Secret Ways to Boost Your Social Security

Four legal strategies for adding as much as $12,000 a year to your retirement income.

By Mary Beth Franklin, Senior Editor

From Kiplinger's Personal Finance magazine, July 2008

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Some retirement decisions are irreversible. But many will be happy to learn that choosing when to start collecting Social Security benefits is not.

When John Rothenhoefer, 70, found out that he could increase his Social Security benefits by about $1,000 a month by taking advantage of a do-over strategy, he thought he'd struck gold. As it turns out, he might as well have won a mega lottery. Out of the 32 million retirees who collect Social Security benefits, Rothenhoefer was one of just 71 people this fiscal year to take advantage of an obscure option that lets you halt your current benefits, pay back all you have collected interest-free, and restart your benefits at a new, higher rate based on your current age.

It's perfectly legal, says Mark Lassiter, a spokesman for the Social Security Administration. But don't expect the claims representatives at your local Social Security office or the employees who answer the agency's toll-free number (800-772-1213) to be familiar with the details. "Our service representatives can go an entire career and never encounter this situation," says Lassiter. He recommends that you download Form 521 ("Request for Withdrawal of Application") from the agency's Web site (www.ssa.gov) and visit your local office in person.

This strategy is just one of four little-publicized ways we uncovered to help you maximize your Social Security benefits. Each tactic applies to a specific situation; if one of them is yours, you could be in the money.

A "sweet deal"

For someone like Rothenhoefer, who had been collecting monthly checks for eight years, the price of repaying Social Security benefits can be steep -- $100,000 or more in some cases. But he thinks it's well worth it. Not only will his monthly check be about 75% larger than his previous benefit, but it will also increase with inflation each year for the rest of his life. And if John dies first, his wife, Charlotte, 67, will collect the same monthly amount as a survivor benefit for as long as she lives.

Here's how it works: Let's say you qualify for full benefits of $1,600 a month at your normal retirement age of 66, but you decide to begin collecting your benefits at 62. Your retirement benefits will be reduced by 25% for the rest of your life -- to $1,200 a month, in this example -- because you'll be collecting a smaller benefit for a longer period of time.

On the other hand, if you delay collecting benefits, you will receive an 8% credit for every year beyond your normal retirement age until you reach 70, when your maximum benefit will be 132% of what you would have received at age 66. In this example, you would receive about $2,100 a month at 70 -- a $900 difference.

Maybe you decided to collect benefits early out of fear that you wouldn't live long enough to collect the larger delayed benefit. But now that you've made it to 70, you may regret your decision and wish you were receiving a larger check.

In order to get one, you must first file Form 521 at your local Social Security office to request a withdrawal of your application for benefits. Your retirement benefits will stop almost immediately -- and if your husband or wife receives spousal benefits based on your work record, his or her benefits will stop, too. Then the Social Security Administration will send you a letter telling you how much you need to repay (including any spousal benefits). That process may take several weeks. Once you repay the benefits, you can reapply for new, higher payments based on your current age.

If, for example, you received $1,200 a month starting at age 62, plus annual cost-of-living adjustments through age 70, you would have to repay about $130,000. That's a lot of money, but for some people it's worth the price to get an additional $900 a month in retirement. By comparison, it would cost a 70-year-old man about $190,000 to buy an immediate annuity that would provide $900 a month initially, plus annual inflation adjustments and a 100% survivor benefit. That's 46% more expensive than "buying" a lifetime annuity from Social Security.

Rothenhoefer thinks it's a "sweet deal." He concedes the strategy could backfire if both he and his wife were to die before they recoup their investment, which will take about ten and a half years. Still, he says, "it's worth the gamble," particularly because his wife stands a good chance of living into her nineties, as her mother and grandmother did.

There's another financial downside: You may have to go without Social Security benefits for a few months while the agency sorts out how much you have to repay and you reapply for benefits. When your benefits stop, so do the automatic deductions that cover your Medicare premium. You'll have to pay the Part B premium yourself -- currently $96.40 a month for most retirees -- until your Social Security benefits resume.

Crunch the numbers

Boston University economics professor Laurence Kotlikoff says repaying and reapplying for Social Security benefits is a "fantastic option" for some people. But it can involve a lot of number-crunching to determine whether it's the right decision for you. Kotlikoff offers case studies on his Web site, www.esplanner.com. For $149, you can access his sophisticated financial-planning software, which lets you create your own comprehensive retirement plan, including an analysis of the pros and cons of a decision to pay back your Social Security.

John Greaney, who started the Retire Early Web site (www.retireearlyhomepage.com), says that members of his online community were aware of the repayment strategy but treated it as an urban legend. When Greaney took the time to research it last summer, he realized that it was an even better deal than he had first thought. That's because when you repay your Social Security benefits, you can claim either an itemized deduction or a tax credit (whichever results in bigger savings to you) for the taxes you paid on your benefits in previous years. The calculations are complicated, but you can get all the details in IRS Publication 915, Social Security and Equivalent Railroad Retirement Benefits, at www.irs.gov.

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Reader Comments (172)

Posted by: Tom West at 06/04/2008 02:12:07 AM

I was flabbergasted to read that I apparently can receive a spousal benefit even though I plan on delaying my SS until age 70. I am 66 years old and therefore I have reached full retirement age. My wife, age 67, has been drawing SS since age 62. If I understand Ms. Franklin correctly I can receive a spousal benefit until I begin drawing my benefit at age 70. Could this possibly be true? It strikes me as counterintuitive. But I shall certainly look into this! What do other readers think?

Posted by: Mary Beth Franklin at 06/04/2008 12:50:11 PM

Hi, I'm the author of this Kiplinger article. In answer to Tom West's question, it's absolutely true. Now that you have reached your normal retirement age, you can elect to apply for SPOUSAL benefits only, and delay collecting benefits on your own work record so they will be worth more later. You can not elect to separate your benefits if you apply before your normal retirement age. Warning, though: many Social Security field officers are not familiar with this nuance. If they are unfamiliar with it, insist (politely) on talking to a supervisor.

Posted by: alec at 06/04/2008 03:05:52 PM

In this article, you mention a recent paper by the Center for Retirement Research. What is the title of the paper?

Posted by: Harvey Nadel at 06/04/2008 06:15:17 PM

Numerous people, such as myself, continued to work after 65 (my age to collect SS benefits) but didn't have to lose any SS dollars because they were covered under the SS law for persons 65 or older. There will be an effect on previous income tax returns that SS was taxed on because of the amount of income that was taxed during a specific tax year. If one is to apply for this SS opportunity they should definitely talk to a very skilled tax advisor first.

Posted by: Tom Nuhn at 06/04/2008 09:43:46 PM

(A question about this section in the story) to comment about: "After the death of his first wife several years ago, Bill married a younger woman, and they're expecting their first child this year. When the baby is born, he or she will receive monthly Social Security checks worth up to half of Bill's benefit until the child reaches age 18. How can the child of someone else who hasn't died collect Social Security?

Posted by: Eric Bingman at 06/05/2008 09:32:15 AM

I have read several articles about various ways for retirees to boost their Social Security benefits. I have also read several articles with predictions about how Social Security will eventually go bankrupt. As a diligent worker and taxpayer in my late 20's, I have to wonder how this is going to affect the generations to come. When retirees delay taking Social Security benefits and use these methods to significantly increase the amount they recieve, is it helping or hurting generations to come? I certainly agree that those who have paid into the program should recieve their share of benefits, but when I hear about ways to have "Uncle Sam", also known as "the taxpayers", pay college tuition for the children of retirees, it really concerns me. I am afraid that a program designed to be supplemental income for some will become a cash cow for others. So, my question is do these methods help everyone, or do they help some and hurt others?

Posted by: JO SOUTHWEST at 06/05/2008 01:02:53 PM

I am curious how this could work for me. My husband started drawing SS at 62, he died when he was 68. I started receiving spousal benefits @ 60 (I was 55 when my husband died and did not qualify any monies till age 60). Should I just continue with my very reduced benifits till age 70 and then re-pay and re-apply. I will turn 62 this year (and seem to be healthy) and I am wondering how I could come out the best with SS benifits down the road. Has anyone else been in this position that could give some insight?

Posted by: David Tifft at 06/07/2008 01:22:11 AM

I'm not surprised that only 71 people out of 32 million Social Security recipients in a year took advantage of this unusual provision in the law. If it were really such a great deal, then don't you think it would be much more commonly used, and that the information about it would be passed around by word-of-mouth?

Posted by: Peter Kane at 06/09/2008 10:03:01 AM

I have a problem with the example given for someone like John Rothenhoefer. Using the numbers quoted in the article, a 70-year old recipient would receive a benefit of $2,100 a month after taking advantage of the Social Security do-over strategy. This is compared to an early retirement benefit of $1,200 that he received some 8 years ago at the age of 62, and is cited as a $900 monthly increase. However, this ignores the fact that the initial Social Security benefit of $1,200 would itself have increased to about $1,520 due to annual cost-of-living adjustments over 8 years, which the recipient would now be giving up as part of any Social Security do-over. As such, the gain is not $900 as quoted, but only $580 ($2,100 - $1,520) a month. Instead of paying the government back $130,000 for a do-over, for the same amount a 70-year old man could buy an immediate annuity that would provide $580 a month initially, plus annual inflation adjustment and a 100% survivor benefit. This means that the strategy as outlined would merely result in a washout when compared to an annuity. The fact that the $130,000 payback could be claimed as either an itemized deduction or a tax credit for income tax purposes also does not result in any advantage. If an immediate annuity is paid for with pre-tax savings (such as a Traditional IRA) the $130,000 would not be taxed. Instead, the income from the policy is taxed in the year it is received. If paid for with after-tax savings a portion of each annuity payment will be excluded from taxation until the $130,000 purchase amount has been returned. Accordingly, there also seems to be no tax benefit. I started out reviewing this matter with the full intention of implementing the Social Security do-over strategy, because the numbers for my wife and I are eerily close to the Rothenhoefer example. Unfortunately, upon further scrutiny, the advice appears to be flawed. Am I overlooking something? If so, I would very much appreciate someone straightening me out, since I would not want to lose out on a good thing.

Posted by: Mr Brown at 06/10/2008 08:50:52 AM

Nice if you are in the 1% of people who has the money to pay it back. For the vast majority this is a dream. Thanks anyway.

Posted by: Philip Greenberg at 06/11/2008 01:20:31 PM

If the article is accurate, then almost EVERYONE should collect SS as early as possible. The money should be put into a CD, and not be touched. A decision as to whether to file a do-over can then be made at a later date. In the meantime, the money earns interest that does not need to be repaid. Banks and insurance companies could craft special products to address this situation (contact me for thoughts on how such a product would need to be structured). Tax and other considerations can be built into these products. Free Money!!!

Posted by: Jerry at 06/12/2008 08:14:26 PM

If Peter Kanes figures are correct then the payback plan is inadequate. With a payback of 130,000 to get an additional $580 a month the interest that the 130,000 earns would more than offset this increase. Also if death took place before the additional payments restored the $130,000 the change would leave only a spouse in the same offsetting situation. I don't see this as a good deal at all

Posted by: kal lawrence at 06/13/2008 01:43:00 AM

Peter Kane's comment ignores the vital fact that the $2100 would increase by the same COLA amount as the $1200, and would thus grow to $2660 (using Mr. Kane's COLA assumptions). Thus, by withdrawing the original application and restarting at age 70, the new amount is $1140 per month higher, and continues go grow with inflation.

Posted by: Peter Kane at 06/13/2008 08:15:26 PM

This is in response to kal lawrence�s comment. In the example, the $2,100 would be the current monthly payment a 70 year old would receive from Social Security after the do-over. It incorporates any COLA adjustments to date. This sum would grow with inflation in the future, but so would be the type of immediate annuity that I compared it to.

Posted by: kal lawrence at 06/17/2008 02:39:23 AM

Let me clarify my comment of June 13 in terms of the dialog with Peter Kane. Suppose you are 62 and looking at your SS annual statement, that says: at age 62 you get $1200/month; at age 66 you get $1600/month; at age 70 you get $2100/month. These are the apples-to-apples figures that are being discussed in the article, all three of which appear on a single SS benefits statement when you are 62. Whether or not you begin benefits at age 62, eight years later the COLA would have amounted to about 26% (again, using Mr. Kane's figures), and this COLA applies to all three figures. So, whether you have been taking the low figure for eight years, and withdraw your original application, or whether you waited till age 70 to first begin your benefits, the $2100/month amount would have increased by the same 26%, and this increased amount is the benefit you start getting at age 70.

Posted by: Peter Kane at 06/20/2008 02:54:09 PM

It took a while for me to get my head around the numbers, but kal lawrence�s last posting of June 17th clarified things, and I thank him. Now I am back to implementing a do-over. I learned another piece of information that may be helpful to someone who files for a withdrawal only to learn that they made a serious error in their calculation. It seems that one can actually cancel a request for withdrawal even after the S.S.A. has approved it, as long as it�s done within 60 days after the notice of approval - (S.S.A. Handbook, Article 1515.5). You could call this a do-over of the do-over.

Posted by: ron waddell at 06/21/2008 06:39:57 AM

I don't understand how this is such a good deal. If you have two men who both take social security at 62 and at age 70 one man pays 130,000.00 back to S.S. to increase his monthly checks by 900.00 and the other man does nothing, but continues to recieve his 1,200.00 a month benefit. Say both men live ten more years to age 80. The man who paid back the money to S.S. to increase his monthly benefit will have recieved approx. 108,000.00 more than the other man, in benefits, over the ten year period. But the other man will still have his 130,000.00 plus any interest he would have earned on it, which together would certainly dwarf the 108,000.00 advantage of the other man. I'm just an average Joe, but is my thinking wrong here?

Posted by: John at 06/23/2008 05:40:24 PM

I have been told by 2 different people at Social Security that the "delayed retirment credit" that boosts the monthly payment applies ONLY to (in this case) Rothenhoefer, and not to Charlotte. Thus, if John dies first, Charlotte will not get the same amount (she will get his amount as of his full retirement age). And for this reason, it is not like buying an annuity with a 100% survivor benefit. If anyone can direct me to something to the contrary, I would be anxious to see it.

Posted by: Peter Kane at 06/24/2008 02:26:34 PM

Since no one else responded to John�s June 24th posting, I�ll have a go at it. Your question may have been misinterpreted by whomever you spoke with. My understanding is as follows. To the extent that Charlotte�s benefits are based on John�s work record, they are calculated on John�s �primary insurance amount� (PIA) as long as John is living. This is the amount one would have received at full retirement age (65 years or older depending on the date of birth). Any delayed retirement credits would not be included in calculating Charlotte�s benefit. However, when John dies, Charlotte, as the surviving spouse, would receive John�s full benefit at the time of his death, including any delayed retirement credits. This is stated in the Social Security Handbook, Article 720.3.D.

Posted by: John at 06/25/2008 08:41:57 AM

I just came back to the site to "retract" my comment and saw Peter's explanation. In a follow-up to my discussion with 2 separate 800-number people, I contacted the local office where the person said "that doesn't sound right"; she said she would check on it. The manager of the local office called back and explained it the same way as Peter. Thanks to all. For the record, the manager said that the worst thing you can do is call the 800 number; that's a little unsettling.

Posted by: Dave at 06/29/2008 09:18:13 AM

The article doesn't factor in the earning power he loses when he re-pays the $130,000. At 5% that's $540/month. So his net increase is $360/month, not $900. If my logic is correct, you'd have to live to at least a 100 to make it a good deal. Am I wrong?

Posted by: TD at 06/29/2008 08:02:43 PM

By my calculations the $130,000 earning 5% would provide the same benefits until about age 88. (Assuming all the SSA is taxable and ignoring that SSA is only 85% taxable). If the person dies before then he would be better off keeping the money. However, if he lives to 100 he would be about $100,000 better off by repaying SSA. Place your bets on longevity. If both spouses repay SSA, the survivor only gets the larger amount. If only the higher earner repays the survivor gets the higher amount.

Posted by: Tom West at 06/30/2008 02:57:06 PM

Since I started this whole thread, I now wish to update you all. Here is my situation: Both my wife and I have reached full retirement age, but my wife started drawing SS at age 62. I reached full retirement in Feb/2008 and have decided to delay my benefits (I plan to work full time until age 70; I am in excellent health; and I am a descendant of people famed for their longevity). Until I read Mary Beth Franklin�s column I never dreamed I could, in the meantime, draw spousal benefits. Well, I did apply for spousal benefits. I did so online, which was a mistake, for the application submitted online was misinterpreted by the SSA as an application for benefits drawn on my account, not my wife�s. So I had to withdraw that application. After talking to a local agent, I re-submitted my application and within 10 days a spousal benefit retroactive to February 2008 was deposited in our checking account. Here�s a strange thing: My spousal benefit is calculated at 50% of what my wife would be receiving had she decided to begin drawing benefits at her full retirement age. But remember, she decided to begin drawing at age 62. So my spousal benefit is not 50% of what she currently receives, but 50% of a higher figure. Here is another strange thing. They have switched my Medicare A to my wife�s account, the logic of which completely escapes me. I should receive a new Medicare card soon (I don�t use Medicare--I continue on my employer�s health insurance). By my calculations, I shall have to live only to age 82 for this to become a plus for me. Not only that, by waiting until age 70 I dramatically raise the benefit my wife would draw should I did before her (her health and longevity prospects are even better than mine). But be careful. Mary Beth Franklin is a absolutely correct: many agents in SSA have no idea that one could do this. In my case, three of them gave me totally wrong information. I finally ran into an agent in my local office (Mpls) who got it right. You have to be very persistent!

Posted by: Mary Beth Franklin at 07/01/2008 03:47:26 PM

I am thrilled that my Kiplinger article sparked such a lively debate. I have heard from several readers like Tom West who were able to put some of these strategies to use to boost their SS benefits. One reader who is receiving retirement benefits didn't realize that his 5-year-old child was also entitled to benefits worth up to 1/2 of his monthly amount. He has since applied for her benefit, received more than $40,000 in retroactive payments and she will continue to receive more than $1,000 a month until she is 18. Please share your stories. I'm preparing a follow-up article.

Posted by: Chris Nelson at 07/02/2008 12:27:58 AM

I am sickened to learn of the huge amounts of social security dollars being squandered on minor children of retirees. This is one of the reasons that Social Security is underfunded. Perhaps people who wish to start second families in their old age should do so only if they can afford it.

Posted by: J. Naxxar at 07/02/2008 04:36:14 PM

I am a Federal retiree making $2,519 a month of retirement benefits. Because of the windfall, I am not eligible to collect my husband's social security when he dies. He only receives $650.00 per month, but that money would help me with the cost of living increasing. Is there anyway we can get around this windfall?

Posted by: Jim Cummings at 07/04/2008 08:17:05 AM

A very interesting article. As a CPA, I had never heard of it.

Posted by: Tem at 07/04/2008 02:05:43 PM

I am reading where some of people think it is wrong to take full advantage of the current tax laws and "boost" a retiree's income. If it is legal, what is the problem? When you are at these folks age, you should take full advantage of the laws at that time. I am sure you take full advantage of the laws that benifit you now, right?

Posted by: Ihall at 07/05/2008 02:56:58 PM

Nothing wrong with the kid getting SS $, try all those ex-wives diving in to e'xs ss $ since they earned more than collecting thier own - the recipent monthly annuity does not get reduced. That is where it should be stopped.

Posted by: Jean313 at 07/06/2008 11:07:51 AM

I am outraged that "Bill's" late in life child will receive SS benefits at birth while having two living parents to support him, one still working. When did SS go from providing for the aged to rewarding procreation?

Posted by: terrie at 07/06/2008 11:10:19 AM

I am 72 and actually started collecting benefits at age 62.I used the social security calculators to figure my benefit as if I retired this year. My increase was not close to the 900$ amount shown in the article. After ariving at a "PIA" and increasing that by 130% my increase was still only 500$. What did I do wrong?

Posted by: hello at 07/11/2008 03:13:32 PM

...do not be upset with that man who's children get to collect SS. Chances are their father (who looks like a grandfather) is the exception not the rule. Most of these kids have parents on a fixed income that covers the household exspenses and nothing more. If Dad passes on before the child graduates the household income plummets nearly 50%. Young moms usually quit work also because they get money for a child under 16 or 17. But when that magical birthday hits, the house hold is in topsy-turvy. Ususally that young mother is now a caregiver and will not have a pension of her own. These gold diggers get pregnant to these older men on purpose! And of course, its the children who suffer! Dad usually passed before high school graduation and these bitter ladies end up feeling like a single mom after all.

Posted by: wtf? at 07/13/2008 08:32:15 PM

I love what hello said: "Don't be upset with that man..." followed by "These gold diggers get pregnant..." When a 67 year old man gets a woman pregnant and expects social security to pay for the child; hello calls the woman dirty names...

Posted by: anonymous at 07/18/2008 01:44:44 AM

I think it's discusting that some old fart can remarry, make babies, and soak Social Security--a system that is suppose to support the older citizen. Maybe it is time for an overhaul of the system!!!

Posted by: Stan Oleysyck at 07/18/2008 03:42:19 PM

If a spouse took an early retirement at age 62 (now 70+) and her SS benefits were taxed due to her spouses income -- would they receive a refund of all taxes paid on her SS if she repaid ALL SS received?

Posted by: bkl at 07/23/2008 06:59:15 PM

The SS payments Bill receives for his child belong to the child. He is the custodian of his child's money; SS calls him the "representative payee." The 529 will be owned by the child through a UTMA 529. The state tax deduction, if available, will be the child's on the child's tax return.

Posted by: Chun Wang at 08/04/2008 12:47:53 PM

I went to the local SSA at Flushing NY, 11355 today (Aug.4, 2008) and submitted the form SSA-521. Their representative told me that I have to repay the entire retirement benefits right away with the form -- it is more than $150,000.00 -- not as you said they are going to send me a letter in the future and tell me how much I have to repay. If they are wrong, how can I convince them to change their mind? Thank you in advance.

Posted by: Mary Beth Franklin at 08/11/2008 10:39:03 AM

Responding to Chun Wang.Yes you have to repay all of your SS benefits when you submit your form 521 before you can restart your higher benefits at your current older age. I'd be surprised if SSA could calculate your cumulative benefits on the spot. Normally it takes a few weeks.

Posted by: Mary Beth Franklin at 08/11/2008 10:40:37 AM

Responding to Stan: You can file for a tax credit or an itemized tax deduction for taxes paid on benefits that have been repaid. It's a fairly complicated calculation. See IRS Publication 915.

Posted by: jmb at 08/11/2008 12:19:58 PM

I'm 66 and won't collect SS until age 70. I understand I can now collect spousal benefits on my wife's account retroactive to the time she first started collecting.(Anybody know correct form # ?) Will this reduce my benefits when I start collecting at age 70 ? Thanks

Posted by: Terry Satherlie at 08/11/2008 03:38:15 PM

Can Mary Beth or anyone tell me: If my husband is 66, still working and NOT collecting SS, can I, (age 59, and not working) collect half of his SS benefits allowed.

Posted by: Mary Beth Fraklin at 08/12/2008 08:19:11 AM

To JMB: Once you reach your normal retirement age, you can "restrict" your application to begin receiving SS retirement benefits to "spousal benefits onl"y. There is no special form, but be advised that many SSA agents are not aware of this nuance. By collecting spousal benefits only starting at 66,you can then switch to your own higher benefits at 70 which will include four years worth of delayed retirement credits boosting your benefit to 132% of what it would have been at age 66.

Posted by: Mary Beth Franklin at 08/12/2008 08:21:38 AM

To Terry: Sorry, that won't work. The earliest you can collect SS retirement benefits is 62 and at that age, your benefits will be reduced by 25% or more for the rest of your life. (Widows can collect reduced survivor benefits at 60.) To be able to restrict your application to spousal benefits only, you must be at least normal retirement age, which is 66 for anyone born between 1943 and 1954.

Posted by: Angela Stading at 08/13/2008 07:58:10 AM

My parents are divorced and one is deceased as of 1989 and neither remarried. I read an article about 10 years ago that stated that the former spouse could collect the other's Social Security once he or she reaches retirement age, whether the ex-spouse is deceased or not. Is this true? Also, could one collect on a deceased ex-spouse's Social Security now, even though the divorce took place before his death?

Posted by: Bob Iverson at 08/13/2008 08:13:42 AM

I quit working at 64 and started to collect SS. If I stay unemployed until I'm 70, will I receive higher benefits by repaying what I've received and reapplying? A SS agent told me you have to keep working for this strategy to pay off. Thanks.

Posted by: Moving On at 08/13/2008 09:16:39 AM

My husband of 35 years has 'moved on' to a younger wife. He is collecting SS since he was 62 and is now 67. I will be turning 66 this year, but plan continuing to work and to not begin receiving my own SS benefits until age 70. In the meantime, can I file for Spousal Benefits Only and collect from HIS SS, even though we are divorced?

Posted by: gordon wells at 08/13/2008 09:16:40 AM

I fell off a ladder and broke my neck I was a fully employed painter working for the state of California at the time of the accident. The state medically disabled me from my employment. My income dropped to less than half of my monthly salary at time of release. I am being taxed by the Feds and the State, is this correct or am I being mistakenly taxed on my monthly medical retirement benefit. After taxes I went from receiving under half to barely one third of my salary I received as a painter. Can you please find me an answer to my question of taxing a medical retirement benefit? I have tried myself buy was unsuccessful. Though I did manage to find out that some medical retirement state employees do not get taxed on their monthly disability check ... confused ... thank you Gordon

Posted by: Ruth at 08/13/2008 12:06:55 PM

Would it be wise for me to do the pay back as I started collecting on my ex husbands ss when I reached 62. I will be 70 in Nov. and wondered if my benefit would increase enough to make this worth while. My benefit started off in the $400's and now is up to $619.I wold owe ss a hefty sum but if it is worth it I would do it.

Posted by: Mary Beth Franklin at 08/13/2008 01:34:20 PM

Bob, Thanks for your question. I'm the author of this article. You can pay back all the SS benefits you have received so far--interest free--and reapply for benefits later at an older age. Even if you don't continue to work, you would received a delayed retirement credit of 8% for every year you delay collecting between you normal retirement age (66 in your case) up until age 70. You'd have to crunch the numbers to see if it would be worth it for you to pay back your benefits vs how much more you would receive by reapplying later.

Posted by: Mary Beth Franklin at 08/13/2008 01:38:34 PM

To Moving On: Here's an answer to your question. --Divorced women married at least 10 years are eligible for Social Security on the ex-husband�s record if they are unmarried at the time they become eligible for Social Security. --Any benefits paid to a divorced spouse DO NOT reduce payments made to the ex or any payments due the ex�s current spouse if he remarried. --Generally, the same payment rules apply to divorced wives and widows as to current wives and widows. That means most divorced women collect their own Social Security while the ex is alive, but can apply for higher widow�s rates when he dies.

Posted by: Mary Beth at 08/13/2008 02:30:55 PM

Ruth, You'll have to crunch the numbers to see if it is worth it to repay all the benefits you have received over the last eight years and reapply for higher benefits at 70. For example, let's say you have to repay $48,000 and when you reapply for benefits, you'd be entitled to $1,020 a month--$400 more a month than you receive now. You would have to live at least 10 more years ($48,000 divided by $400 = 120 months or 10 years) to reach a break even point on your repayment.

Posted by: Faith M. Stayer at 08/13/2008 02:55:18 PM

...I receive monthly disability benefits from Social Security and the Teachers' Retirement System of Georgia. Am I required to pay state and federal taxes on both monthly checks?... ...On another matter, does the "Social Security Do-Over Strategy" apply to retirees who receive Social Security Disability payments or only to nondisabled retirees?...

Posted by: Dick Weaver at 08/13/2008 09:46:23 PM

Repayment of a significant amount of money is a very complex calculation and should not exclude the interest and lost opportunity value of the repayment dollars. If you include the interest lost, opportunity cost and risk of demise prior to the repayment, and the present value of continued payments; it is highly unlikely that it is a prudent decision. Bird in the hand is worth two in the bush. I know of too many people who try to outsmart the grim reaper and they just lose a lot of value by deferring SS and even more by paying back paid benefits. If it is only a year or two of payback, it may be worth the risk but anymore than that, the risk is too high. If you look at the whole picture, you should collect as early after 62 that you can as long as you don't have >$12,000 in earned income - which incurs penalty to SS payments. Take it early, don't look back and scrap the risk of repayment of significant lump sums. You will sleep better at night.

Posted by: Dick Weaver at 08/13/2008 10:43:48 PM

The payments for minor children of SSA recipients are not well known and will gall many of us as one of the reason SSA is in deep dodo. I am a friend of one senior citizen who applied for benefits only to find that each of his minor children could get about $700 a month. The kids didn't even live with him as the second family lived with ex #2. They collected thousands and the dad used the cash to pay his child support. Now that is Federal subsidy....to pay legal support obligations!!! That certainly was not the intent of SSA when visioned last century; but one perk awarded seniors by a congress out of control who don't even participate in SSA. Have Congress participate in SSA and these type of giveaways will cease immediately. Unless, of course, some of the geezers in Congress have second families and they could tap into the "program" themselves.

Posted by: Bob at 08/14/2008 03:16:09 AM

In the calculation for Ruth to recoup her payback would it not be appropriate to consider the loss of interest (or whatever investment vehicle was in place) on the $48,000 that would be paid back?

Posted by: jack black at 08/15/2008 02:45:56 PM

67,8/08, I got SS$ of $2230($1966 +$234/mo to Medicare)since 2/07.I will make $50K as a consultant 12/08-3/09 and will have to pay full SS on it. Is it worthwhile for me to do a SS Withdrawal of Application( 18 months of $1966 or $35388) with my net from the $50K gross and then reapply for stepped up 8%, or more, higher SS monthly payments once the consultancy was over in 4/09? I would keep the Medicare going. Could I do another consultancy in 2010 and do the same thing to gradually get to an age 70 maximum SS monthly payment? I am in good health. Thanks

Posted by: Joanne Linehan at 08/17/2008 10:56:46 AM

I agree with Chris Nelson and others who believe SS was not set up to provide benefits for old farts starting new families. Maybe it is time to weed out the old greedy people? Our young people are paying to support seniors, and as I have collected SS for 10 years, I am very grateful.

Posted by: carry waters at 08/17/2008 04:39:25 PM

I retired from teaching in public education after 27 years, getting almost a full pension. Then I worked another 15 years and became eligible for SS. I find out that California teachers have their social security bnefits reduced by the size of their pension. This rule called a windfall prvision HA HA, does not apply to other professions. I feel this is unfair and unequal treatment, especially since teacher are low paid, and so not able to save a great deal fr retirement. Does anyone know if this law will be repealed?

Posted by: Smile at 08/17/2008 10:05:36 PM

Can I collect spousal retirement benefits? I am a federal civil service employee, married to ex for 22 years. i will collect civil service retirement in about 6 years. I have not paid into SS for the 40 quarters required for my own SS benefits. Can I collect any SS benefits under my own pay in to e'xs pay into SS? Thanks

Posted by: Melinda Bandow at 08/18/2008 04:13:12 PM

I am 69 and have been collecting ss# since my 65th birthday. I also continue to work full time. I cannot take advantage of the payback loophole as the reason I did not delay collecting is that we needed the money (and still do) My husband is a truck driver and has had 3 companies close from under him in the past 4 years. He will be 62 in December. Is there some way that I can maximize my benefits? I currently receive $1100 per month.

Posted by: Reane at 08/20/2008 01:59:35 PM

My last child by my deceased ex turned 18 but I recently received a letter from SSI stating "We raised your monthly benefit to $1694.00.....We cannot pay you monthly benefits at this time. Why do I keep getting this letter if I don't qualify...?

Posted by: A Phillips at 08/29/2008 04:58:55 PM

I am shocked and appalled by this article...I am in my mid-twenties and struggling to make ends meet while fulfilling my dream of public service. My hard earned money is being used to supplement their college kitty. Shame on the McCarrens, shame on the lawmakers who leave loopholes for such greedy individuals and shame on Kiplinger

Posted by: jo at 09/09/2008 09:23:40 AM

to carry, consider yourself very lucky to have that pension option. most of us in the private sector lost our pensions to 401ks where there is no promised guaranteed return. now that's unfair. as a taxpayer i would have to increase my taxes to bailout your pension plan if it sustains large losses, but my plan has no recovery from fund losses. as for low paid teachers, not at all in long island, ny & other metro areas. their compensation dominates most private sector opportunities. govt. funded positions should be subject to the same market forces that its taxpayer base is controlled by....salary wise...

Posted by: Shelley at 09/09/2008 05:23:57 PM

My situation is similar to Carrie Waters. I worked at a private catholic hospital and paid into SS from 1980-1998. I went back to school earned a doctorate and since 1998 I have been teaching higher ed in California. I have been informed that due to the "windfall provision" my SS will be cut by as much as 2/3 because I will receive a pension from STRS (State Teachers Retirement). Since I changed careers later in life my STRS retirement will be low (approximately 30% of my salary if I work until age 65). I pay over $900 per month into STRS. I will not get my full SS even though I have paid into both (SS and STRS) for many years. This is not fair! Does anyone know if this law will be changed? If not, does anyone know a way to (deal with) this law?

Posted by: Jana at 09/10/2008 01:00:21 PM

To A Phillips. "Shocked and Appalled" are you? Life moves faster than you expect -- you may need this sooner than you realize. Guess what, it probably was "just yesterday" that the McCarrens... thought they could do great things too. They are not saying why they choose to retire at 62, but I'm betting on ill-health -- something which obviously you know nothing about at your age. If you continue with "public service" you will definitely need social security etc. If people your age keep yapping about it, the Goverment will be happy to take Social Security away again or lower the amounts, and then your generation can go back to eating "dog food" and starving !!!!!...

Posted by: S. Martinez at 09/10/2008 10:35:37 PM

I, too, am appalled by the McCarrens. Since when is SS to be used because an older man elects to have a child, and now the American people are expected to provide for his child's support and education? This is an extreme abuse of the intent of SS regardless of the existence of a loophole, and shame on Kiplinger for publishing this loophole to cause further inappropriate outflow of funds from the system.

Posted by: Susan at 09/12/2008 06:36:37 AM

For individuals who were employed under STRS or PERS, there is something called the Winfall Elimination that reduces how much Social Security you receive. To get straight information about it check the Social Security online website. STRS & Social Security. If you have more than 20 years under Social Security the amount of the reduction is reduced up to 30 years inwhich you would get 100% of both your STRS and Social Security.

Posted by: Eddie at 09/14/2008 12:48:24 PM

My wife and I will both soon turn 62. She is currently non-working but is eligible for social security due to work in her earlier years. I plan to continue working for the forseeable future (at a higher than average income). If she chooses to start collecting social security at 62, will she have to pay taxes on the social security income because of the income I will still be making? By the way, to the complaining young ones. Don't forget, most of us older ones have been contributing to social security for forty-five years or more. So you are not supporting most of us.

Posted by: John A at 09/14/2008 06:42:19 PM

VERY interesting article and thread! Two concise follow-on questions: 1. We're both 60 and both have plenty of "quarters" w/ good income histories. My wife will take her own SS early at age 62. But, IF we do NOT need it, given the big advantage of a MUCH higher payment for me, w/ much higher Survivor benefit for her, is there ANY reason for me to take SS before age 70? (My wife will take her own early at age 62.) 2. Is there ANY reason for everyone who is delaying their own SS claim to NOT claim spousal benefit when they're SS full retirement age?

Posted by: Don at 09/21/2008 12:07:58 AM

I learned something from this thread, but not enough. I am left wondering if a Federal employee who retired and began receiving SS benefits at age 65 due to other work, and receiving about $500 per month reduced payment because of the windfall provisions, can withdraw his application, payback SS received and start again at age 73. I guess it would not be much of a payback since we are talking about eight years. I would have to crunch the numbers, of course. As to "old geezers" accepting payment for their children, that is really an insult. We paid into the system or did not receive benefits for up to, say, 50 years, thus taking care of your parents or grandparents. That is how the system works. Would you really like to see a widow and children in poverty. I did not remarry after my wife died, because I wanted to protect my few assets to give them to my adult daughter when I kick the bucket. However, to the guys who did remarry and have been happily raising their kids, I say GOOD FOR YOU! You have a right to happiness and if it means having a family with kids, that is OK with me. Also, when I tried to meet single/widowed/divorced women with children, they unanimously rejected me. That is the American Way, folks. These older gents, most likely, married women from other countries who do not loath older people, men or women.

Posted by: walt h at 09/23/2008 11:13:31 AM

This is a variation of Tom Wests post & MB Franklins answer of 6/4/08. Can my wife, age 60, collect spousal benefits based on my benefits, until she reaches age 70? She has her own work history. If the above is possible, at what age can she start to collect? I have been collecting since age 65

Posted by: peter simard at 09/25/2008 02:46:23 PM

if I take the benefit at 66 and suspend so my wife can have the 50% what happens if she keeps working (she is 2 years younger, are the benefits reduced??

Posted by: jean at 09/29/2008 10:15:24 AM

I am 66 and retired at 62 with good ss benefits. My husband is 64, took retirement at 62, and after reading your article, repaid benefits to return to work and retire at 66, his full retirement age. At what age can he file for spousal benefits and can he continue to work?

Posted by: Stephanie Kirch at 10/06/2008 10:14:11 AM

For those readers who wonder how to pay back their social security proceeds without being forced to sell their income or retirement assets at a loss, thus wiping out the financial benefits of the Social Security do-over, I would like to suggest the option of using a government-insured reverse mortgage to cash out part or all of the equity in their home and apply those tax-free proceeds to their Social Security do-over strategy. Many myths persist about the pre-1989 reverse mortgage, when banks sometimes took over the home. However, the modern Home Equity Conversion Mortgage (HECM) is insured by the FHA and is highly regulated to prevent abuses. More information is available from the non-profit National Reverse Mortgage Lenders Association.

Posted by: Lois at 10/12/2008 12:16:45 PM

Does anyone know when the spousal benefit provision first became effective?...

Posted by: raquelita at 10/21/2008 08:25:10 PM

What happens if a person decides to do this at 73. Is it a less worthwhile option because of the extra SS received?

Posted by: Rose at 10/22/2008 11:15:53 AM

Is it possible to file for this from the beginning (before reaching the age to collect social secirity) so that we need not have to pay back the social security already received?

Posted by: Carol Wall at 10/22/2008 02:03:35 PM

Who sponsored the bill to allow the children of old fathers get social security benefits? It is unconscionable.

Posted by: Karen at 10/22/2008 09:24:02 PM

I so agree with Carol Wall about the Social Security Benefits...There are just so many immigrants (whose grandchildren)...collect all this money!

Posted by: Hello all at 10/23/2008 12:26:14 AM

Benefits to survivors, wives and children have been in place since 1939. Benefits to divorced spouses do not affect the current spouse or numberholder, no matter how many ex-es there may be. Congress has paid into Social Security since 1984. Yes, they have - almost a quarter century. And yes, you can put off taking your own retirement IF you are full retirement age and take your spousal benefit instead. If you aren't full retirement age, you must take your own retirement as well. Check with your local office. All of this information will be well known to them.

Posted by: Lois at 10/24/2008 02:54:20 PM

I previously asked a question about receiving spousal benefits; however, I don't think my question was specific enough. I would like to know when the provision that allow spouses to receive ONLY spousal benefits first became available. I want to collect on my husband's record now (I am full retirement age)and delay receiving benefits on my own record until I am age 70. Has this provision been available since 1939? I think Hello All addressed this question in part. I would like some more information on my specific case. Thanks in advance.

Posted by: Sandi at 12/11/2008 06:58:32 PM

I am at full-retirement age and read the article in Kiplinger about receiving 1/2 of my ex-husband's benefit and delay taking my own until I am 70. When I visited the Social Security Office, I explained what I wanted to do and was given the forms to fill out. When I did not receive my first payment, I called and was told I needed to sign an additional form to suspend payment of my benefit. When the second payment did not come either, I called the toll-free number and was told I could not collect my ex-husband's benefit because my benefit was more that 1/2 of his and I had to take the benefit which was the most. I wish someone could tell me the provision in the Social Security code that allows one to take 1/2 of spouse's and delay taking one's own regardless of whose is the largest benefit.

Posted by: Mary Beth at 12/12/2008 01:53:14 PM

Sandi, Hi, this is Mary Beth Regan, author of the article. You are not alone if having difficulties getting the benefit you requested. Ask to speak to a supervisor and tell them you want to "restrict your claim to spousal benefits only." You are allowed to do that once you reach your normall retirement age. (since this is your ex-husband, to qualify for benefits as a divorced spouse you must have been married at least 10 years.) If you continue to have problems, please contact me directly at mbfranklin@kiplinger.com.

Posted by: Olga at 01/16/2009 09:23:27 AM

Good Morning: My question is this, I am 55, my husband is 58 & receives his SS and pension due to a disability. He gets from SS 1,600/mo. If I retire at 62 do I qualify for 1/2 of his benefits and does this reduce his payment?

Posted by: Mary Beth at 01/16/2009 08:04:56 PM

Olga, hi this is Mary Beth Franklin, author of this article. When your husband becomes 66, his disability benefits will be converted to SS retirement benefits and normal SS retirement rules will apply. If you claim benefits at 62, your benefits will be reduced by 25% for the rest of your life. You will receive the higher of benefits earned on your own work record and/or spousal benefits based on your husband's record. Spousal benefits are worth 1/2 of your husband's benefits at your normal retirement age o 66. Less if you claim earlier (as much as 25% less at 62.) However, if you wait until 66 to claim benefits, you can request "spousal benefits onl"y which would be half of what he receives and delay collect your own benefit until age 70. For every year you delay collect SS benefits beyond your normal retirement age of 66, your benefits will be increased by 8% a year for a total of 132%. Hope this helps.

Posted by: Sandi Kinton at 02/02/2009 07:57:33 PM

Mary Beth, thank you so much for your response to my blog a few weeks ago. I was trying to receive one half of my ex-husband's ss and delay taking mine until I turn 70. It took three and a half months, numberous phone calls, and a lot of frustration, but I finally received my first check. I ran the numbers and if I live to 85, the difference I will receive by waiting until 70 is $100,000. Your article was a god-send.

Posted by: Bill at 02/09/2009 03:26:58 PM

If two people who are each entitled in their right to social security benefits get married, are the amounts they receive affected?

Posted by: Jean at 02/18/2009 08:01:54 PM

We did just this thing, and now we're reaping 50% more on my husband's monthly check. AWESOME! He started benefits at 62, stopped his SSA in July, repaid back almost $100k in October (because we also had to pay back all of the benefits paid to our adult child who was drawing off his benefits), and received his 1st check at the new rate in January + lump pmt of back benefits from October 1. Same for our daughter, tho that one took a little longer. (We had to re-file for benefits on her - which no one told us; but her effective date was also October, it turned out, because she is on his record.) It was a wonderful option to exercise --- and you are right -- most people at SSA didn't know...about it -- tho it all came out in the wash. Sweet Deal.

Posted by: Joy at 02/21/2009 09:14:04 AM

If my husband files for and collect his own reduced SS at age 62 (in 1 year) and still works with the allowable non-penalty income range, is he still eligible to switch to SS survivor benefits from my higher SS at 100% if I predecease him? What if I predeceased him but I had not reached my full retirement age of 66? Thank you very much. Also: I have heard that Congress is about to make a substantive increase (perhaps to the $18,000-20,000 range)in the amount of allowable income which is not penalized for early SS recipients at age 62-prior to full retirement age. Do you have info on this? I will appreciate any other related recommendations you have. Thank you, Joy.

Posted by: TT at 02/22/2009 02:24:03 PM

No wonder Social "Security" will probably run out by the time I'm ready to retire. I find it ridiculous that people get a check and have NEVER paid into the system. I understand they may have worked at home, my point is they didn't pay into the system just the working spouse, typically the male. Let's take single male making $50k and a married man making the same. The married guy pays less into the system due to other tax discounts. When they reach 65 both will get their own check. But, the married guy's wife now also gets 50% of his amount. UMM...where does that money then come from? Exactly. That's why we're going broke with this system. And, the married couple now get to live a better retirement as they have 50% percent more income than the single person. Yeah, equal..it sure is. I just learned of this. I always thought you ONLY get retirement if you've worked and paid into the system, and your spouse will get a reduced check when the "had worked" spouse dies. No, not the cause. My parents are now retiring and both worked very hard their whole lives. My mom will get a benefit check based on her paying into the system. It's barely more than other women her age that didn't pay a penny into the system and the male spouses both made and paid about the same. So, the benefit for my parents both working doesn't result in double the retirement to the 50% working couple. My parents will only get a couple hundred more per month. It's not even close to fair, and it's a system based on an old-fashioned America where mom stayed home and dad worked. That has been an archaic notion since at least the early 70's. It's not 2009 and the government is still wasting money.

Posted by: Sharon Crawford at 02/26/2009 04:08:15 PM

I think it's ridlicious that a stay at home spouse can get 1/2 of their husband's ss and minor children can get 1/2, the only person that contributed was the working husband, in the real world of pensions, only the person who worked gets a check and only for themselves, if they want a surviving spouse to get something when they die their pension is reduced...This system is most unfair to the working wife...if her spouse dies she can't keep her ss and get half of her spouses, but yet the spouse who never contributed a cent can get half of their deceased spouse's. I wonder what bank we could all find that we could go to every month and they would give us money when we had never put anything into it to begin with. This needs to be changed, no wonder they are running out of money, it is not up to us to take care of minor children and surviving spouses. What do we have to do to get this system changed? Any ideas please post them

Posted by: michael at 03/17/2009 12:06:13 PM

it does not matter because 45% of all males die before age 67 Retiement age and 20% of all females die before 67. this means they never get SS benefits and the best news is that people are starting to die earlier according to the 2005 mortality report. If the trends keep up the goverment will not have a finacial problem. Enjoy your life because it is not significant that you will have the chance to enjoy the retirement.

Posted by: Dee at 03/21/2009 09:01:14 PM

I am very surprised that alot of people do not know that way back when the wives did not work that the man of the house was paying double ss. Because that is how the government paid the spouse 50% of what the man of the house got. BUT remember he paid Double But his spouse only got 50%. Now the wife is working BUT they never changed the law and the man still pays double ss and his wife also pays ss now the government gets paid 3 times from the same household....YOU are being over taxed and under paid......So anytime you can get your monry back DO IT

Posted by: Owen at 04/10/2009 11:30:17 PM

Mary Beth Franklin, thanks for the good advice. If you are still responding, I have a question. My wife began collecting reduced social security on her earnings a year ago. I plan to file for a "spousal benefit only" in two years when I am 66 and then file for full benefits on my own earnings when I am 70. I know that my wife will be able to keep receiving my benefit if I die after I begin collecting an increased benefit at age 70 (which will be much larger than the benfit she is collecting on her earnings); but if I die before I am 70 (and therefore before I begin collection a benefit based on my own earnings), will she then be able to collect what I would have collected if I had began collecting on my own earnings at the date of my death? I do not want my delay in collecting a benefit on my own earnings to keep her from collecting a larger amount after I die.

Posted by: Patti at 04/11/2009 07:51:04 PM

I was divorced in 1982 after 25 years of marriage. I was single when I applied for Social Security benefits at age 65 in 2002. My ex-husband was still working at a high rate of pay. He passed away in 2005 at age 70. I don't know when he took his Social Security or what the amount was. How can I find out if I received -- and am receiving -- the maximum I should have coming?

Posted by: Mary Beth Franklin at 04/13/2009 10:26:27 AM

Dear Owen, Mary Beth here. Yes,if you die before collecting your delayed Social Security retirement benefits, your wife would be entitled to the full amount you would have received for your age at death. Hope this helps.

Posted by: Mary Beth Franklin at 04/13/2009 10:31:01 AM

Dear Patti, Mary Beth Franklin here. As long as you were married at least 10 years and have not remarried when you apply for Social Security, you are entitled to Social Security benefits based on your ex-husband's earnings record. That includes the higher widow's benefit that is equal to 100% of what he received. Call SSA to make sure you are receiving the correct amount. Hope this helps.

Posted by: Owen at 04/16/2009 11:49:57 PM

Mary Beth Franklin, thank you for your previous response. My wife is collecting social security on her earnings, and her social security benefits are reduced by the Windfall Elimination Provision (WEP). When I apply for spousal benefits, will the fact that her benefits are reduced by WEP affect the amount of my spousal benefits. In other words, will my spousal benefits be calculated as if WEP did not apply to (or reduce) her benefits. I do not think it is relevant to my question, but the Government Pension Offset should not reduce my spousal benefits since (unlike my wife), I do not receive a pension based on work in which I did not pay Social Security taxes. Thank you again for being so generous with your time.

Posted by: Don Velozo at 04/17/2009 01:03:28 PM

I am 76 and on SS. I have continued to work partime in retirement. My yearly income from working has been from $46,909 to $4777 since 2001. Averaging $24,266 yearly thru 2008. Should my monthly SS have been increased beyond normal COLA as result of these earnings?

Posted by: Lastmate at 04/29/2009 10:47:40 AM

The daughter we adopted from foster care 5 yrs ago will be 14 when I turn 62 in 2010, so apparently will be eligible to receive 50% of my SS benefit until she's 18 (or to age 19 if still in secondary school fulltime?). If I wait till my full retirement age of 66, she will turn 18 just 3 months after my 66th birthday, so would presumably receive benefits for a much shorter amt of time. Or would she still be eligible for the 50% benefit when I'm 62 if I defer my own benefits till later (and if so, would my daughter's benefit increase when I begin drawing my own deferred, higher benefit)? My husband's a yr older but his SS benefit will be subject to the Windfall provisions, so will be smaller than mine. Will he be eligible for a spousal benefit in lieu of his own, and if so, will it also be subject to the windfall provisions? Also, do you know if any SS benefit my daughter receives after I turn 62 will count as her own income in means-based college financial aid formulas, even though those benefits would be ending before or right around the time she would be ready to start her Freshman yr of college? Financial aid applications must be submitted many months prior to the student's 1st semester of college, so are they based on his/her income at that time, or anticipated income during college?

Posted by: Mary Beth Franklin at 04/30/2009 08:55:04 AM

Dear LastMate, hi, Mary Beth Franklin here. You certainly have a lot of questions to consider when deciding when to start collecting your SS benefits. I'm not sure I can answer them all here. But the most significant pertains to your adopted daughter. Once you begin collecting benefits, she is entitled to half of your benefits until she turns 18. So you have to weigh the value of collecting your reduced benefits at 62, including 50% for your daughter, versus waiting until 66 to collect your full benefits which would entitle her to only three months of benefits. She can't collect benefits until you do. Hope this helps.

Posted by: S Estoque at 05/09/2009 07:44:39 PM

I am 70 and receiving full SSS benefits when applied for it at age 65. I have continued to work full time in retirement. My yearly income from working has been from $100,000 to $200,000. I have continued contributing to SSS since after my 65th birthday to the present time and maybe for the next ten years. Should my monthly SSS have been increased as result of these earnings?

Posted by: tt at 05/31/2009 07:09:12 AM

This scheme is a house-of-cards bull$%!&

Posted by: Jim Cerra at 07/01/2009 07:55:58 PM

Am age 70 and interested in social security "do-over". What is the process to follow to recapture the income taxes which you have previously paid on the benefits you are paying back. Does it require filing amended returns for the years in question, but I am advised you can only file amended returns three years back. That would not generate a return of the taxes paid for five years of benefits. How do you get it all back?

Posted by: Jas at 08/16/2009 10:56:43 PM

Well, I am 56 years old and my spouse passed away at 81 years of age. He has two retirement checks from federal and civil. I am in the state of hardship, after my heart and brain surgery and could not work normally. How can I get some disability to help me from all my finances from Social Security agency?

Posted by: Katie Van Hooser at 08/24/2009 01:03:51 PM

Can a debt collector get any of my ss?

Posted by: I Can Do Math at 09/28/2009 10:43:25 AM

That's great and all, but how long will it take to make up that huge lump sum that you've just sent back to SS? Even making an additional $1000 per month will take at least 15 years to break even. I'm not sure a 70 year old can bank on living to 85...

Posted by: Herman at 09/28/2009 04:35:20 PM

How long does this take to restart benifits?

Posted by: old car buff at 10/02/2009 01:56:25 PM

OK, here's my situation. mid 50s - I was widowed in my 40s with a child still in high school. I was working full time, so at the time I only filed for my son's benefits until he graduated from high school (and immediately went into the Marines - but that's another story). If I'm understanding the article, I can collect on my late husband's account after age 62. I will still be working at that point. Does the $1 loss for $2 wages over the $15K rule apply to taking the spousal benefit? And it impacts my own record not at all?????

Posted by: joey j at 10/13/2009 03:11:52 PM

old car buff, you can start collecting benefits cuz you are widowed at age 60 approx 71.5 percent of what your husband would get

Posted by: I Ran at 10/19/2009 12:21:47 AM

My wife has been receiving spousal support for three years. She is currently 67 years old. Is it possible to do a "do over" on spousal support only?

Posted by: cindy at 10/24/2009 12:44:58 PM

Do benefits decrease if I stopped working at age 52? I am confused. my ss statement earnings say what my estimate is....but does it stay at that amount until I am 62 or 65 without working anymore?

Posted by: Paul Marx (honey) at 11/04/2009 03:18:34 PM

This is interesting!

Posted by: Paul Marx (honey) at 11/04/2009 03:18:35 PM

This is interesting!

Posted by: Patsy Meadors at 11/24/2009 08:56:13 PM

I receive social security disability. My question would be, are there any suggestions that could help me increase my monthly amount?

Posted by: Luz at 11/28/2009 01:02:59 PM

Hello. Q: I am wondering if my husband who is british but not resident of this country can callect some of my SS beneficts when whe he became 66 years old. he is now 61 and I am 60 still working.

Posted by: ANISSA at 11/29/2009 12:20:24 AM

IM DISABLE N RECIEVE BENEFITS HOW DO WE GO BOUT GETTING MORE EVEN THOU ECONOMY IS LOW AND MY CHILD WAS BORN DISABLED THEY GOT ME WHEN I WAS WORKING FOR HIM NOW THAT IM NOT WORKING ANYMORE IM STILL GETTING PENALIZE FOR HIM LIKE I WAS WORKING

Posted by: mick at 11/29/2009 12:22:23 PM

I will try to maximize my benefit for myself and my children. What many of you do not realize is that this is money I have paid my entire life. This is not a welfare program. All of you young whiners should just shut up. You have paid noting into the system but had your greedy little hands out for your mommy and daddys money. Not to mention student loans. STFU! Dont worry little children, I will be the one driving 25 in a 75 while you are honking and flipping me off!! HaHa! Funny how you dont complain about welfare or health reform or banking bailouts. You want to believe you are a victim. So typical for two generations. Dont worry, I will take my SS to a foreign country where my kids will at least get a decent education.

Posted by: Don Miller at 11/30/2009 02:15:12 PM

Obviously I have had better luck in a SS rep, as she explained the one time payback,survivor increase, etc. But two things in this whole thread that I haven't heard mentioned much or at all 1)you can be taxed up to 85% of your social security benefits dependinding on how much you make---so the one time payback definatily makes sense if you are making to much pre retirement age and 2) Social Security was never ever meant to live on--it was meant to supplement your retirement years---and (started) way back when life expectancy was far less than today------So that is another reason SS is going brokea.

Posted by: Joe Reisman at 11/30/2009 08:25:29 PM

What about the taxes? Assuming that the Social Security is taxed to the limit, can amended returns be filed for three years? More?

Posted by: Don Miller at 11/30/2009 11:27:00 PM

I hate to disagree with mick----but social security is a welfare program----a giant ponzi scheme----1st of all 1/2 the money that is paid into our SS accounts is paid by our employers-----plus again when SS was started there were 10 to 12 workers paying into it for each person that was collecting it---so there was a huge surplus-----now i believe there are only 3 people paying in to it for each one collecting-------next minor point that is missing is that we almost are all going to collect far more in benefits than we ever paid into it----plus so many people are retiring at 62 and not waiting for full retirement age---= and no i am not a youngster I am collecting social security-- I was down sized and had to collect early--even with my reduced payment of $1237 a month--I will get back everything I paid into social security in 37.7 months and with my genes I will probably live to be in my 90's

Posted by: Sandi Jones at 12/01/2009 02:43:07 AM

I am currently 62, my husband 58. We both plan to retire in 4 years. I am the higher earner and have longevity in my family, so the surviving spouse benefits do not apply. I was planning to delay SS payments until age 70. My question is; could my husband start to collect early his own benefit-at age 62- then switch to spousal benefits when I apply at age 70, he will be 66 at the time? I am sorry but all the examples assume the husband to be the higher earner. Also, I will receive a teacher pension from NH but will be living in Ohio. Will this reduce my benefit?

Posted by: Bill D at 12/02/2009 05:07:19 PM

Back to the initial computation - Peter Kane (6/9/08 comment) had it right. kal lawrence (6/17/08 comment) assumed that the benefit at age 70 would increase by inflation - it does not. The income indexing that is used to adjust lifetme earnings for inflation stops at age 62, so a $1200 age 62 benefit would result in a $2100 age 70 benefit (no adjusting up for inflation). In the intervening 8 years of receivings early benefits, the $1200 would be increased by COLA's each year resulting in the $1520 benefit Peter mentioned. COLA's on the $2100 benefit would only kick in after that age 70 benefit started. Search for Indexing Factors at Social Security's website for more info.

Posted by: mary at 12/03/2009 10:23:20 PM

????re: If, for example, you received $1,200 a month starting at age 62, plus annual cost-of-living adjustments through age 70, you would have to repay about $130,000. That's a lot of money, but for some people it's worth the price to get an additional $900 a month in retirement. By comparison, it would cost a 70-year-old man about $190,000 to buy an immediate annuity that would provide $900 a month initially, >first who would spend that on an annuity at age 70, second, it woukd take 12 years to break even on the 130K you just shelled out.....does not sound very promising to me,

Posted by: Bill D at 12/07/2009 03:59:38 PM

To Mary (12/3 comment) The point of my earlier comment was that the additional benefit wouldn't be $900 - it would be $2100 - $1520 = $580.

Posted by: Janice Dial at 12/09/2009 05:24:22 PM

I was told if you receive benefits for 2 children due to a spouse's death, if one child's benefits end the other child's benefits would go up, is this true? Then I was told if there is only 2 children then their will be no increase in the last child's benefits? Please tell me which information is correct...

Posted by: Sharon Gitlin at 12/15/2009 02:26:32 AM

Thanks for mentioning the children's benefit. This is something that we could have taken advantage of for a few years before my husband passed away. I didn't know this benefit existed until then. My son was able to get 6 months of benefits retroactively. However, we missed out on years of this. Thankfully we will be getting survivors benefits. Hooray.

Posted by: Crimson at 01/03/2010 12:07:52 PM

My husband became unemployed on Sept 30, 2009. The company had been threatening downsizing all year, and I believe they were making the older employer's lives so miserable that they would either quit or have a nervous breakdown. He ended up in the emergency room because of the stress. He will be 65 this year. He gets no unemployment check and of course lost our medical insurance. He does not want to file for SS benefits yet because he is trying to get the highest amount possible. This is putting a huge burden on me to keep up with the monthly bills on my small paycheck. By not having any job at all, is it really that beneficial to wait to file for social security benefits? Oh ... I am 7 years younger than he is, ( He is 64 and I am 57) so even though he can get on Medicare soon, I will have no insurance for 7 more years.....seems to be a major glitch in older people getting the help they need!

Posted by: Ed Hoelker at 01/13/2010 09:15:05 AM

My Dad is 86 and started drawing SS at age 65. If he were to repay the SS he has already received and reapply, would he get the back payments from SS from age 70 to the current date? Or would he just start receiving SS monthly payments moving forward? All the examples I've seen are for people who are near 70 currently. Thanks, this has been very informative with a very low rant to quality posting ratio.

Posted by: Mike G at 01/14/2010 10:30:06 PM

I turned 65 in 2007 & began taking my ss in Aug of 2008(65 & 8 mo). I continue to work while drawing my ss. My wife will turn 62 later this month & plans on working until 66. From what I have read here she could begin drawing her spousal benifit upon turning 62 & then begin her full ss benifit at 66. Is this correct?

Posted by: George at 01/15/2010 03:50:59 PM

When I turn age 66 my wife will be 62. Does she have to be collecting her SS benefits for me to claim the spousal benefit?

Posted by: Tony Marquis at 01/16/2010 05:35:42 PM

I am 73 and have collected S/S payments since age 65. My wife is approaching 62 and will be eligible for the maximum benefit, based on her cumulative earnings, as I was. Can she apply at 62 for a 'spousal benefit', (50% of my benefit?) and defer drawing her own full S/S until 66 or perhaps until 70,, assuming we should both live another 20 years ?

Posted by: Conway at 01/18/2010 06:25:32 PM

Mary Beth: Based on your article, here is what we are about to do in order to achieve our goal of maximizing our SS benefit for the long term: My retired wife will turn 62 in May 2010 and collect $752/mo, and deposit those checks into an interest bearing account. When I retire at 66, I will do the same while collecting $2295/mo. In 2018, when we both turn 70, we will file a Withdrawal of Benefits and use the account to pay back the sum of the checks. We can do this because we have plenty of dough now and well into our 80's. But we are concerned about having to fund 2 more decades of retirement. We know of and are willing to take the risks of early death or congress ending this withdrawal provision. Question: Is this the best way to maximize our long term benefit or should we look at file and suspend? Is there a way to somehow combine the two strategies to further maximize?

Posted by: Linda Vick at 01/19/2010 05:33:03 PM

I am 61 yrs old turning 62 this year. My ex-husband died, we were married 12 years, can I receive some of his benefits when I turn 62? he was remarried at the time of his death. I am receiving social security benefits at this time.

Posted by: Mary Beth Franklin at 01/20/2010 08:25:26 AM

To Linda Vick Hi, Mary Beth Franklin, author of this article, here. Normally, you can't begin collecting SS retirement benefits until age 62. However, widows/widowers call collect as early as age 60. So if you are 61 and already collecting SS benefits, I suspect those benefits are the survivor benefits from your ex-husband. As long as you were married at least 10 years (which you were) and you didn't remarry (even if he did), you are entitled to SS suvivor benefits based on his work record.

Posted by: Mary Beth Franklin at 01/20/2010 08:59:04 AM

To Conway, Your strategy of collecting SS benefits for your wife at 62 and you at 66 and saving the money in an interest-bearing account with the idea of repaying benefits when you are 70 years old is sound. And if you need the money in between, it will be available to you to use. As I said in the article, I can't guarantee that the ability to repay past benefits and restart them at an older age to cash in on bigger benefits will exist in the future, but if it does, you'll be in good shape to take advantage of it.

Posted by: Mary Beth Franklin at 01/20/2010 09:01:53 AM

To Tom Marquis, No, you're wife can't restrict her benefits to "spousal benefits onl"y at age 62. That option is only available to those who first apply for benefits at their normal retirement age--currently 66--or older. If she applies for SS benefits at 62, they will be based on the higher of her own benefits and/or her spousal benefits--reduced by 25% because she claimed benefits four years before her normal retirement age.

Posted by: Mary Beth Franklin at 01/20/2010 09:05:06 AM

To George, As you noted, you are 66 and your wife is 62. If she claims SS benefits now, you can claim "spousal benefits onl"y based on her work record and delay claiming your own until later when they will be worth more. But note, her benefits would be reduced by 25% because she claimed them four years ahead of her normal retirement age. And if she continues to work, it may not make sense because she's be subject to the earnings cap. That means she'll lose $1 in benefits for every $2 she earns over $14,160 in 2010.

Posted by: Mary Beth Franklin at 01/20/2010 09:08:04 AM

To Mike G, No. If your wife begins collect SS benefits at age 62, she cannot restrict them to "spousal benefits onl"y. That is an option only available to those who first claim benefits at their normal retirement age--currently 66--or older. If she claims at 62, her benefits will be based on her own work record and/or her spousal benefits based on your earnings. She will receive the higher of the two benefits, but they will be permanetly reduced by 25% because she claimed them four years ahead of her normal retirement date.

Posted by: Mary Beth Franklin at 01/20/2010 09:12:24 AM

To Ed Hoelker, I'm afraid it wouldn't make sense for your 86-year-old father to repay his SS benefits and restart benefits. The maximum SS benefit for those who delay collecting kicks in at age 70. There's no additional benefit for those who delay collecting benefits beyond 70. He would have to repay a massive amount of money for the benefits that he (and perhaps a spouse) collected over 21 years and probably would not live long enough to recoup that money.

Posted by: Mary Beth Franklin at 01/20/2010 09:16:16 AM

Under the circumstances, your husband may want to start collecting SS benefits now. Although it's admirable that he would want to postpone collecting benefits until they are worth more at an older age, sometimes that's not possible. He could start collecting benefits now, and if he founds another job, he could stop his benefits. Once he turns 65, he will be eligible for Medicare, whether or not he is collecting SS.

Posted by: Mary Beth Franklin at 01/20/2010 09:23:15 AM

To Janice Dial, If a parent dies, a minor child is entitled to SS benefits, usualy worth half of the parent's benefit, until age 18. But there is a maximum family benefit amount, so if there are two or more surviving children, each survivor may not receive the full benefit. However, when an older children turns 18 and loses the survivor benefit, the remaining child's benefit might increase, if it does not boost the family's total benefit above the maximum amount .

Posted by: Mary Beth Franklin at 01/20/2010 09:33:26 AM

To Sandi Jones, You say you're 62 and your husband is 58 and you're the higher earner. Assuming there is no change in SS rules by the time you turn 66, which is your normal retirement age, you could "file and suspend"--an option only available to those who first claim benefits at their normal retirement age or older. That means you could file for your own benefits, allowing your husband to claim spousal benefits based on your earnings record, and then immediately suspend your own benefits and delay collecting your benefits until age 70 when they would be worth more thanks to the delayed retirement credit worth 8% a year. At 70, your benefit would be worth 132% of what it would have been at your normal retirement age. Your husband's benefit at age 62 would be worth half of your full benefit (becuase you would be 66 at that time) MINUS 25% because he collected four years ahead of his normal retirement age.

Posted by: Mary Beth Franklin at 01/20/2010 09:38:51 AM

To Joe Reisman, regarding filing for a refund of taxes paid on past SS benefits when you execute a do-over strategy. You don't have to file an amended return. You can claim either a tax deduction or tax credit--whichever results in a bigger savings on the taxes paid on back benefits--in the year you repay your benefits. The calculations can be complicated, but it's all explained in IRS PUblication 915, Socail Security and Equivalent Railroad Benefits. Look for the section on repayment of benefits. If you've saved all your tax returns since you started collecting SS, you should be able to add up all the taxes you have paid on the taxable portion of your SS benefits over the years.

Posted by: Larry at 01/20/2010 05:36:51 PM

Similar circumstance, different twist. I will be 66, and my wife will be 62. She would like to take her SS benefits at 62 (25% penalty), and I would like to take spousal benefits at 66. In 4 years, we would like to switch: I take my SS benefits, and she take spousal benefits. Is my wife's benefits permanently reduced by 25%, or can she get the full 50% of my benefits?

Posted by: patricia a. lockwood at 01/21/2010 05:18:17 PM

I applied for S.S. at the age of 62, using my divorced husband's salary, since my salary was so low. I am now 77, with a much higher salary, yet my benefits have not increased. Am I still tied to his salary although- his S.S.benefits are now much higher than mine.

Posted by: JC at 01/26/2010 08:30:35 PM

Mary Beth - Nice article. Simple question: Here is the background for us: My wife is not working, but is eligible for SS benefits based on her own income record. She will turn 62 later this year. I am still working and plan to continue working until full retirement age, or longer. I believe that the best strategy for us would be for her to start SS benefits based on her own income when she is 62, and then when I retire at age 66 or later, she could then switch over to spousal benefits based on my SS benefit. (50% of my SS benefit would exceed her benefit that she would draw at age 62). Can you confirm that this would be the correct strategy for our situation, and has no downside? Thanks!

Posted by: Frank Decker at 01/26/2010 11:11:45 PM

Back in 2007 I made $4,000 to much so theyare taking $125 a month out of my SS check. Does anyone know if there is a way to get this sum reduced? It is a real hardship. Thank you.

Posted by: RAB at 01/31/2010 06:31:17 PM

My wife & I are both 63. She receives Social Security Disability. I am a fire fighter with 33 years on the Department. I plan to retire at age 64 with a pension, but not collect my Social Security till age 70. When my wife & I are 66 can I claim spousal benefits? In an earlier post you indicated "at 70 which will include four years worth of delayed retirement credits boosting your benefit to 132% of what it would have been at age 66". How will my Social Security be impacted in that manner since I won't be working for those 6 years?

Posted by: Tom at 02/05/2010 04:45:47 PM

When I turn 62, my daughter will be 10 years old and my son will be 12 years old. Will they be eligible to collect social security when I turn 62, even if I defer collecting for myself until I'm 67? Will they be eligible to collect if I continue working?

Posted by: Luisa at 02/10/2010 12:23:56 PM

I started collecting SS at 66 years and 10 months (full retiramente age) two years ago and still working but thinking of retiring soon, may work partime for a while. It will be worh to file the "Withdrwal", and refund the money? I have the funds to return it. Will I get the 7.5% increase? Next month I will turn 68. Do I need to wait until 70 years old to re-apply for SS or can do it sometime this year? In the "Request for Withdrawal of Application" in the "Important Notice" there is sentence that I am concerned, not sure what it really means, it said " You must then re-apply if you want a determination of your Social Security rights at any time in the future but any subsequent application may not involve the same retroactive period. (this meant if the person apply for second time?) and it said " This procedure is intended to be used only when your decision to file has resulted, or will result, in a disadvantage to you." (which wiil be the disadvantages?) Thanks for your advice. Luisa

Posted by: mary Conley at 02/12/2010 10:00:41 AM

I would like to know why i didn't draw more than too hundred and mabe 50 somewhat for so many years?...now 1 draw 500 and and so much cents. how come I dont draw enough to pay my debts without making my husband pay? .please explain please.

Posted by: yankeedam at 03/08/2010 10:02:45 PM

Mary Beth, you are amazing the way you keep answering these questions after over a year. The standard formula for "spousal benefits onl"y leaves one number out that I am curious about. A working wife (born 1944) applies at 66, based on her work record, for spousal benefits to her husband, who is 79. He will begin receiving 50% (or more?) of what her payment would have been at 66, and he will keep receiving that amount until she retires, let's say at 70. Her benefit will then start at quite a bit higher than the payment she didn't accept at 66. BUT when she starts receiving those higher benefits, will her husband start receiving some higher amount like 50% of it, or is he stuck for life at a lower amount of spousal benefit? (Assume he has no work history from SSA's viewpoint.) I have looked everywhere for law or discussion answering this, but no luck. Thanks again.

Posted by: Carol at 03/09/2010 02:19:40 PM

Help! I am a widow working full time and will be 66, (my age to collect supposedly without penalties). I understand I can collect either my husband's or my own social security. I understand that it is also taxable and is based on what I make a year, is that correct??

Posted by: Kiki at 03/09/2010 11:11:44 PM

My ex-husband, to whom I was married more than 10 years, received early SS benefits and is now 76 years old. I am 66 and just recently repaid the early benefits I received and applied for my spousal benefits. Am I due one half of his reduced benefits or one half of what his benefits would have been at 65?

Posted by: yankeedam at 03/09/2010 11:39:38 PM

Hi, starting to answer my own question: The high earner in the family applies for (and suspends) benefits when reaching "full retirement age," in this case 66. This high earner has a "primary insurance amount" (PIA) that is what he/she would receive monthly at 66 if NOT suspending benefits (whether applying at 66 or 70 or over 70, but not at under 66 (not allowed for triggering spousal benefits)). When the low-earning spouse co-applies for those spousal benefits to start now, those benefits begin at, and always stay at, 50% (less if the spouse is under 66 when starting, but NOT more if the spouse is over 66) of the high earner's PIA, which is written in stone at age 66 and will never change. Later, when the high earner applies (at 70, hopefully) to have benefits start, he/she will get a fatter monthly benefit, but the spouse will continue receiving spousal benefits at the same old amount, no change, until a death in the family changes the whole benefits picture.

Posted by: jim t at 04/14/2010 12:26:59 AM

hey guys you know what. if you have the money and you can guarantee you're in great health and have lots money to repay. don't do it...you don't know what emergencies will come up during the time you paying uncle sam back. best way i know . is when you're young like this 22 year old. start a 401k and when its time to retire you got your duckets....

Posted by: Sharon at 04/23/2010 09:31:22 AM

Hi. Both my husband and I are retiring. He's 66. I'm 62. My current salary is higher, but I did take off some years to care for our kids, so I'm not sure who's PIA will be higher. We were both planning to start collecting SS benefits now, but I'm wondering if we would be better off if my husband started collecting a spousal benefit now and let his grow until he's 70?

Posted by: pat at 04/26/2010 02:57:06 PM

Thanks to 22-year old Jim. Your comment that you don't know what emergencies will come up (for which presumably one might need that repayment money) was very helpful to me. It's an important consideration.

Posted by: Richard Carli at 04/26/2010 03:48:39 PM

I have heard of this before and am about to look into it more closely. One thing I never hear mentioned is that if you are collecting SS benefits at age 62 and paying taxes on them then it seems the tax can't be refunded and you would pay twice once beginning at age 62 and then again beginning at age 66 or 70 if you decided to pay back your social security proceeds and defer them to a later date. Can someone explain how that tax issue would have to be figured into the decision?

Posted by: gary at 04/28/2010 05:21:24 PM

I do not have a very good understanding of the SS law as it pertains to the pay back option and dependent children. I an 65 and I have an eight year old child, my wife is 43. I had no idea the dependent child supplement existed until I went in to initiate Medicare last summer, I was not quite 65 at the time. I was not even going to sign up for SS until I found out about the child portion and then it seemed foolish not to enroll in SS. My questions are: Regarding my child, can I obtain back pay for the years back to when I turned 62? If I do a payback of my benefits, can I still collect for my child? Is there a window for the redo option ie; my age etc.?... Thank you for your article and the interim information. Gary

Posted by: Phil at 05/27/2010 10:11:40 AM

Mary Beth - I'm wondering if you've heard of any real life experiences of the strategy relating to repaying the benefits and re-applying at a higher monthly level. I'm working with an individual who started to collect at 62 and has repaid benefits just after age 70. He will re-start at the max benefit as if he started at 70. The problem is he repaid the benefits back in January 2010 and the check was cashed by Treasury. Four months later he has not received confirmation that he has repaid completely, and thus he can't restart the higher benefit. The local SSA office doesn't appear to even know what is going on; he has talked to multiple people in the field office. Finally, he now has engaged his US Congressman to expediate the processing....... any thoughts or practical advice?

Posted by: R.S. at 06/16/2010 05:36:37 PM

When taking early retirement, I know that if you continue to work your SS benefits will be reduced. If self employed, I know that you must report your net earning. What do those earning include? Are such things as 401K benefits, expenses, housing allotment, etc. part of qualified deductions to arrive at a net earnings amount?

Posted by: Paul at 06/24/2010 08:28:13 PM

Request some amplification on the statement: "Then, when the primary breadwinner dies, the spouse with the lower benefit will "step up" to a much higher survivor benefit as the smaller retirement payment drops off." If the lower earning spouse starts collecting at 62 while the primary breadwinner continues to work, does it impact at all what rate would be paid once the primary breadwinner dies (or is that purely a function of the age and earnings of the primary bread winner)? Meaning is the higher survivor benefit discounted in any way because the spouse started collecting his/her SS benefits at age 62?

Posted by: Bob Halvin at 06/24/2010 08:57:26 PM

The SS program is the world's largest Ponsi scheme. For all the chumps out there that own a business like me and have to pay both sides of SS (13% of gross income), if I could put away that 13% of my income every year I wouldn't need SS in the future. If you were greedy enough to start collecting at the age of 62 then you should live with that dissession, NO do overs. I would like the same ability to optout of SS like the teachers and state employees of California. They pay 8% into their retirement fund and receive 60% of their highest annual income after 30 years and can retire at age of 60. Free money isn't free. When you steel from Peter to pay Paul, Paul will aways vote for more Government.

Posted by: Chis at 07/08/2010 01:58:27 AM

Michael has it right. The actuaries already know that a little less than half of the workers who paid a portion of their labor into the Social Security system their entire working life will ever see any of it come back to them in the form of an old age retirement pension. My sister's husband worked full time for 38 years supporting his family as a sheriff's deputy, making a pretty skimpy salary. He paid Soc Security payroll tax throughout all his working years. He died at age 61 and 9 months, not having collected any social security at all. His wife was 11 years younger and recieved no widows pension because he died before he was old enough to qualify. Many more millions die waiting to get to 66, therefore, collecting nothing. Consider the multi millions who pay in their whole lives, and die before they see a dime of their wages come back to them. Don't worry about "the system", Mathematics has already told the government how many will be left at age 70, 66, or 62. As a matter of fact, most people don't know that there is no Social Security trust fund: The money deducted from the pay checks of workers goes directly into the general treasury of the united states to be squandered immediately. They put as little back as they have to just to make it look like they fulfilled their part of the Soc Sec agreement. Your pay roll deductions are not stored away by the government for your future retirement. They already know 44% won't be alive to see a dime of it back. The system has plenty of share with dependent children of workers and disabled. The government spends 5 more on foreign aid than they do paying back American Workers who paid in. None of those foreign aid recipients paid anything into the system either.

Posted by: richard at 07/19/2010 01:31:00 AM

I started collecting ss at 65 and 7 months in 2006 and have continued to work until 2010, and will retire at the end of July. My wife started collecting ss at 62 three years ago and will turn 65 in July. I figure that she has received about 43000 in those three years from ss. We could pay that back to ss, but how would that effect her medicare and our taxes and her payments from ss? Also, can a ss agent advise us on this or do we need to hire an attorney?

Posted by: Rose Jones at 07/21/2010 03:06:41 PM

I missed collecting credits towards my SS for several years when my wages did not reach the required ceiling. (I was in real estate). Can I elect to pay for those credits now that I am nearing retirement age to ensure that I can collect SS benefits?

Posted by: MER at 08/07/2010 08:21:52 PM

This is a great article. But are there any information sites explaining how ,when and what benefits are available to Widows? The rules of when widows can claim benefits and/or if they can keep working while claiming benefits? I have looked everywhere and found nothing .

Posted by: Roslyn B. at 08/26/2010 02:02:42 PM

I am currently on SS Disability and I was curious about something. What happens once I reach the age of 66, regarding standard SS benefits? I was told my benefits check solely under my earnings would not change. Is this correct? It seems wrong somehow.

Posted by: mary louise at 09/08/2010 06:50:27 PM

I am retired and collecting amt of ss earned previous to working for a railroad. which was combined with my railroad retirement. No part of my husbands social security was included. Did i miss out by not receiving any amount from his social security?

Posted by: Lois at 09/15/2010 09:37:38 AM

Mary Louise, I think the answer to your question depends on whether or not one-half of the amount you could get on your husband's SS record is greater than the amount you are receiving on your own accounts(both SS and railroad). Hope this helps.

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