This Social Security Administration celebrates "my Social Security Week" this week, to raise consumer awareness of the benefits of having an online social security account. But Wayne Titus, CPA, PFS, AIFA®, founding member of AMDG Financial, says setting up an account is just the first step in creating a social security strategy.
This week, the U.S. Social Security Administration is encouraging Americans to become more engaged in their retirement planning by creating an online account to track their social security eligibility. It’s also a good time to consider creating a personal social security strategy, says Wayne Titus of AMDG Financial. “Many Americans know they can file for social security benefits as early as age 62, and some may choose to wait until they can claim higher benefits at age 65 or 70. But there’s no ‘one-size-fits-all’ approach,” says Titus. “Personal situations make a huge difference in how and when a person should claim benefits.”
Titus recently worked with a couple who expected to file for benefits immediately, but changed their minds when they saw how much money they were potentially leaving on the table. “I was able to show them that by waiting five years and filing strategically, they could earn an additional $743,000 in benefits over time,” says Titus. “Start ages and filing methods can dramatically change the level of benefits couples receive, and could also have significant tax implications,” he adds.
Titus encourages couples to examine multiple scenarios and ask questions when developing a strategy, like:
* At what age should I file for benefits?
* At what age should my spouse file for benefits?
* When does it make sense to claim a spousal benefit?
* How can I make sure my spouse gets the largest survivor benefit?
* How do we know which of the common filing methods is best for us?
* If one of us lives a long life, how does that affect our decision?
The Social Security Administration can provide information, but not advice, so Titus encourages individuals and couples to seek the help of a professional financial adviser to explore all of the possibilities and develop a strategy. “This is one of the biggest decisions people can make in their retirement planning,” says Titus, “so it’s important to understand how it can affect their future wellbeing.”