Navigating the Social Security Retirement System with Cynthia Gibson, CFP Cynthia Gibson, Certified Financial Planner
Social Security can be a complicated system to navigate, especially because the rules differ so much from person to person. Depending on your own personal circumstances such as where you live, what kind of job you have, and if you have a spouse that is working, there are different requirements for claiming Social Security benefits. In today’s episode host Liz Smith is joined in conversation with Cynthia Gibson, Certified Financial Planner and Owner of Wayfinder Wealth, to discuss in detail how to navigate the Social Security retirement system. Typically it is best to wait until your full retirement age to begin taking Social Security benefits. Your retirement age is based on the year of your birth and is the age at which you qualify for your full benefit amount. You can technically start receiving benefits early at age 62, but then you are reducing the amount you could have received had you waited. Likewise, if you put off taking your benefit, it will grow over time. Depending on your career, you may be ineligible for benefits. Jobs such as teachers and most employees for the state of Alaska, generally do not pay into Social Security. In Alaska, there are additional provisions in place such as the Government Pension Offset and the Windfall Elimination Provision that must be considered in certain cases, adding another layer of complication to navigating the system. The best rule of thumb is to keep asking questions because the rules change as you age and as your circumstances change. Tune into this week’s episode of What’s Next to learn more about how to best navigate the Social Security system. Learn about spouse survivor benefits, the pros and cons of waiting until a certain age to begin receiving benefits, and how the system differs in Alaska versus other states. Quotes • “Here's the Social Security rules. The rules change from your full retirement age. Your full retirement age is the magic age where once you hit that almost anything is possible for you. So that full retirement age is based on your year of birth. So if you're born anywhere between 1954 and 1960, is going to be 66, 66 and two months, 66 and four months, they step it up. So whatever your full retirement age, you figure that out for yourself. And you know that the rules before you turn your full retirement age are going to be different than that year that you turn your full retirement age, and then they're going to change again after that birth month. So say you turn full retirement age, June of 2022. Well, now, you're free and clear, almost anything goes.” (16:16-17:09 | Cynthia) • “Once you hit your full retirement age, then you get the full amount that's stated on your statement. And if you want to delay, you can delay and you're going to get more out of that benefit.” (18:59-19:12 | Cynthia) • “General rule of thumb is if you can't work for a variety of reasons, but you're not disabled, and you need the cash flow, then generally people are taking it earlier. They're not working. Even though most of the literature is going to encourage you, especially from Social Security to delay till age 70.” (21:17-21:50 | Cynthia) • “If you wait till 70, you're giving up all those years of not taking it. Right? So that could be, say you're giving up $2,500 a month, that's 30,000 a year for three years, that's $90,000 that you're giving up. So to break even you've got to at least make it to 80 and there are many people that don't live that long.” (24:04-24:25 | Cynthia) • “It's always important to ask. Just keep going back and asking questions. Don't just take what somebody tells you, not even Social Security.” (29:16-29:26 | Cynthia) • “People forget that the rules change. Remember that once you turn your full retirement age, you can make as much money as you want. And in the calendar year in which you turn your full retirement age, whatever month that is, up until that month, you can make more than double what the other number is.” (36:54-37:18 | C