suspended. This allows you to continue building delayed retirement credits on your record, but makes Lorraine eligible to claim spousal benefits on your earnings record. • When you reach age 70 years, request your benefits be paid. At this point, your approximate benefit would be: $2,639 Lorraine • File a standard application for benefits at 62 years. Your monthly benefit on your own record would be approximately $375. Your monthly spousal benefit would be approximately $349. Your total benefit would be approximately $724.
© 2014 Social Security Timing®. All Rights Reserved.
14
3/19/2014
Husband Dies at 70 - Suggested
© 2014 Social Security Timing®. All Rights Reserved.
Husband Dies at 70 - Suggested
© 2014 Social Security Timing®. All Rights Reserved.
15
3/19/2014
Break-Even
© 2014 Social Security Timing®. All Rights Reserved.
Summary – Mistake #1 • It rarely makes sense for the Higher wage earner to file for early benefits. • If anyone needs to file early it should be the lower wage earner • The Spousal Benefit is based on the PIA, not the benefit of the person under whose record you are claiming.
© 2014 Social Security Timing®. All Rights Reserved.
16
3/19/2014
Common Claiming Mistakes
Higher earner files early
Both elect after FRA
Improper coordination of benefits
© 2014 Social Security Timing®. All Rights Reserved.
Both File at 70 Total Benefit: $891,900 Jeff •
File a standard application for benefits at age 70 years. Your approximate benefit on your own earnings record would be $2,639
Lorraine •
File a standard application for benefits at age 70 years. Your approximate monthly benefit would be $999. This represents a benefit of $660 on your earnings record plus an additional spousal benefit of $339.
© 2014 Social Security Timing®. All Rights Reserved.
17
3/19/2014
Comparing Strategies Total Benefit: $891,900 Jeff • File a standard application for benefits at age 70 years. Your approximate benefit on your own earnings record would be $2,639 Lorraine • File a standard application for benefits at age 70 years. Your approximate monthly benefit would be $999. This represents a benefit of $660 on your earnings record plus an additional spousal benefit of $339.
© 2014 Social Security Timing®. All Rights Reserved.
Comparing Strategies Total Benefit: $947,352
(Both at 70 was $891,900 )
Jeff • File a Restricted application for only your spousal benefit based on Lorraine's earnings record at your age 66 years. This allows you to continue to earn delayed retirement credits on your own benefit. Your approximate spousal benefit would be $250 • File for your own benefit at age 70 years. Your approximate benefit on your own earnings record would be $2,639. Lorraine • File a standard application for benefits at age 62 years. Your approximate monthly benefit would be $375. • When Jeff files for his own benefit, you will become entitled to an additional spousal benefit of approximately $499, This should be applied automatically, but if it is not, contact your local Social Security office. © 2014 Social Security Timing®. All Rights Reserved.
18
3/19/2014
Both File at 70
© 2014 Social Security Timing®. All Rights Reserved.
Summary – Mistake #2 • It rarely makes sense for both people to delay until 70. • One person should take a spousal benefit at FRA or as soon as possible thereafter. • If the Retirement benefit with DRCs will still be less than the spousal benefit, do not delay the retirement benefit past FRA.
© 2014 Social Security Timing®. All Rights Reserved.
19
3/19/2014
Common Claiming Mistakes
Higher earner files early
Both elect after FRA
Improper coordination of benefits
© 2014 Social Security Timing®. All Rights Reserved.
Case Study • Jeff is 64 yrs old, Lorraine is 60 yrs old • Jeff is the high wage earner - $2,000 Social Security benefit at 66 • Lorraine is the lower wage earner - $500 Social Security benefit at 66
© 2014 Social Security Timing®. All Rights Reserved.
20
3/19/2014
Early Filing for Retirement and Spousal Jeff PIA $2,000
Lorraine Maximum spousal $1,000 ½ of the PIA
“Deeming” Situation Lorraine PIA $500
Lorraine’s spousal excess $500
x 75%
x 70%
(reduction factor for early filing)
(reduction factor for early filing)
Lorraine’s reduced benefit $375
Lorraine’s reduced excess $350
Lorraine’s total benefit $725
© 2014 Social Security Timing®. All Rights Reserved.
Early Filing for Retirement and Spousal Non “Deeming” Situation Excess applied at FRA
Jeff PIA $2,000
Lorraine Maximum spousal $1,000 ½ of the PIA
Lorraine PIA $500
x 75% (reduction factor for early filing)
Lorraine’s reduced benefit $375
Lorraine’s spousal excess $500
No reduction for Early Filing
Lorraine’s spousal excess $500
Lorraine’s total benefit $875
© 2014 Social Security Timing®. All Rights Reserved.
21
3/19/2014
Late Filing for Retirement, Spousal at FRA Jeff PIA $2,000
Retirement and Spousal at 70 Lorraine PIA $500
x 1.32 (Four years of DRCs)
Lorraine spousal $1,000
Lorraine’s Retirement benefit $660
Lorraine’s spousal excess $340
Total benefit $1000
½ of the PIA © 2014 Social Security Timing®. All Rights Reserved.
Summary – Mistake #3 • Know when “Deeming” applies • Each benefit is “Independently Reduced” based on when that benefit is claimed • A lower earner “adds on” the spousal excess. They do not “switch to” the spousal benefit.
© 2014 Social Security Timing®. All Rights Reserved.
22
3/19/2014
Advisors are Critical! • SSA looks to get the highest Benefit on the day you file – not over the client’s life and definitely not over joint lives • SSA can not give advice. • SSA can not coordinate benefits with outside assets.
© 2014 Social Security Timing®. All Rights Reserved.
© 2014 Social Security Timing®. All Rights Reserved.
23
3/19/2014
Live Roadshows
Atlanta June 26th – Watch your Inbox! © 2014 Social Security Timing®. All Rights Reserved.
APRIL 16TH
DECIPHERING SOCIAL SECURITY FOR THE DIVORCED CLIENT
For advisor use only — not intended for general distribution
24
3/19/2014
Questions?
For advisor use only — not intended for general distribution
For advisor use only — not intended for general distribution
25
