Chapter 3 - “Social Security‪”‬ Control Your Retirement Destiny

In this episode, podcast host and author of “Control Your Retirement Destiny” covers Chapter 3 of the 2nd edition of the book titled, “Social Security.”
If you want to learn even more than what there is time to cover in the podcast series, you can find the book “Control Your Retirement Destiny” on Amazon.
Or, if you are looking for a customized plan for your retirement, visit us at sensiblemoney.com to see how we can help.
 
Chapter 3 – Podcast Script
Hi, this is Dana Anspach, the founder and CEO of Sensible Money, a fee-only financial planning firm. I’m also the author of the books Control Your Retirement Destiny and Social Security Sense. CYRD was initially published in 2013, and the 2nd edition came out in 2016.
Why a 2nd edition? Well in Nov. 2015, some of the Social Security laws changed. The 2nd edition incorporates all these changes. The good news is that in this podcast, where we cover Chapter 3 on Social Security, everything we’ll talk about uses current rules.
And, even better news, the book has incredible 5-stars reviews on Amazon. If you like what you hear today, go to Amazon and search for Control Your Retirement Destiny. And if you are looking for a customized plan, visit sensiblemoney.com to see how we can help.
Ok, let’s get started. In this podcast, I’ll be covering the highlights from Chapter 3 on the topic of “Social Security.”
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I never set out to be an expert on Social Security. So how did it happen? From 2008 to 2017, I wrote an online advice column called MoneyOver55. My most popular topic was Social Security. I had so much content online on this topic that email questions came pouring in, not only from consumers but also from other financial professionals.
To this day, many of my colleagues call or email me with Social Security questions. While I was working on revising this chapter for the 2nd Edition of this book, I received one of those calls. It was from a friend of mine, a financial planner in Colorado.
She had a client, whom we’ll call Diane. Diane is a widow. Her husband, Paul, had passed away at 57.
Diane is now age 62. She is no longer working - but she had worked for most of her life. Here’s how SS works for Diane.
She is eligible for either her own Social Security retirement benefit, or a survivor benefit, which will be based on her deceased husband Paul’s work record.
Diane wasn’t exactly sure how it all worked, but she heard that she could collect a survivor benefit as early as age 60. Naturally, at 60 she went to the Social Security office to learn more. They told her she could collect this survivor benefit now, but that she would get more if she waited until age 62. Technically this was true.
Just before her 62nd birthday she went back to her local Social Security office. They told her now that she was 62 she could collect her own retirement benefit amount, which would be $1,791 a month. But they also said if she waited until 66 she could collect a widow benefit based on Paul’s Social Security, which would be $2,706 per month.  (This higher widow benefit is based on the amount Paul would have received if he had lived and filed at his age 66). Technically this information they provided to her was also true.
So, what was the problem with this information given to Diane?
If Diane decides not to do anything and to wait and claim a widow benefit at her age 66, she will forfeit up to $200,0000 that she can get over her lifetime.  This $200,000 is measured in today’s dollars.
$200,000!
How can she get so much more?
There are claiming strategies that the workers at the local Social Security office were not aware of. It’s not their fault. It takes years to understand all the claiming choices available - and this is not what your Social Security office worker is trained to do.
So what can Diane do to get $200,000 more?
Well, normally when you file for Social Security benefits you are deemed to be filing for all benefits you are eligible