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Why Social Security is more than “signing up”

When I meet a new client, I start by asking some pretty basic questions, every one of which contributes to the development of a personal Social Security strategy:

  • Are you still working?
  • Do you plan on working after you retire?
  • Do you come from a long-lived family?
  • How is your health?
  • Will you still have health insurance?
  • Are you eligible for benefits on someone else’s Social Security “record” (basically, someone else’s account)?
  • Do you have other income to support you if you decide to delay taking your benefits?
  • Will other family members qualify for benefits with you on your record?
  • Are you married, single, or divorced?
  • Do you have children, and if so, how old are they?

Based on your answers, I’ll have even more questions.
Every one of these factors should be taken into account before you elect to begin receiving Social Security benefits.

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What you already know about Social Security.

Social Security is available only to those who pay into the program – about 96% of American workers. While you may think that everyone pays into Social Security, some people do not – employees of some railroads and state employees who participate in state pension programs, etc. Social Security offers participants a predetermined, steady, lifetime income based on the amount of money they have put into the program. To a certain extent, it adjusts for inflation and offers survivor’s benefits. You probably know that the longer you delay receiving your Social Security benefits, the more money you will receive each month.

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Morning Coffee

 

To be eligible for Social Security, you must have “40 credits” of covered work. For most people, this means working for at least 10 years during which they had earnings that were subject to Social Security tax or self-employment tax. You must also be at least 62 years old. In addition, you may qualify for benefits as a spouse, former spouse, or survivor of a covered worker.

What you already know about Social Security

Social Security is available only to those who pay into the program—about 96% of American workers. While you may think that everyone pays into Social Security, some people do not—employees of some railroads and state employees who participate in state pension programs, among others. Social Security offers participants a predetermined, steady, lifetime income based on the amount of money they have put into the program. To a certain extent, it adjusts for inflation and offers survivor’s benefits. You probably know that the longer you delay receiving your Social Security benefits, the more money you will receive each month.

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Why your advisor doesn’t offer this service.

You may have received financial and retirement planning advice from a financial advisor, an insurance agent, or even a “family banker.” None of these individuals are charitable institutions – in many cases, their advice includes recommendations on the purchases of insurance policies, annuities, stocks, etc., for which they receive a commission as do I when I sell these instruments. In my own case, I found that I could not offer the best possible service to my clients without becoming an expert on Social Security, as well. Obviously, no commissions are paid on this portion of my business. It is something I choose to do to provide the best, most complete, retirement planning services I can. Like my colleagues, I am not a charitable institution, either.

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When should you start planning your strategy?

Social Security is an important part of your total retirement/estate planning strategy. I suggest that you should start planning for the part Social s\Security will play in your strategy when you first think “I really ought to put something aside for retirement.” Is twenty too early? Not at all, if you intend to embark on the execution of a disciplined, life-long retirement strategy. Is sixty-two too late? No; but it has been my experience that the options available to you will become fewer as you grow older. The earlier you begin planning, the more choices you will have. In this context, “choices” means “more opportunities to maximize returns.” I find that I can contribute most when people are between the ages of 30 and 50. Though I can and have helped older people make the best choices for them, it remains a fact that the number of choices available to them are fewer. And Social Security is like any other investment: as your circumstances change (income, marital status, children, age, health), you should re-evaluate your plan in light of your new circumstances, just as you would with any other investment.

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At any given moment, across the United States, people are waking up the morning after their sixty-second birthdays, and after their morning coffee they log into the Social Security website to sign-up for their benefits. Sadly, this simple, logical action may be one of the biggest financial mistakes they make, and may cost many of these people hundreds of thousands of dollars over their lifetimes.

Well, it may have something to do with the fact that the official Social Security Handbook contains no less than 2,728 separate rules governing social security benefits. Let’s put it another way. In a recent book on Social Security planning published for financial professionals, over 40 percent of the book is devoted to a discussion of various Social Security strategies for couples! Many more pages are devoted to discussions of strategies that are designed for singles and non-traditional couples.

In an environment where there are 2,728 rules, it shouldn’t surprise you to learn that there are many choices. One you probably already know about: deciding whether to begin collecting Social Security at age 62, and start receiving money then, or to wait perhaps to age 70 and collect more money later. But matters are much more complicated than that. Singles, couples, and “non-traditional” couples (where one spouse may be much younger or older than the other, where there is a great disparity in incomes between the spouses, etc.) all have different issues and one couple’s (or single’s) issues are not at all likely to be like another’s.

My job is to help you devise a Social Security strategy that takes your unique circumstances into account and, in combination with your other resources (savings, investments, pension, etc.), will give you the best possible retirement.

You may have received financial and retirement planning advice from a financial advisor, an insurance agent, or even a “family banker.” None of these individuals are charitable institutions – in many cases, their advice includes recommendations on the purchases of insurance policies, annuities, stocks, etc., for which they receive a commission as do I when I sell these instruments. In my own case, I found that I could not offer the best possible service to my clients without becoming an expert on Social Security, as well. Obviously, no commissions are paid on this portion of my business. It is something I choose to do to provide the best, most complete, retirement planning services I can. Like my colleagues, I am not a charitable institution, either.

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How Anyone Can Maximize Social Security for Retirement

You can claim Social Security millions of ways, but ZERO Social Security Administration employees can advise you and your decision can leave $250,000 of your money with the government. And you don’t get a second chance once you have claimed!

For some reason, many people don’t think of Social Security as part of their financial resources or as something that requires planning. The fact is that if you’re like most people, Social Security will represent 35% percent of your retirement income—or at least it can if you maximize it.

Two common and threatening misconceptions about Social Security
  1. Social Security is simply a matter of signing up for it; there are not many decisions that have to be made.
  2. The Social Security administration is well equipped to help you with the sign-up process.

Both of these notions are utterly incorrect. Making an incorrect decision can leave hundreds of thousands of dollars on the table. And, in fact, the Social Security Administration is not permitted to assist you with making choices.
I took the time to become an expert in Social Security issues so that I could help my clients maximize their Social Security resources as part of their complete retirement portfolios.

Thanks for taking the time to read this material. I hope it will convince you that:
  1. Social Security is not just a matter of signing up; choosing how and when you receive your benefits is a complex task, and it’s an important one.
  2. Performing the task improperly can have severe consequences for you, your spouse, and your children.
  3. I am ready to assist you in choosing appropriate/optimal options for you and your loved ones.

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Why do so many people get it wrong?

Well, it may have something to do with the fact that the official Social Security Handbook contains no less than 2,728 separate rules governing social security benefits. Let’s put it another way. In a recent book on Social Security planning published for financial professionals, over 40 percent of the book is devoted to a discussion of various Social Security strategies for couples! Many more pages are devoted to discussions of strategies that are designed for singles and non-traditional couples.

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Couple in RetirementSocial Security is available only to those who pay into the program—about 96% of American workers. While you may think that everyone pays into Social Security, some people do not—employees of some railroads and state employees who participate in state pension programs, among others. Social Security offers participants a predetermined, steady, lifetime income based on the amount of money they have put into the program. To a certain extent, it adjusts for inflation and offers survivor’s benefits. You probably know that the longer you delay receiving your Social Security benefits, the more money you will receive each month.

Why do so many people get it wrong?

Well, it may have something to do with the fact that the official Social Security Handbook contains no less than 2,728 separate rules governing Social Security benefits. Let’s put it another way. In a recent book on Social Security planning published for financial professionals, over 40 percent of the book is devoted to a discussion of various Social Security strategies for couples! Many more pages are devoted to discussions of strategies that are designed for singles and non-traditional couples.