THE UPSIDE AND THE LOWDOWN ON SOCIAL SECURITY IN 2018
How Current and Future Retirees Will Fare
For some, Social Security is, or will be, the centerpiece of their retirement table. At the very least, it will be a significant financial component for most seniors during their “golden years”. So in this article we’ll take a look at what may be expected in the Social Security playbook for retirees … both current and soon-to-be.
When Retirement is on the Horizon
Let’s start with folks who are anticipating retirement and what they should consider as it relates to Social Security benefits. An important consideration is when you should start claiming your benefits. Of course, your total financial circumstances will impact your decision, but ideally waiting until full retirement age will maximize your benefits over the course of your retirement.
Full retirement age is the age at which you may first become entitled to full or unreduced retirement benefits and will vary based on your year of birth. The earliest age that you may claim benefits is 62. However you will receive a reduced amount for each year that you retire between age 62 and your full retirement age. Click here for the details, but here is a brief rundown on what to expect.
- You’ll receive 6 to 7 percent more for each year by waiting until full retirement age.
- Folks currently between ages 62 and 66 will break-even at roughly age 73 or 74.
- Benefits continue to increase between full retirement age and age 70.
- If you continue to work, you will forfeit one dollar of Social Security benefits for every two dollars you earn over $17,040 annually. Note: Earning $51,120 or more means you forfeit all of your Social Security benefits in that year!
Here’s an excellent planning tool on the Social Security website that will give you many different ways to calculate your benefits.
A word regarding spouses … spousal benefits will kick in for spouses with low or no earnings at 50 percent of your benefit. Again, if possible, waiting to retire at 70 is a real income booster.
For Those Folks Who Have Retired and Receive Social Security
Here’s a rundown on what you can expect in 2018 and perhaps beyond.
- Modest cost of living adjustment will bump benefits by 2%. Net effect will be in the range of $25 in monthly benefits.
- Maximum monthly benefit cap rises to $2,788.
- Disabled folks will receive increases of $10 to $20 per month depending on their disability.
Safeguarding Your Identity and Benefits
It’s pretty well known that your Social Security number and personal information are prime targets for fraudsters. Here are some reminders of where and how to exercise caution to avoid the considerable emotional disruption and potential financial loss when your information has been compromised.
Social Security Number Theft and Safeguarding:
The Identity Theft Resource Center reports almost half of all identity theft now is happening in health care facilities and suppliers of medical equipment and services. Kiplinger offers up an additional eight categories of risky places to lose your Social Security number. Be cautious of providing your Social Security number without absolute assurance it is necessary to do so at that moment in time.
Replacement of Your Medicare Card:
If you haven’t already been contacted, you will receive a new Medicare card. The new card will not include your Social Security number.
Never Share Your Social Security Number on Social Media:
Your initial reaction to this may be “duh”. However, a Visa report reveals that about 7 percent of people have posted their Social Security number on social media.
Summary
OK. The above is by no means a full rendition of all there is to know about Social Security. If you continue in a DIY mode, here’s a slideshow with most of the above, plus an item or two that weren’t covered.
Alternatively, if DIY does not appeal to you or appears risky … Pearson & Co. stands ready to help. Call or email … we’ll respond promptly.