Will I nonetheless obtain late retirement financial savings for social safety for 2020?


Economic Security Planning, Inc.

Today’s column addresses questions about when and if Late Retirement Credits (DRCs) are applied to benefit rates, the eligibility of exes to claim benefits on an individual’s Social Security record, and pensions based on work not done by the Social Security will be taxed. Larry Kotlikoff is Professor of Economics at Boston University and the Founder and President of Economic Security Planning, Inc., which markets Maximize My Social Security and MaxiFi Planner.

You can find more Ask Larry answers here.

Do you have any questions of your own about social security that you would like to have answered? Ask Larry about Social Security here.

Will I still receive late retirement savings for social security for 2020?

Hello Larry, I’ll be 70 years old later in December. I still work full time. I will be applying for my social security pension soon. Will I still get the credits for not submitting them until the end of 2020? My account on the Social Security website says I’m eligible for $ 2,900 per month, but I’m trying to get it to $ 3,000 or more. Is that still possible? Thank you, Rebekka

Hi Rebekah, yes, unless you choose to start your benefits earlier than the month you turn 70, your Social Security rate will include four full years of late retirement credits (DRC). This means that your benefit rate is 32% higher than your primary insurance amount (PIA). Your PIA corresponds to the benefit rate that you would receive if you had received your benefits at full retirement age (FRA).

If your 2020 income is high enough to be among your top 35 years of insurable wage-indexed income, your benefit rate may be recalculated to include the income that takes effect with your benefit payment for January 2021. If you hit 70 by December you won’t want to wait longer than this month to claim your Social Security pension as it would not increase your benefit rate. Best of all, Larry

Will my ex-spouse ever be eligible for my social security benefits?

Hi Larry, a former spouse is collecting a Social Security Disability under his own name. He’s been collecting it for years. We were married for 10.5 years before I divorced him. I’ve always worked and paid social security taxes, but not him. It was a bad relationship that lasted 10 years. If I pay my Social Security Pension at age 62, will he ever be eligible for my Social Security benefits? Thanks Jenn

Hi Jenn, your ex could never get your actual Social Security benefits, but if you are both at least 62 years old and unmarried, he could potentially be eligible for divorced spouse benefits from your file. However, he could only qualify if your Primary Insurance Amount (PIA) is more than double his own PIA. A person’s PIA equals their Social Security Rate when they receive their benefits at full Retirement Age (FRA) or their Full Social Security Disability Rate (SSDI).

Even if your ex is able to receive benefits from your record, it would not have any adverse effect on your benefit rate or the benefit rate (s) of other people receiving benefits based on your income.

If you die before your ex, he may be eligible for survivor benefits from your account if your full benefit rate is higher than his own rate. However, even this would not affect other survivors who would benefit from your file. Best of all, Larry

Can my Social Security pension be reduced if I am getting pensions for work I was doing before I arrived in the United States?

Hello Larry, I came to the US 25 years ago after marrying an American. I was receiving pensions from employment before I was either a green card holder or a US citizen Can this reduce my social security pension? Thank you, Herman

Hi Herman, yes, if you are receiving a pension based on your work and income that is exempt from US Social Security taxes, your Social Security pension may decrease due to the Windfall Elimination Commission (WEP).

My company’s software – Maximize My Social Security or MaxiFi Planner – is programmed to process WEP calculations. Hence, you should consider the software to learn more about your options and to find the best strategy to maximize your benefits. While this doesn’t seem to be the case in your case, the software also fully accounts for the Government Pension Offset (GPO). Social security calculators provided by other companies or non-profit organizations can provide suitable suggestions if they have been carefully prepared. Best of all, Larry

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