How to Get Good Help Claiming Social Security – When and How Claiming You Can Make the Difference Between a Decent Retirement and a Terrible Retirement



Choosing at what age to start receiving Social Security retirement benefits and what type of benefits to claim shouldn’t be difficult. But boy, that’s it!

“There are 2,728 in the Social Security textbook,” Laurence Kotlikoff, a Boston University economics professor and Social Security maven, told me in my new podcast episode “Friends Talk Money. “. “And then there are literally hundreds of thousands of rules about these 2,728 rules. I think it is the most complicated system that humanity has ever developed.

That’s why I’m not too surprised by these findings from a recent national insurance survey: only 6% of the American public said they were aware of all the factors that determine the maximum Social Security benefits a no one can receive and only 39% know their age. d be eligible to receive what is known as full retirement age benefits. (These days, that age is between 66 and 67, depending on your date of birth.)

Another Social Security survey, carried out by global investment manager Schroders, found that 70% of American workers said they wanted to be better informed about Social Security.

Confusion and errors in applying for social security

And a 2019 study by two USC researchers concluded that “most individuals face significant uncertainty about the amount of Social Security retirement benefits they will receive after retirement and that they have. tendency to overestimate these amounts “.

Kotlikoff believes that at least half, if not 70%, of people claiming social security benefits “make major mistakes.”

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Fortunately, there are now a variety of ways to get help making informed Social Security claim decisions – from websites, apps, and software to Social Security specialists you can hire. My “Friends Talk Money” co-hosts Terry Savage, Pam Krueger and I shared information about them in our new episode; the highlights of it are below.

“The name of the game is not to leave money on the table,” said Krueger, host of public television MoneyTrack and founder of the Wealthramp service which reviews financial advisers.

This focus is especially true for married couples and divorced people, who often have the most complex claim decisions.

Basic calculations on social security benefits

First of all, however, it helps to understand the basic math about Social Security benefits.

You are usually allowed to start claiming them at age 62. But your benefit amount will be reduced for each year you claim before your full retirement age. And for each year that you are late between your full retirement age and age 70, your Social Security benefits increase by 8%.

“Don’t take Social Security benefits early,” if you can avoid it, urged Savage, so you don’t see your benefits cut.

But things are never easy when it comes to social security.

The amount of your benefits also depends, among other things, on the amount you have earned each year; how many years you have worked; if you are single, married, divorced or widowed and, if you are married, your spouse’s employment history and the date of the social security application.

Kotlikoff says there are 11 different social security benefits. This complexity is the reason why it is beneficial to get help in making decisions about Social Security claims.

Additionally, you may need to factor in the Social Security penalty for earning employment income while receiving benefits before your full retirement age. This is called the earnings test.

How the Social Security income test can confuse you

“If you buy Social Security early, Social Security withholds $ 1 from your benefits for every $ 2 earned of $ 18,960 this year,” Savage explained. “If you wait until the year you reach full retirement age and are still working, the test is a little more generous. You lose $ 1 in benefits for every $ 3 in earnings over $ 50,520. “

The first place to start for requesting information is the Social Security website. There you will want to create a free “my social security” account to see your Social Security income history and an estimated projection of your benefits.

But the Social Security Administration site has one big limitation for married couples: you can’t see Social Security benefit numbers for both of you together.

You can also get claims information from Social Security staff over the phone (through your local office or the national toll-free number 800-772-1213). Social Security field offices remain largely closed due to COVID-19 restrictions.

But Kotlikoff urges caution about the information you receive from Social Security employees.

“In my experience, [Social Security staffers] give the wrong answer or misleading answers half the time, ”he said. “These people are underpaid, they are well intentioned, but they are overworked and under-trained.”

Turn to calculators, apps and advisors

You can get rough figures for your Social Security benefits at different ages by using free online calculators (from places like financial services companies, the Federal Bureau for Consumer Financial Protection, and AARP) or by paying for social security claim strategy software. Kotlikoff’s Maximize My Social Security, for example, costs $ 40 per year; Social Security Solutions’ SSAnalyzer software costs $ 300 per year.

Related: How to be both an early and a late social security claimant

If you have a financial advisor, this professional may be able to help you. But don’t count on it.

The Nationwide Insurance survey found that about half of people who work with financial advisers said that person did not provide them with advice on how and when to apply for Social Security benefits.

“I think the general population of counselors knows the minimum they need to help their clients” make decisions about social security, “Krueger said. “And then it goes right over their heads … Frankly, I think if you’re planning for retirement and your advisor isn’t able to help you get into ‘what if’ scenario modeling? [about Social Security], I would find another advisor.

To select one, you may want to look for a financial professional who has taken special courses and certification in Social Security. Three national groups now offer such training.

More than 200 counselors have passed the National Association of Registered Social Security Analysts, or NARSSA, exams, and nearly 2,300 have registered for its courses.

“What is most important to me is being able to help others in my age group to do [Social Security claiming] decision, because I’ve seen the huge difference it makes financially, NARSSA co-founder Martha Shedden, in her 60s, told Friends Talk Money.

Shedden said NARSSA advisers typically charge between $ 400 and $ 600 for their advice, based on Kotlikoff’s software calculations.

The National Social Security Association (NSSA) – not affiliated with the Social Security Administration – also has a certificate program for counselors. Some 2,500 people have his certificates, said NSSA co-founder Marc Kiner.

Although Social Security rules are complicated, Kiner said learning them is like learning a foreign language. “Yes, it takes time to learn a foreign language, but if you work with it, you will learn,” he said.

NSSA advisers decide how much they’ll charge clients, but Kiner said his fee is $ 545.

The third group is the Corporation for Social Security Claiming Strategies or CSSCS. It also has a certification.

When it comes to claiming, “context matters”

Before hiring a counselor to help you claim Social Security, Kiner said, ask lots of questions. “What is their pricing structure? If they don’t charge you anything, they want your assets, ”he noted. If they charge a substantial fee, they are more likely to be independent and objective.

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One final tip, from Krueger: Look at your decision to claim Social Security benefits holistically – as part of your overall financial picture.

“There are certain investment strategies for people who adapt very well to your specific situation to qualify for benefits,” Krueger said. “Context matters. “

With an average Social Security benefit of just over $ 1,500 a month, making the right choice about when and how to claim Social Security, Kotlikoff said, “can make the difference between a decent retirement and a terrible retirement “.

Richard Eisenberg is the senior web editor for Next Avenue’s Money & Security and Work & Purpose channels and the site’s editor. He is the author of “How to Avoid a Mid-Life Financial Crisis” and has served as the personal finance editor at Money, Yahoo, Good Housekeeping, and CBS Moneywatch.

This article is reproduced with permission from, © 2021 Twin Cities Public Television, Inc. All rights reserved.

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