How do I Apply for Social Security Benefits?

You’ve worked hard, met with your financial advisor, determined when to take Social Security and you are set to retire… now what? Many retirees get to this point and are not sure what the next steps are when applying for Social Security. Thankfully, you have three options!

  1. Online: Prefer to handle things on your own? Today, it’s easier than ever to apply for Social Security by applying online. Visit their website to get the process started. If you don’t finish the application, they make it convenient by allowing you to return and finish the application later.
  2. By Phone: Not savvy with the computer? You can also call Monday through Friday from 7:00 a.m. to 7:00 p.m. at 1-800-772-1213 to speak with a representative and apply for your benefit.
  3. In Person: Prefer to handle things face to face? You can visit your local Social Security office to apply for your benefit. Please visit their office locator to find the office closest to you.  I’d recommend either calling to set up an appointment, or getting there early. Like the DMV, you may end up waiting a while!

It’s important to be prepared when starting the application process for your benefit. Below are some of the items that you may need to be prepared to provide when applying.

  • Birth Certificate – this needs to be an original certificate or one certified by an issuing agency. They will not accept a photo copy.
  • Proof of citizenship or lawful alien status.
  • Copies of W-2 forms and/or self-employment tax return for the previous year.

If you don’t have all the appropriate documents, don’t let that stop you from applying.  The Social Security office will take what you have, allowing you time to collect the other documents.  Any original documents that you have provided will be returned to you once you have completed the application process.  If you don’t know how to get all the documents required, I recommend speaking with a representative at your local office.  They can help point you in the right direction.

It’s important to note that the Social Security Office recommends that you apply for benefits at least three months prior to the date you wish to start receiving your benefit.  The earliest you can sign up for your benefit is 61 years and 9 months of age.

If you are nearing retirement, and would like to determine the best time start receiving your benefit, please call your financial advisor to discuss. We are here to help!

Ashley Gragtmans, CFP®

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Important Changes to your Social Security Benefit

In October, President Obama and the US Congress passed the Bipartisan Budget Act of 2015.  Included in that act was a clause that eliminated two popular Social Security claiming strategies: File-and-Suspend and Restricted Application.

File-and-Suspend:  A strategy where a person, who is at least full retirement age, files for social security benefits, but then immediately requests to suspend those benefits. This allows his/her spouse to take a spousal benefit on the filer’s record, while the filer’s benefits are delayed and continue to grow.

Restricted Application:  A strategy where a person, who is at least full retirement age, files for spousal social security benefits and delays his/her own benefit so it continues to grow. This allows the filer to receive some benefit now (the spousal benefit), and a larger benefit later.

Delaying your benefit pays off big. When you delay your benefit you earn delayed retirement credits, which equate to an annual 8% increase in benefits.

Those born before April 30, 1950 were grandfathered in to the old rules and may continue to use File and Suspend and Restricted Application strategies while delaying their credits. Please note, if you were born before April 30, 1950 and you wish to implement the File and Suspend Strategy, you must submit your application before April 29, 2016.

Those born after April 30, 1950 or on or before January 1, 1954 (age 62 in 2015) may only use the Restricted Application strategy.   If your spouse is receiving benefits and you have reached full retirement age, you may apply for a spousal benefit, while allowing your own benefit to accrue Delayed Retirement Credits.

For those born after January 1, 1954, neither strategy is available.  However, you may still choose to delay taking your benefits until age 70.  By doing so, you stand to increase your future benefits by 32%.

Please note that if you are already drawing Social Security, or if you have already set up File and Suspend, the new laws do not affect you.

Summary of Available Strategies

Age Can Participate Cannot Participate
66  by 04/30/2016 File & Suspend /Restricted Application
62 by January 1, 2016 Restricted Application File & Suspend
62 by January 2, 2016 File & Suspend /Restricted Application

There are many factors to consider when determining when to start taking Social Security.  We recommend that you meet with your financial advisor for guidance to help you with that decision.  And if you were born before April 30, 1950, please remember the April 29, 2016 deadline.

Tracy Allen, CFP®
Financial Advisor
Tracy Allen
Tracy Allen
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