Surgent's When to Start Taking Social Security Benefits

 

   

 

 
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Overview

2.0 Credits

An individual can begin receiving Social Security benefits as early as age 62 or as late as age 70. The later someone starts, the higher the level of benefits. Most individuals apply for Social Security benefits before attaining Full Retirement Age (FRA), which is age 65 for people born before 1938. Some people begin benefits as soon as they retire because they do not have sufficient income from sources other than Social Security (such as IRA and 401(k) distributions) to support their lifestyle. However, many people can choose to delay the beginning of benefits. For these individuals, the question is: Is it worth the delay in receiving benefits to receive a higher monthly payment? This course presents strategies to maximize the present value of expected benefits and identifies factors that should influence this decision. The analysis for singles is relatively simple, while for married couples it becomes more complex.

Objectives

  • Summarize Social Security retirement benefits
  • Describe the factors affecting singles' decisions as to when to start including actuarial and tax factors and the factors affecting couples' decisions as to when to start including spousal benefits and survivor's benefits
  • Evaluate scenarios involving differing ages and differing spousal benefits levels as well as switching strategies involving survivor's benefits
  • Present an analysis of normal, delayed, or early start including actuarial issues, investment issues, inflation issues, the effects of early retirement on benefit levels, as well as the impact of taxes
  • Explain the implications of the Social Security election for conversion planning
  • Describe the rules for withdrawing an application for Social Security and deferring the start of benefit payments and explain when such an election might be appropriate

Major Topics

  • Summary of Social Security retirement benefits
  • Factors affecting singles' decisions as to when to start including actuarial and tax factors
  • Factors affecting couples' decisions as to when to start including spousal benefits and survivor's benefits
  • Scenarios involving differing ages and differing spousal benefits levels as well as switching strategies involving survivor's benefits
  • Analysis of normal, delayed, or early start including actuarial issues, investment issues, inflation issues, the effects of early retirement on benefit levels, as well as the impact of taxes
  • Implications of the Social Security election for conversion planning
  • Rules for reapplying for Social Security - starting over - and the effects using a case study

Designed For

All CPAs in public practice who consult with individual clients, and anyone who works in financial planning or advises clients regarding investments and retirement issues.
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