As we’ve discussed over the past 18 months, The Bipartisan Budget Act of 2015 really threw a wrench in spousal claiming options. The file and suspend option was eliminated on April 29th, 2016 and the Restricted Claiming Provision wass eliminated for those individuals born after 1953.
So what does that mean for individuals and couples who are planning for retirement? What are their options about when and how to claim their Social Security benefits?
In November of 2015, Congress and the President - through the Bipartisan Budget Act - changed two spousal claiming options regarding Social Security. The first change was the elimination of the “File and Suspend” provision, which allows one spouse to file for benefits at age 66 and then immediately suspend those benefits and wait until age 70 to claim them (thus earning an 8% delayed credit for each year between 66–70).
Topics: Strategic Planning
Many people are unaware of the Social Security issues that relate to current spouses, ex-spouses and deceased spouses. There are 2,728 Core Rules and thousands of additional codicils related to claiming Social Security benefits. Today I will just highlight the basics.
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Topics: Bank Customer Tips
My objective in last month’s column was not meant to confuse you, but to enlighten you as to the how Social Security works and to give you a flavor of the complexity of the claiming decision. Let’s face it: you have paid thousands of dollars in FICA taxes over your working careers, for both yourselves and your employees. Doesn’t it make sense to get a better understanding of how it works, and when and how to claim in order to capture maximum benefits? The claiming decision should be based upon Carpenter Rules: measure twice (or thrice), cut once.
When and how to claim Social Security benefits is probably the biggest financial decision most Americans will ever make. For the average retiree, it accounts for about 40% of their retirement income. This means that it is extremely important to claim correctly with a long term perspective, and to integrate Social Security benefits with all your other assets.
Topics: Bank Customer Tips
The decision to claim Social Security is probably the biggest financial decision most Americans will ever make. The difference between making the right decision and making the wrong one can easily surpass $500,000 over a joint lifetime. This is an irrevocable decision, thus it is incumbent upon all involved to truly understand the consequences— both short term and long term— before making their choice.
Topics: Bank Customer Tips
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