- I applied LAST WEEK................I've already received my first check.
Do it on line
Select a local office to process
Take all the information you are asked to provide to the local office.
Stand by!
Thursday, October 2, 2008
Would You Believe?
Saturday, September 27, 2008
Done Deal
I was amazed at how easy it was to apply for Social Security Benefits! The website says to start about three months before you are eligible. It took me all of three days!
I will receive my benefits for the same month in which I applied (September) and get a check every month after that.
I did it all on the Internet and then, when asked, chose my local SS Office to process the application. My thinking was that I could drive to the office and not wait for the mail. If there were any questions, I could answer them on the spot and save bunches of time. I was right!
To apply, check out the SS website at: http://www.ssa.gov/retirement.html
I will receive my benefits for the same month in which I applied (September) and get a check every month after that.
I did it all on the Internet and then, when asked, chose my local SS Office to process the application. My thinking was that I could drive to the office and not wait for the mail. If there were any questions, I could answer them on the spot and save bunches of time. I was right!
To apply, check out the SS website at: http://www.ssa.gov/retirement.html
Wednesday, June 11, 2008
Applying for Social Security
This will be the first of several posts in the application for Social Security retirement benefits. I will reach sixty-two in a few months and will chronicle my efforts from the application to the receipt of the benefits.
The electronic application and other information can be reached at the Social Security web site.
After checking the site, there are several items that need to be in front of you when you fill out the application. I will access those documents and then begin the process. At that time, I will post again.
Until next time.....
The electronic application and other information can be reached at the Social Security web site.
After checking the site, there are several items that need to be in front of you when you fill out the application. I will access those documents and then begin the process. At that time, I will post again.
Until next time.....
Friday, May 16, 2008
I did the math
After reading the previous two posts, I took my calculator and sat down to do the math on applying for SS benefits early. By taking what I will get at 62 against what I will get at 66, I have determined that it would take 13 additional years to break even if I waited until 66.
Can you guess my decision?
Can you guess my decision?
Thursday, May 15, 2008
More contemporary explanation of Social Security
ENTERING & LIVING IN RETIREMENT
Social Security Now--- Or Later?
By KATHY M. KRISTOF, Times Staff Writer
It's a question reminiscent of the old "Let's Make a Deal" television show: Should working seniors take their Social Security benefits now or choose a less certain course that promises higher monthly benefits later?Bob Solomon, a working senior in Los Angeles, has already made his choice. Take the money now, he advises.He has a point. Although retirement-age workers can get their future Social Security benefits boosted substantially through something called "delayed retirement credits," you give up a lot of income today for this future benefit.Congress in 2000 eliminated one of the barriers to collecting early retirement by doing away with the Social Security retirement earnings test for 65-to-69-year-olds. These seniors once lost $1 in Social Security for each $3 they earned over $17,000 annually.But those who choose to delay collecting Social Security after they hit normal retirement age benefit from a substantial boost in the eventual monthly benefits check. So working seniors have to make a choice: some money now or more money later.For each year that today's 65-year-olds delay receiving Social Security, they'll receive a 6% boost in future benefits. In other words, a 65-year-old who delays taking a $1,000 monthly benefit today will collect $1,300 a month by waiting until age 70 to begin receiving benefits.The question, of course, is: Will those higher future benefits make up for the amount you lose in payments in the meantime? The answer depends on how long you live, said J. Robert Treanor, manager of Social Security information services at William M. Mercer Inc., a national benefit consulting firm, and co-author of the "Mercer Guide to Social Security and Medicare" (William M. Mercer, 2000).Given the current delayed retirement credit rates and average life spans, today's retirees are probably better off taking benefits now, he said. They'd have to live much longer than the average American to enjoy an economic benefit from the higher future payments.Each year, this question becomes trickier because delayed retirement credit rates are gradually rising, as are average life spans, Treanor noted. At that point, someone who lives just modestly longer than average might be better off delaying retirement benefits.To illustrate the point, consider a hypothetical example.John Smith turned 65 in January, 2000. His so-called primary insurance amount, meaning his monthly Social Security benefit if he retires at normal retirement age, is $1,000. But Smith has a full-time job he expects to keep for at least five more years. He must decide whether to take the $1,000 monthly now or wait.If he puts off claiming Social Security until he is 70, he'll get 30% more, or $1,300 monthly, Treanor said. (That's the 6-percentage-point annual delayed retirement credit multiplied by the five years Smith delays his retirement, or 30%.)In exchange, he would be giving up the $1,000-a-month benefit available to him at age 65, or $60,000 over the 60 months till he's 70. In simple terms--not accounting for taxes, which would reduce that figure, or investment income, which would increase it--that means that if Smith delays, he would break even 200 months after his 70th birthday, age 86.6. The catch: The average American 65-year-old man can expect to live to be 81.Women live a few years longer on average. The typical 65-year-old woman will live to be 84, but that's still two years shy of her break-even point, based on this example.Generally, if you have a spouse who would be claiming Social Security on your work record, rather than his or her own, the break-even point for you as a couple is even later.Also, if Smith happens to be in a high tax bracket now while he's still working, the value of the current Social Security income would be pared by the tax bite. He may get more after-tax if he delays Social Security until he stops working and drops into a lower tax bracket. If you think this scenario applies to you, it makes sense to crunch all the numbers with your tax advisor because of the complexity of the rules used to determine how much of your Social Security income is taxable.Still another consideration is that if Smith began collecting a Social Security check now and didn't need the money, he could invest it. Depending on his skills as an investor and the whims of the market, this could earn him considerably more--or nothing at all.Another issue: Some retirees may be more concerned about having enough money when they are very old than they are worried about the nearer future. If they have IRAs or other income that can be used to fund an active retirement in their 70s and early 80s, they might prefer to have a larger Social Security payment available after that money runs out. The mathematical advantages of taking the money now will begin to erode in the future, Treanor said. That's because delayed retirement credit rates gradually rise until they reach 8 percentage points annually for those who hit normal retirement age in 2009. (People born in 1943 hit "normal" retirement age at 66, based on Social Security's gradual pushing up of the age requirement. Those born in 1960 and later won't reach normal retirement age for Social Security purposes until age 67.) At that point, the additional future amount you get for delaying retirement versus the current amount you lose become "actuarially equivalent," Treanor said.
Social Security Now--- Or Later?
By KATHY M. KRISTOF, Times Staff Writer
It's a question reminiscent of the old "Let's Make a Deal" television show: Should working seniors take their Social Security benefits now or choose a less certain course that promises higher monthly benefits later?Bob Solomon, a working senior in Los Angeles, has already made his choice. Take the money now, he advises.He has a point. Although retirement-age workers can get their future Social Security benefits boosted substantially through something called "delayed retirement credits," you give up a lot of income today for this future benefit.Congress in 2000 eliminated one of the barriers to collecting early retirement by doing away with the Social Security retirement earnings test for 65-to-69-year-olds. These seniors once lost $1 in Social Security for each $3 they earned over $17,000 annually.But those who choose to delay collecting Social Security after they hit normal retirement age benefit from a substantial boost in the eventual monthly benefits check. So working seniors have to make a choice: some money now or more money later.For each year that today's 65-year-olds delay receiving Social Security, they'll receive a 6% boost in future benefits. In other words, a 65-year-old who delays taking a $1,000 monthly benefit today will collect $1,300 a month by waiting until age 70 to begin receiving benefits.The question, of course, is: Will those higher future benefits make up for the amount you lose in payments in the meantime? The answer depends on how long you live, said J. Robert Treanor, manager of Social Security information services at William M. Mercer Inc., a national benefit consulting firm, and co-author of the "Mercer Guide to Social Security and Medicare" (William M. Mercer, 2000).Given the current delayed retirement credit rates and average life spans, today's retirees are probably better off taking benefits now, he said. They'd have to live much longer than the average American to enjoy an economic benefit from the higher future payments.Each year, this question becomes trickier because delayed retirement credit rates are gradually rising, as are average life spans, Treanor noted. At that point, someone who lives just modestly longer than average might be better off delaying retirement benefits.To illustrate the point, consider a hypothetical example.John Smith turned 65 in January, 2000. His so-called primary insurance amount, meaning his monthly Social Security benefit if he retires at normal retirement age, is $1,000. But Smith has a full-time job he expects to keep for at least five more years. He must decide whether to take the $1,000 monthly now or wait.If he puts off claiming Social Security until he is 70, he'll get 30% more, or $1,300 monthly, Treanor said. (That's the 6-percentage-point annual delayed retirement credit multiplied by the five years Smith delays his retirement, or 30%.)In exchange, he would be giving up the $1,000-a-month benefit available to him at age 65, or $60,000 over the 60 months till he's 70. In simple terms--not accounting for taxes, which would reduce that figure, or investment income, which would increase it--that means that if Smith delays, he would break even 200 months after his 70th birthday, age 86.6. The catch: The average American 65-year-old man can expect to live to be 81.Women live a few years longer on average. The typical 65-year-old woman will live to be 84, but that's still two years shy of her break-even point, based on this example.Generally, if you have a spouse who would be claiming Social Security on your work record, rather than his or her own, the break-even point for you as a couple is even later.Also, if Smith happens to be in a high tax bracket now while he's still working, the value of the current Social Security income would be pared by the tax bite. He may get more after-tax if he delays Social Security until he stops working and drops into a lower tax bracket. If you think this scenario applies to you, it makes sense to crunch all the numbers with your tax advisor because of the complexity of the rules used to determine how much of your Social Security income is taxable.Still another consideration is that if Smith began collecting a Social Security check now and didn't need the money, he could invest it. Depending on his skills as an investor and the whims of the market, this could earn him considerably more--or nothing at all.Another issue: Some retirees may be more concerned about having enough money when they are very old than they are worried about the nearer future. If they have IRAs or other income that can be used to fund an active retirement in their 70s and early 80s, they might prefer to have a larger Social Security payment available after that money runs out. The mathematical advantages of taking the money now will begin to erode in the future, Treanor said. That's because delayed retirement credit rates gradually rise until they reach 8 percentage points annually for those who hit normal retirement age in 2009. (People born in 1943 hit "normal" retirement age at 66, based on Social Security's gradual pushing up of the age requirement. Those born in 1960 and later won't reach normal retirement age for Social Security purposes until age 67.) At that point, the additional future amount you get for delaying retirement versus the current amount you lose become "actuarially equivalent," Treanor said.
Social Security?
Social Security: Now or later?By Jennie L. Phipps • Bankrate.com
You'd think deciding when to collect Social Security would be as easy as choosing lemon or sugar for that glass of iced tea you plan to enjoy as you rock away retirement on your front porch.
Don't kid yourself. You're dealing with the federal government. Figuring out whether to take benefits early or wait for full retirement can make all your hair gray.
Social Security law lets you retire with reduced benefits at age 62. For those born in 1937 or earlier, that lower benefit is 80 percent of the amount available at the full retirement age of 65.
Starting this year, full retirement age will rise for everyone born in 1938 or later. To further ease pressure on the federal pension system, baby boomers born between 1943 and 1954 won't collect full retirement until they turn 66. After that, the age will rise in two-month increments until full retirement reaches 67 for those born in 1960 or later.
Confused? Use the calculator at the bottom of the Social Security Web page to pinpoint the precise month you'll be eligible for full retirement.
Weighing collection oddsOnce you find out exactly when you can get full benefits, you must decide whether it's worth the wait.
If you take benefits at 62, your Social Security income will be permanently reduced. But because you draw benefits longer, you could come out ahead, depending on how long you live.
Actuaries who calculate insurance and annuity premiums believe the government has done an accurate job of assessing average payout. So whether you take the reduced benefit early or wait until full retirement, the odds are you'll get the same amount of money, says Bruce Shobel, an actuary at New York Life Insurance and chair of the Social Insurance Committee of the American Academy of Actuaries.
But as any Vegas regular knows, there are always winners and losers so it's worth it to weigh your chances before betting on when to collect Social Security.
Start by finding out exactly how much Social Security you'll be entitled to by requesting an earnings statement. When it arrives via snail mail in about a month, you'll see a year-by-year breakdown of earnings; estimates of retirement benefits before age 65, at full retirement age and at age 70; the number of earnings credits needed to retire; and the number of credits you have accumulated.
Math time. With your SSA statement in hand, prepare to do some math.
Take the case of Joe Citizen, born in 1940. He's worked hard and is entitled to the maximum monthly Social Security check of $1,382 if he retires now at age 62. But by waiting for full retirement, he'll be eligible for $1,658. Regardless of which he chooses, he'll get annual cost-of-living increases. Since there's no way to predict how much those will be, let's stick with the basic numbers.
Despite full-retirement payments, Joe wouldn't come out ahead of his early Social Security take until he turns 80. And a boomer who loses 25 percent of benefits by claiming Social Security before 66 would have to hit 82 to make collecting full benefits worth it, even with the more severe cut in benefits.
So why wait? Some knowledgeable people say you shouldn't.
In an article for the National Estimator, a publication of the Society of Cost Estimating and Analysis, John Detweiler weighed the early-pension benefits against life expectancy. The retired cost analyst concluded that the probability of doing better by taking Social Security at age 62 is 87 percent for a man and 71 percent for a woman because she lives longer.
But Detweiler, who will retire in 2003, may not follow his own advice. He's still working and there's a severe benefit penalty for people who collect Social Security early and earn wages. In 2002, wage earners younger than the current full retirement age of 65 will lose 50 cents in benefits on every $1 they earn over $11,280. Another SSA calculator will help you determine what you could lose.
Once you reach full retirement age, the loss of benefits is no longer a worry. Congress lifted that earnings limit in 2000. But then you must consider taxes.
The federal government excludes from taxes a portion of Social Security income, but after retirees earn a certain amount (depending on filing status), Social Security is taxed as ordinary income. Everybody's tax situation is different, but actuary Shobel believes that for most people with earned income, taking Social Security later rather than earlier makes more sense.
"Otherwise you take a double hit," he says, "penalized by both Social Security and the IRS."
Other reasons to delayYou also might want to postpone collecting Social Security benefits if:
You want to erase low benefits. Social Security is based on a complex algorithm. Actual earnings are first adjusted for inflation, then calculated on average monthly indexed earnings during the 35 years in which you earned the most. If you have years when you didn't earn anything, zeros will be factored in for those years, lowering your benefits considerably. Delaying benefits and working between age 62 and full retirement can significantly increase the amount you'll be eligible to receive, says Social Security spokeswoman Martha McNish.
You want to improve a spouse's benefits. A spouse can collect benefits on his or her own record or get half of a spouse's benefits. If a spouse hasn't worked much under Social Security, it may be advantageous for the spouse with the better record to wait until full retirement age. This will provide additional income for the lower or non-earning spouse right away. And upon the death of the spouse with the higher earnings, the survivor can claim the deceased's full benefit. This works for divorced spouses, too, if the couple was married 10 years.
You have a family history of longevity. Did your grandparents live long and healthy lives? If you think you inherited their genetic stamina, consider delaying taking Social Security. Beginning at about age 82, people who wait until full retirement for benefits sprint ahead in total dollars collected. And if you wait until age 70 to start collecting, you'll realize a bonus of 34 percent over what you'd receive at full retirement age. If you don't have a hefty nest egg or another pension plan, this could be a wise move.
Still not ready to wait for full benefits? Then consider the bird-in-the-hand approach.
If you don't need the money before full retirement age, take your benefits early anyway and invest them. A monthly deposit of Joe Citizen's $1,382 check for four years at a modest 5-percent interest rate compounded monthly would yield a savings balance of $73,267. That's a nice chunk of change for anyone's golden years.
Jennie L. Phipps is a contributing editor based in Michigan.
-- Updated: April 18, 2003
You'd think deciding when to collect Social Security would be as easy as choosing lemon or sugar for that glass of iced tea you plan to enjoy as you rock away retirement on your front porch.
Don't kid yourself. You're dealing with the federal government. Figuring out whether to take benefits early or wait for full retirement can make all your hair gray.
Social Security law lets you retire with reduced benefits at age 62. For those born in 1937 or earlier, that lower benefit is 80 percent of the amount available at the full retirement age of 65.
Starting this year, full retirement age will rise for everyone born in 1938 or later. To further ease pressure on the federal pension system, baby boomers born between 1943 and 1954 won't collect full retirement until they turn 66. After that, the age will rise in two-month increments until full retirement reaches 67 for those born in 1960 or later.
Confused? Use the calculator at the bottom of the Social Security Web page to pinpoint the precise month you'll be eligible for full retirement.
Weighing collection oddsOnce you find out exactly when you can get full benefits, you must decide whether it's worth the wait.
If you take benefits at 62, your Social Security income will be permanently reduced. But because you draw benefits longer, you could come out ahead, depending on how long you live.
Actuaries who calculate insurance and annuity premiums believe the government has done an accurate job of assessing average payout. So whether you take the reduced benefit early or wait until full retirement, the odds are you'll get the same amount of money, says Bruce Shobel, an actuary at New York Life Insurance and chair of the Social Insurance Committee of the American Academy of Actuaries.
But as any Vegas regular knows, there are always winners and losers so it's worth it to weigh your chances before betting on when to collect Social Security.
Start by finding out exactly how much Social Security you'll be entitled to by requesting an earnings statement. When it arrives via snail mail in about a month, you'll see a year-by-year breakdown of earnings; estimates of retirement benefits before age 65, at full retirement age and at age 70; the number of earnings credits needed to retire; and the number of credits you have accumulated.
Math time. With your SSA statement in hand, prepare to do some math.
Take the case of Joe Citizen, born in 1940. He's worked hard and is entitled to the maximum monthly Social Security check of $1,382 if he retires now at age 62. But by waiting for full retirement, he'll be eligible for $1,658. Regardless of which he chooses, he'll get annual cost-of-living increases. Since there's no way to predict how much those will be, let's stick with the basic numbers.
Despite full-retirement payments, Joe wouldn't come out ahead of his early Social Security take until he turns 80. And a boomer who loses 25 percent of benefits by claiming Social Security before 66 would have to hit 82 to make collecting full benefits worth it, even with the more severe cut in benefits.
So why wait? Some knowledgeable people say you shouldn't.
In an article for the National Estimator, a publication of the Society of Cost Estimating and Analysis, John Detweiler weighed the early-pension benefits against life expectancy. The retired cost analyst concluded that the probability of doing better by taking Social Security at age 62 is 87 percent for a man and 71 percent for a woman because she lives longer.
But Detweiler, who will retire in 2003, may not follow his own advice. He's still working and there's a severe benefit penalty for people who collect Social Security early and earn wages. In 2002, wage earners younger than the current full retirement age of 65 will lose 50 cents in benefits on every $1 they earn over $11,280. Another SSA calculator will help you determine what you could lose.
Once you reach full retirement age, the loss of benefits is no longer a worry. Congress lifted that earnings limit in 2000. But then you must consider taxes.
The federal government excludes from taxes a portion of Social Security income, but after retirees earn a certain amount (depending on filing status), Social Security is taxed as ordinary income. Everybody's tax situation is different, but actuary Shobel believes that for most people with earned income, taking Social Security later rather than earlier makes more sense.
"Otherwise you take a double hit," he says, "penalized by both Social Security and the IRS."
Other reasons to delayYou also might want to postpone collecting Social Security benefits if:
You want to erase low benefits. Social Security is based on a complex algorithm. Actual earnings are first adjusted for inflation, then calculated on average monthly indexed earnings during the 35 years in which you earned the most. If you have years when you didn't earn anything, zeros will be factored in for those years, lowering your benefits considerably. Delaying benefits and working between age 62 and full retirement can significantly increase the amount you'll be eligible to receive, says Social Security spokeswoman Martha McNish.
You want to improve a spouse's benefits. A spouse can collect benefits on his or her own record or get half of a spouse's benefits. If a spouse hasn't worked much under Social Security, it may be advantageous for the spouse with the better record to wait until full retirement age. This will provide additional income for the lower or non-earning spouse right away. And upon the death of the spouse with the higher earnings, the survivor can claim the deceased's full benefit. This works for divorced spouses, too, if the couple was married 10 years.
You have a family history of longevity. Did your grandparents live long and healthy lives? If you think you inherited their genetic stamina, consider delaying taking Social Security. Beginning at about age 82, people who wait until full retirement for benefits sprint ahead in total dollars collected. And if you wait until age 70 to start collecting, you'll realize a bonus of 34 percent over what you'd receive at full retirement age. If you don't have a hefty nest egg or another pension plan, this could be a wise move.
Still not ready to wait for full benefits? Then consider the bird-in-the-hand approach.
If you don't need the money before full retirement age, take your benefits early anyway and invest them. A monthly deposit of Joe Citizen's $1,382 check for four years at a modest 5-percent interest rate compounded monthly would yield a savings balance of $73,267. That's a nice chunk of change for anyone's golden years.
Jennie L. Phipps is a contributing editor based in Michigan.
-- Updated: April 18, 2003
Beginning Boomer Retirement 101
There are approximately 80 Million people born in the years from 1946 to 1964. They are commonly referred to as Baby Boomers. I am one!
This blog will offer online help, in conjunction with other sites and blogs, in the form of pertinent articles, help sites and information toward bolstering the Boomer Income.
My research over the past 13 months has shown that retiring with a greater income than in any of the working years is definitely possible on the Internet.
My retirement site is: www.my-retirement-project.com. By accessing that site, you will be introduced to some of the Internet possibilities that I have discovered. Additionally, you will be directed toward another of my blogs which runs in parallel to that site.
I have about three months left before I am eligible for the abbreviated version of Social Security.
This blog will also address the pros and cons concerning applying for the benefits now as opposed to more than four years from now.
Today is the first day of the rest of your life and whether you think you can or you think you can't, you're right!
This blog will offer online help, in conjunction with other sites and blogs, in the form of pertinent articles, help sites and information toward bolstering the Boomer Income.
My research over the past 13 months has shown that retiring with a greater income than in any of the working years is definitely possible on the Internet.
My retirement site is: www.my-retirement-project.com. By accessing that site, you will be introduced to some of the Internet possibilities that I have discovered. Additionally, you will be directed toward another of my blogs which runs in parallel to that site.
I have about three months left before I am eligible for the abbreviated version of Social Security.
This blog will also address the pros and cons concerning applying for the benefits now as opposed to more than four years from now.
Today is the first day of the rest of your life and whether you think you can or you think you can't, you're right!
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