Ask Larry

I am delaying retirement and want to know what my benefits will be on my 68 birthday which is september. the ssa gov calculator shows no increase until 2024. I thought they increased each month!

Hi. You do earn delayed retirement credits (DRC) for every month that you don't collect Social Security retirement benefits between your full retirement age (FRA) and age 70, but if you claim benefits before age 70 then your benefit rate is initially only credited with any DRCs you accrued through December of the year prior to the year you claim benefits. So, if you elect to start drawing benefits at age 68 in September 2023, your initial benefit rate will only include the DRCs you earned through December 2022. The DRCs earned from January through August of 2023 couldn't then be added to your benefit rate until effective with your benefit payment for January 2024.

Furthermore, Social Security uses an automated process to add the partial year DRCs earned by people who start drawing benefits mid-year, and my understanding is that such automated recomputations are only done every other year. Therefore, if you elect to start your benefits effective with September 2023, it may take until sometime in 2025 before you actually receive the rate increase for the DRCs you earn in 2023. However, once the rate adjustment is finally processed, Social Security will pay you any back pay that you have coming.

Before deciding when to claim your benefits you should strongly consider using our software (https://maximizemysocialsecurity.com/purchase) to fully compare and analyze all of your options so that you can determine your best strategy for maximizing your benefits.

Best, Jerry

I recently finished reading your book :Get What's Yours". I am married, my wife is 58 and I am 50. My wife plans to retire in 5 years at 63 and I plan to retire in 15 years at 65. I make about 50-75% more than my wife. It sounds like our best option to get what's ours for claiming social security is to wait until we are both 70 before we start collecting. Are there any other options you would recommend?

Hi. It sounds like the best filing strategy for you and your wife depends largely on how your primary insurance amounts (PIA) compare. A person's PIA is equal to their Social Security retirement benefit rate if they start drawing their benefits at full retirement age (FRA).

If your wife's PIA is significantly more than 50% of your PIA, then it may well be a good plan for both of you wait until age 70 to start drawing your respective benefits. But, if your wife's PIA is less than 50% of your PIA, then she should probably start drawing her benefits no later than when she reaches her FRA of 67. She could then file for an additional excess spousal benefit when you start drawing your benefits.

However, the best overall filing strategy for you and your wife depends on numerous different factors, so you may want to strongly consider using our software (https://maximizemysocialsecurity.com/purchase) to fully compare and analyze all of your various options so that you can determine your optimal strategy for maximizing benefits.

Best, Jerry

Hi Larry,

I am a 57 year old widow whose disabled spouse died 7 years ago. We have mentally disabled adult child who receives SSI with survivor benefits. Since my husband's death, I've met someone and I've hesitated on a proposal of marriage mainly because I am a worrier. After losing one spouse to whom I waa with 26 years and knowing I will be responsible for my child for life, I'm concerned if I remarry I will lose my widow's benefit and this new gentleman does not earn nearly as much as my husband did or as much as I do now in my work career. That said, I also wonder if it even matters. When my husband died I made 70K annually and he collected SSI and disability bringing home roughly 40K per year. I now make well over 275K per year and should I die, I believe our daughter would be entitled to survivor benefits based on my income along with other means I've set up for her care. However, I worry. Would it be more beneficial for me to wait until 60 to remarry? Incouldncollecr benefits at that time and leave my fill benefits for age 70. I also worry I may earn too much to collect my former husband's benefit. Lastly, I worry that anything could happen and I may not make this kind of money in two years. I could lose my job or fall ill. I'm in a conundrum as I do not want to miss a good life for a few dollars but I also don't want to lose a benefit that I my need should I find myself unemployed between now and age 60. For the record, I plan to retire at 70.

Hi. I'm sorry for your loss. Here's what I can tell you. Regardless of if and when you remarry, it wouldn't affect your own Social Security retirement benefit rate nor your options with regard to claiming your own benefits. However, if you remarry prior to age 60, then you won't be able to collect widow's benefits on your first husband's Social Security record for as long as your remarriage continues. But, if you remarry at age 60 or later, then it sounds like you may be able to benefit from collecting widow's benefits early while waiting until age 70 to claim your own benefits.

How early that you could potentially collect widow's benefits would depend on how much you'll be earning annually from age 60 to your full retirement age (FRA) of 67. If you'll be earning anywhere close to the amount that you say you're currently earning per year, then you likely couldn't be paid any widow's benefits at least until the year that you reach FRA.

It also sounds like your disabled child may qualify for a higher monthly Social Security benefit rate when you start collecting your benefits, so that could be another factor that you may want to consider. But, if your child is receiving Supplemental Security Income (SSI) benefits, then any increase in her Social Security benefit amount would reduce her SSI payments dollar for dollar.

Our software (https://maximizemysocialsecurity.com/purchase) allows people to compare personalized what-if scenarios so that they can determine their best strategy for claiming benefits. Therefore, you should strongly consider using the software so to compare and analyze all of your various options so that you can determine your best strategy for maximizing your benefits.

Best, Jerry

I retired at 62 and filed for SS. I will turn 66 in June 2023. What is the maximum I can earn in 2023 without affecting my pension?

Hi. If you were born in June 1957 on any day other than June 1st, then you can earn up to $56,520 from January 1 2023 through November 30 2023 without losing any of your Social Security retirement benefits. And, there would then be no limit on how much you could earn after November 30 2023.

Best, Jerry

My wife is 66 1/5 years old and qualifies for ~$1300 per month social security benefits based on previous employment. Not sure how many years she has worked but may be ~20 years. The last 5 years she has worked part time for a California Community College and falls under CALSTRS.

We believe she is vested and based on her ~$25,000 per year income we believe she would receive ~$210 from the non-covered pension.

Based on the WEB rules will her reduction be limited to 1/2 of the $210 pension ($105) or will her Social Security be reduced by $558?

Thank you,

Brian

Hi Brian. If 50% of your wife's monthly CalSTRS pension amount is less than the reduction that would be caused by using the alternate Windfall Elimination Provision (WEP) calculation formula, then your wife's Social Security retirement benefit rate would only be reduced by roughly half of the gross amount of her monthly CalSTRS pension. The WEP guarantee provision limits the amount of reduction caused by WEP to no more than basically half of the gross amount of the non-covered pension.

The actual WEP guarantee calculation is more complex than just dividing the current monthly non-covered pension amount in half, though (https://secure.ssa.gov/apps10/poms.nsf/lnx/0300605370). Our software (https://maximizemysocialsecurity.com/purchase) is fully programmed to handle WEP calculations, so you and your wife should strongly consider using the software to fully compare and analyze all of your various options so that you can determine the best overall strategy for maximizing your benefits.

Best, Jerry

I started collecting social security in October. I was told I would collect for the last 3 months the amount I would have collected in January of 2022. Then it would be adjusted in 2023 for Cola and for the 9 months I waited. I was told I would also get the amount for the three months in 2022 that I got based on January 2022. I am past my full retirement age when I started, but as of February I have the January 2022 amount plus the cola, nothing for waiting the 9 months ( I was told it's 8% yearly)

Hi. You're probably going to need patience. When you start drawing benefits between full retirement age (FRA) and age 70, Social Security initially only gives you credit for any delayed retirement credits (DRC) that you earned through December of the year prior to the year you start collecting. Any DRCs earned in the year that you started drawing benefits are subsequently credited effective with your payment for January of the year after the year you claimed benefits.

However, Social Security uses an automated process to add the the additional DRCs, and my understanding is that such automated recomputations are only done every other year. Therefore, at best you may receive the rate adjustment to add your additional DRCs later this year, but it may not be done until sometime next year. Whenever the rate adjustment is finally processed, though, Social Security will pay you any back pay that you have coming.

Best, Jerry

Thank you for sharing your expertise Larry. My wife and I have a few modest traditional IRAs with aprox $200k combined. We also have a 401K and a rollover IRA from my pension cash-out. Each of these has a little over $1m. I am 68 years old and plan to take my SS at 70. My SS earnings will be near the maximum. My concern is the tax implications of large RMD withdrawals after age 73. My countermeasure is to begin converting the IRA money to ROTH IRAs. I will keep the annual conversions at a modest level to manage the tax hit. My question for you; are there SS advantages/disadvantages with converting any one of our three Ira/401k buckets? I subscribe to your Maximize software and cannot find a way to model this question. Any info will be very much appreciated. Thank you!

Hi. I answer general Social Security questions submitted to this forum, but I don't have access to the data that our software customers submit. Software subscribers are encouraged to submit questions using an online contact form in the help menu so that their questions can be answered by one of our experts with access to their information.

I can tell you that nothing that you do with regard to converting your IRAs or 401Ks will affect your Social Security benefit rate, unless your 401Ks are based on contributions from your earnings that were exempt from Social Security taxes. As long as you always paid Social Security taxes on your wages, your Social Security benefits won't be subject to reduction based on the Windfall Elimination Provision (WEP) (https://www.ssa.gov/pubs/EN-05-10045.pdf).

However, what you decide to do with your IRAs and 401Ks might affect the potential taxation of your Social Security benefits, and your Medicare Part B premium rates. It sounds like you may want to consider subscribing to our Maxifi Planner software, which is a full feature financial software program. For more information about Maxifi, click on the following link: https://maxifiplanner.com/.

Best, Jerry

I am writing on behalf of my former spouse, with respect to any benefits from my social security for which she may eventually qualify. I am an active duty service member, 57 years old,, who will retire in 2025 after 30 years of service and at the age of 60; I have also saved in my TSP and Roth IRA. As such, I intend to take my social security at age 70 My former spouse (currently 54) however, has little in the way of savings. She will have a small teacher pension form Texas, and will get little from social security as she worked in education most of her working years. She is disabled and is living with her parents. She can no longer work as she has been diagnosed with early onset mid -lobe dementia. As we were married for more than ten years, will she be able to qualify for social security based on my social security contributions? Will the fact that I will take my social security at age 70 delay her from getting any benefits based on my account. Very Respectfully, David

Hi David. Delaying your application for benefits until age 70 wouldn't delay your ex-wife's ability to qualify for divorced spousal benefits. Your ex-wife could qualify for divorced spousal benefits as early as when you reach age 62, or if you start receiving Social Security disability (SSDI) prior to age 62. She couldn't qualify for divorced spousal benefits earlier than that even if she's disabled, except in the event of your death. Surviving divorced spousal benefits can be paid as early as age 60, or age 50 if the surviving divorced spouse is disabled.

However, if your ex-wife receives a teachers pension based on her earnings that were exempt from Social Security taxes, then any divorced spousal or survivor benefits for which she'd otherwise be eligible would almost certainly be offset by 2/3rds of the amount of her teachers pension due to the Government Pension Offset (GPO) provision (https://www.ssa.gov/pubs/EN-05-10007.pdf).

If your ex-wife has sufficient Social Security covered earnings to qualify for Social Security disability (SSDI) benefits, it sounds like she may want to apply for those benefits now. There is no minimum age requirement to qualify for SSDI benefits, but there is an insured status requirement. One requirement for insured status for a person who becomes disabled after age 31 is that they must have at least 20 quarters (QC) of Social Security covered earnings within the 40 calendar quarter period immediately leading up to the date they became disabled. In other words, they must have had the equivalent of roughly 5 years of Social Security covered earnings in the 10 year period that ends with the date their disability began.

Best, Jerry

1. If a 26 year old DAC's father passes away, is it required that he apply for the survivor benefit or is it authomatic since he is already receiving SSI. 2. If he does begin receiving survivor benefits, will he be eligible for Medicare right away or will it be a 2 year waiting period.

Hi. If a person is collecting auxiliary (i.e. payable from the record of a living worker) benefits as a disabled adult child (DAC) on the record of a parent and if that parent dies, the DAC's benefits automatically convert to survivor benefits. The only way that the DAC could avoid receiving survivor benefits would be to withdraw their original application for auxiliary DAC benefits, and repay all of the benefits they received.

A conversion from auxiliary to survivor benefits has no effect on a DAC's Medicare eligibility. Medicare entitlement based on DAC eligibility begins with the 25th month of entitlement to DAC benefits, regardless of whether the DAC entitlement is based on the record of a living or deceased parent.

Best, Jerry

Hello Sir,

I'm 78 years old, and last year I purchased a different house to downsize and less stairs. I had to sell some assets from my IRA to procure the house (Approx 150K). In Dec of 2022 I received a notice form SSA stating my benefit was going down over $300 a month because of Selling my IRA assets. I think something was processed wrong with my taxes. Should I be penalized?

Hi. Nothing that you describe in your question would cause your Social Security benefit rate to be reduced. What more likely occurred is that your Medicare Part B premium rate increased due to the increase in your income resulting from the sale of assets from your IRA. If that's the case, you can ask Social Security to reevaluate whether or not your Part B premium rate is correct. But, your premium rate will likely only be reduced if the increase in your income was caused by what Social Security defines as a life changing event (LCE).

Again, though, nothing that you've described in your question sounds like it would be classified by Social Security as an LCE, but you can still ask them to make a new determination by submitting a form SSA-44 (https://www.ssa.gov/forms/ssa-44-ext.pdf). Even if your Part B premium rate does end up being higher this year due to an increase in your income level in a prior year, though, that premium rate increase isn't necessarily permanent. Premium rates are reevaluated every year based on changes in a person's income level.

Best, Jerry