Feb 20, 2012|
Kurt Czarnowski from Czarnowski Consulting gives us the latest news from Social Security.
Transcript - Not for consumer use. Robot overlords only. Will not be accurate.
And. Most of us as American workers are no longer participating in company pension plans to my series company. Pension plans I'm referring to. In any go to work for company for 2030 years and then when you retire they start sending -- -- pension check. Well now the way pension plans worked in his. You go to work for accompanying you have a 41 K plan or simple plan -- for a three -- your TSA but that's really the extent. -- your retirement plain view as the individual are responsible for creating your own retirement plan. You do get a Social Security check you can collector Social Security easy early as age 62 and from what I can see most people are counting on their Social Security. For about 3035%. Of their living income in retirement in their retirement yours. So we're gonna spend some time talking about Social Security today will be joined by Kurt -- are now ski firms are now ski consulting. And I think we'll do something a little bit unusual because of the holiday -- stock market opened. Why don't we let folks call into the program with their questions about Social Security or as always there welcome detects the show. Can't give us a call if you've got questions on Social Security today. 877469. 43. To when he too. Or text us at 68680. And a level you said Barry whoever is working for a company for twenty or thirty years now that might be something of the past still -- right. Right thirty years that one company that -- I hope it happens it doesn't happen very often more people change jobs I think it's about every five or six years on the average that you stay with an employer now. Our our next guest is our first guest is Kurds are now ski he's firms are now ski consulting. Used to work at the department of Social Security has great expertise and knowledge on this topic. Kurt welcome to the show Daria -- Well happy president stating you. How long did you have to have been married in order to collect Social Security benefits based on your spouse's. Record in other words. You're you're in a long term marriage how long you have to been married it and then it when you reach retirement age you -- collect their benefits. Now you talk about divorced spouse does or just regular spouses and. But let's start off with -- divorced in general go lied to I'm married. Yup applicant with divorce spouse's benefit from the current program. If you been married for at least ten years prior to the divorce. And view as an act. -- are currently unmarried. And over the ages sixty to then you can collect based on the work in earnings you're back EF the acts. If at least -- 62 was well or is collecting Social Security benefits into think. With that -- interracial marriage requirement yup a couple of other conditions. People understand -- -- -- marriage were still intact so that that divorced spouses going to be able to collect up to it deeper said that the act is about. For his or her own whichever -- higher but not -- What are the what if your spouse has been in married in all on a number a number of -- what is the you know you're married to him for ten years and then somebody else was married to for another ten years. -- and each one of those taxes. Is potentially eligible for collective -- spouse's benefits as long as the marriage lasted at least. Ten years but the thing that people need to understand is under the program. All of those divorced spouse benefits are independent of one another. They do not and that you know new -- for example becomes eligible. That does not reduce the payment to the primary worker nor does -- reduce or impact in any way the benefits paid to any other -- collecting on the record as well but totally independent. That long though that marriage lasted at least ten years -- to collect is an act you'll cannot be married former falcons have remarried as you pointed out but. Unmarried -- left at least ten years. Potential the collect up to 50%. Of the -- amount done or your own whichever one is higher but not both. What what about the the couple they gets married late in life and you know you have. One wage earner who paid a lot of money into Social Security the Mary did. You know at age 58. And the other has not had much of it in the way of payment how long do you have to have been made -- married in order to collect on your spouse -- Social Security benefit. Sort that would -- questioned -- a lot of confusion people hear about that in your duration of marriage requirement for divorce spouse's benefit and I think that they. Same thing holds true for parents spouses and that's incorrect basically what you've been married for a year. You become eligible on your current spouse's account. One year one year duration America absolutely. And it's possible if you're collecting. Just about book collecting and then you married. Then you could potentially become eligible immediately if you both. Collecting benefits at that time you would even have to wait that one year but normally one year duration America requirement. But in cases of divorced -- benefits that with a ten year duration of the. And -- what is your a widow pane view you what are you allowed to collect if you're left with minor children let's say year. Your spouse dies in their early forties and you've got children that are you know 1012. And eight years old. How much hey Gary are you would -- your Social Security benefit in his situation like that. Terms the really important point -- that I think and we had this discussion before many folks all of that the trap about think about Social Security -- that the program for old folks. And it's really much more than that at this comprehensive social insurance program provides protection for workers and their families. Against disability which we touched on in the past. But it also provides protection for families of workers who have passed away at it at an early age and under the Social Security. Survivor. Program. The -- is there about. 06. And a half million people who collect the Social Security benefits because they. Parents are breadwinner in the family has passed the way -- for windows. Or -- words and yet it's important -- up programs gender neutral. That widow -- -- war. And collect the Social Security survivor payments at any age. If they have. In their care they're taking care of eight trials done. Under the age of sixty now those children will also be eligible for a monthly payments those. Payments to children will continue until the child reaches the age of eighteen. Or nineteen -- -- colorful times in the school yup but the parent is gonna be eligible for an additional payment. Up until that time the youngest child turns sixteen. Oh OK and then they go -- when the youngest child turns sixteen. They no longer get their window benefits is that correct. Well that they no longer get the widow benefit on lap. At that time. The widow is at least age. Six he can -- that want to have a child under the age of sixteen -- -- -- you that you collecting widow or what -- payment at any age. Without that child in care earliest stage you can collect a -- -- where payment is age. Now report to point out. That. The Social Security survivor benefit program is not a need. Based program and other -- Social Security doesn't look at assets of determining whether or not -- but he could -- however. If you're collecting a Social Security payments whether it's a retirement benefit or survivor benefit in your under your full retirement age. You're limited in how much you can offer. And still collect payment each month than. That holds true for retired -- is no different for widows and -- words. And so that in 2012. If you ever in income of 141640. Dollars or more. Social Security is required to hold back one dollar and benefits reached two dollars Specter over that threshold up so in today's work world where you've got. Typically two. Parents working. Actually -- you hold that thought we're gonna come back to that in just a moment. June let's let's let folks call into the -- active like to participate to call you got questions about Social Security. At. 18774694322. With toll free call 877469. 4322 marys are magical text machine working well it's -- 68680. With your questions as well we're talking -- -- are now ski and work the topic today is Social Security we've got a few minutes to take some calls from our listeners. It's 8774694322. Okay. Welcome back into the financial exchange with Barry Armstrong and hope fully yeah we've got some calls coming in now -- some questions. Answering your questions about Social Security. And 18774694322. Texting it's X 8680. They've got Stephanie in Salem on the line Stephanie welcome into the financial exchange. Which your question for -- -- Good morning I'm -- question on is basic and trying to confirm information that was Gibbons made by felt security. And make sure that I'm doing the right thing and not leaving money on the table. I am planning on collecting. And so security benefits at age 66 but based on my late husband. Income not my own income and I plan on continue. Two worked I wanna make sure that I'm not leaving on any. Additional money on the table by collecting his benefit that age 66. Go ahead -- -- Stephanie I'm great is a couple of factors that they about and you probably obviously been thinking about them. What's -- read that -- retirement age in your case 66. Under the Social Security program you can work and earn as much you want without any reduction in benefits whatsoever so. At your full retirement age -- 66 you can certainly continue to work. Without any reduction payments and then. App full retirement ages 66 you have the ability to collect only a spot that ex spouse's benefits. Not file the Euro payment yet and earned delayed retirement credits or 8%. Per year increase on your benefit going forward so. Certainly sounds to me like you've gotten good information. That at your full retirement age you can file for. Benefits on your. Former about collect that payments not have a reduced because of your work in earnings and by not filing for your own benefit yet. -- that 8% increase going forward at whatever point makes the most sense for you. File on your own account the important thing is those delayed retirement credits stop accruing at age seventy. From 66 to seventy gonna get any -- an increase. By having not taken your own benefit. I want to -- compliment Stephanie to occur because so many people collect their benefits early. And then when they reach age 7578. They regret the fact that they collected early with Stephanie is doing its very Smart. If she's going to make sure she's continuing to work which I applaud but also at age seventy it's quite conceivable that her benefit might be. Bigger and a more a larger monthly benefit than her -- deceased spouse's benefit. That she can collect at age 66 good good planning on Stephanie -- up. Fully in the and a good thing is she's -- out because. Of that ability to collect the spouse's benefit only after -- retirement age is able to get from -- Social Security income right now to help or help her out but. As you point out that allows her own benefit. To grow at 8% per year which is just -- important because people -- living somewhat longer. Depth when he later in life. Okay Ted in Burlington your next on the financial exchange. Yes -- good morning thank you for taking my call. I have a question just a general question possibly develop -- Tom I'm going to be 62. In the December. And I'm. Quite possibly do to help for reasons -- looking to about collected at that time. I've had tortillas in the insurance industry where they've taken out actually 25. And then I also I'm also going to receiving the small pension I have fifteen years in with the state. Well I'd be. Let -- he'd he'd hit different. Rumors that in my OK with that how does that work. And that the that the -- comes up frequently. That was. -- tension here in the oil and means that you're all of them we all elimination provision in the social security act which basically. 81 and foremost because you have at least ten years and I'm under the Social Security system. Well absolutely positively get something every month from Social Security for reform that will be jeopardized because I even not put audiences in the private industry up and get to that that's gonna get -- with -- -- says he has. If you need that public pensions Social Security. Need to use a different and admittedly less generous formula that calculates human Social Security. -- board you have the under the Social Security program. The goal of an impact. That public attention on the calculation of Social Security payment and it worked out that if you have. Birdie years or more under the Social Security program. And that public pensions in be -- material in the -- Social Security. Start out with -- would get something and if in fact you have. Thirty more years of time under Social Security that public pension won't reduce your Social Security what's. So it sounds like he's gonna get a small reduction because I think he mentioned that he had about 20/20 five years in their -- and it didn't and a -- 30 am I right. And next texture is saying is it better to take it that 66. Or to take it at age 71. Good question Barry you want you to do it well like I've been a big proponent of delaying the collection of your Social Security to age seventy. But you know I get a kick out of occur because invariably whenever you and -- doing public speaking -- grange aren't. People ask us this question and I always tell them they shouldn't ask Kurtz are now -- they shouldn't ask Barry Armstrong they should asks ask their position. Because it's really it's a long jeopardy issue if you die young then you should collect your Social Security at age 66. If you live to a ripe old ages I'm planning to do then you should wait -- late seventy to collect at MI oversimplifying the issue. On a quick thought and that's the big unknown and all of this but obviously that you do when you're gonna pass the way. It all falls into place very easily but I don't think any of us know that and so you're basically. Making your best guess and I think the important issue in -- there's a number of issues to think about we talk about a moment for all of time your help. Longevity you need the money all kinds of issues come into play you have other sources of income that can tide you over. But again I think. The longer you can delay. Given the fact that life expectancy is increasing. But better you going to be in the long. You and I agree on that that's for -- and once again if you get questions about Social Security today were taken and you call. Collison the studio at 877469. 43 to when he to Juli your next week your question on the financial exchange. Hi good morning. I have a question if someone who is able to increase the politically difficult at this he had. But and I think he cash helped -- relative. You know really gross seasoning in the personal treat these section eight subsidy for their part it. -- and then there are two types of disability programs that the Social Security Administration run. -- that the CI which you reference Social Security disability insurance. Is the program for folks who have worked and paid into the Social Security system while they were working. That. Is not -- means tested program. The only thing that impact somebody's at that BI payment is that they happen to collect workers' compensation so collecting SS DI for sure. Receipt of help with groceries and things like that isn't going to impact. Social Security disability insurance the other program that Social Security run is kept outside the supplemental security income. At the site years they need space program. And if someone is collecting FF I as opposed that the -- that the receipt of any other type of income and the impact. The monthly payment that they get so important that the F says DI payment Social Security disability insurance. -- financial assistance from a relative or some or from other sources is not going to impact the amount of their monthly payment. Okay and next -- says I'm 32 years old I'd get updates from Social Security they say. But my retirement age by the time I retire that is the Social Security money will not be there. I think this is a question you know I've always received Kirk during the last twenty years. Is -- they're gonna be any money left in Social Security by the time I reach. My full retirement age maybe you could give us a status update on the Social Security accounts and just how underfunded they are. Or you know it's important for folks there recognized that Social Security try to do. Or does report in new leads the American public on the financial health -- the system that Social Security trustees' report comes out the spring of each year. Report from may of 2011. Says that Social Security is projected to have enough money to pay a 100% of promised benefits. Through the year 2036. And an important point barrier and I've talked about this and other times in the past that report also goes on that they would a lot of people tend to conveniently forget. From that point forward it's not like Social Security's gonna have no money whatsoever the projection is Social Security will have enough money to pay. 77%. Of promised benefits going forward that's important particularly for younger. Folks. Understand Social Security primary source of -- you might get tax dollars collected from workers. Employers that people yourself what so absolute complete and total collapse of the United States economy where nobody is working. Social Security will always have a revenue stream of some sort. It's inconceivable. That while leash on that in the princess bride. That Social Security would have nobody. Whatsoever the question is is that revenue stream projected to be enough to pay a 100% of the promised benefits go forward and at this point after the year 2036. It's only projected to be enough to pay about three quarters of promised benefits that's not sufficient -- not adequate but it's an awful lot different than. People believe younger workers particularly believe who think. At some point Social Security will have no money whatsoever there's always gonna be revenues street. It was going to be enough to pay out of out of promised benefits and absent some changes to the program going forward it won't be. All right Andy I think that's the debate issues they're going to have to be changes to the Social Security. Program in the form of either reduced benefits extended retirement age or higher payroll taxes. Maybe what we can do Curtis later in the week I understand you're gonna be back with us on Friday is that correct which it'll do is on Friday when -- with us -- -- talk about. Potential changes to the Social Security system that we will -- -- -- during our lifetime Kurtz are now ski thank you very much for joining us at the very thing. That more coming up on the financial exchange during the course of the week will be back two or more traditional format to moral when the markets open but today the stock market is not opens or able to take a little bit longer look -- At some very important issues.