There have been a lot of changes to Social Security this year. It might be beneficial for you to set up an appointment to go over which strategy is best suitable for you.
The Bipartisan Budget Bill 2015 has created changes to Social Security, which may or may not impact you. We are waiting for all of the details of the bill to develop and evaluating which of our clients may or may not be affected. Some language in the rules needs to be clarified and the procedures and policies at the Social Security Administration need to be changed to reflect the new laws. However, here is our understanding on the newly passed rules:
-Starting 6 months after the bill was passed, you will not be able to “file and suspend” your benefits. If a worker’s benefit is suspended, benefits based on the worker’s earnings record will no longer be paid to any spouse or dependent.
-If you have already claimed benefits using the file and suspend strategy, you will be “grandfathered” and may continue receiving benefits as they currently are. Any benefits being paid on the earnings of a worker who has suspended benefits will continue.
-If you execute a file and suspend strategy within 6 months of the passing of the bill, you can continue with the benefit claiming strategy, and spouses that are being paid from the suspended benefits of a worker will continue.
-If you will have turned age 62 by the beginning of 2016, you may still select the option of filing a “restricted application” at Full Retirement Age. This will let you to claim a spousal benefit while your own benefit accrues delayed retirement credits. It will allow you to switch to your own higher benefit later down the road. However, you can only receive the spousal benefit if the worker is receiving a benefit payment. If they have suspended their benefit, the spousal benefit is not available.
-If you will turn age 62 after 2015, you will not be allowed to use the restricted application strategy at Full Retirement Age. If you apply for any benefit, the application will be considered an application for all eligible benefits, and the payment will be essentially equal to the highest benefit.
We are still unsure how divorced spouse benefits will be considered after these changes. We will continue to keep you up-to-date with the changes and interpretations of the bill.
To find if any of these changes may affect you, or if you want to learn more about your options, set up an appointment with a financial planning professional by calling 952-657-7470 or email email@example.com.
If you have any questions about retirement in Minneapolis feel free to come pay us a visit!
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