Friday, March 18, 2016

Social Security Earnings based on spouse

Earnings based on Ex-spouse
You may be eligible to receive Social Security retirement benefits based on your ex-spouse's earnings record.  To do that:

1) Your marriage must have lasted at least 10 years
2) You must be currently unmarried
3) You must be at least 62 years old; and
4) The benefit you would have received based on your own earnings must be less than what you would receive based on the earnings of your ex-spouse.

Earnings based on current spouse
Many spouses who choose to stay at home for extended periods spend a lot of time outside the workforce.  This can affect their ability to collect Social Security benefits.  In cases where a spouse earns less, they may be eligible for a spousal benefit from Social Security.  A spousal benefit can be as much as 50% of the higher earning spouse's benefit at full retirement age.  The exact amount depends on whether or not each spouse has reached full retirement age.

Monday, March 14, 2016

What do you really know about Social Security?

What do you really know about Social Security?

Social Security is easy to understand and implement.  Right?  Not so fast.  There are a few things you might want to know since only 1 out of every 1500 people get it completely right.

It matters when you start collecting
If you think you receive the same monthly benefit based on your earnings no matter when you start collecting, think again. If you collect benefits from Social Security before reaching full retirement age, you are electing a lower monthly benefit amount for your lifetime.  If you do wait to begin collecting benefits until after you have reached full retirement age, you will be eligible for delayed retirement credits.  This means your benefits increase by 8% for each year of your delay.  In all, you can add up to 32% more to your total benefits until age 70 when delayed retirement benefits end.

It matters when you were born
Your full retirement age is based on when you were born. If that was between 1943 and 1954, your full retirement age is 66.

Social Security and Medicare are different decisions
Even though both Social Security benefits and Medicare are both initiated through the Social Security Administration, they are two different decisions.  Medicare can be elected separately from Social Security and the qualifications for Medicare are different than for Social Security.

Bottom line, deciding on when to elect Social Security is a part of your financial life planning, but not the whole picture.  The decisions you make now can impact your retirement picture significantly.