smart ways to get more social security income
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Smart Ways to Get More Social Security Income. Your Name, Your Pic 111.111.1111 (office) [email protected] www.xyzadvisor.com. Choose Your Income Election Wisely!. Choose wisely Hundred’s of combinations More important than ever. Your Name, Your Pic Advisor. - PowerPoint PPT PresentationTRANSCRIPT
When To Take Social Security 1
Smart Ways to Get More Social Security Income
• Your Name, Your Pic• 111.111.1111 (office)• [email protected]• www.xyzadvisor.com
When To Take Social Security
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Choose Your Income Election Wisely!
• Choose wisely• Hundred’s of combinations• More important than ever
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Your Name, Your Pic Advisor
NOTE: This Presentation is not endorsed by Social Security Administration, nor are we affiliated with Social Security
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What you will learn…
• When filing for social security, do it right the first time
• 6 strategies for more income
• Your best-fit claiming method
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Basics…
• The “Octopus”
• Terms
• Solvency
• Benefit calculation
• Life expectancy
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The Octopus
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Assumptions & Terms
• Rules, case studies presented herein apply to those of us born between 1943 - 1954
• SS - Social Security• FRA - Full Retirement Age, age 66.
You get 100% of PIA• PIA – Primary Insurance Amount,
monthly SS income if begun at FRA
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Assumptions & Terms
• COLA – Cost of Living Adjustments• Primary Wage Earner - Spouse with
higher PIA• Secondary Wage Earner - Spouse
with lower PIA• LE - Life Expectancy
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IS IT SOLVENT?
Social Security Trust Fund
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How is Income Calculated?
• SS takes your highest 35 years earnings (zeros included) and applies wage index factor to adjust forward and translates to current dollars
• The sum of these index adjusted earnings are divided by the total months (12 X 35=420) which generates your AIME (Averaged Index Monthly Earnings)
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How is Income Calculated?
90% of first $816 = $73432% of the next $4,101 = $1,31215% of amount over $4,917 = $162PIA = $2,208
For example, if your AIME is $6,000, your PIA is:
2014 bend point formula
When To Take Social Security
Life Expectancy
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Life Expectancy Statistics
Age-80: per 1000 females born in 1927, 620 remain
Source: Social Security, Actuarial Publications, 2007 Period Life Table
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Six Strategies
• Claim & get it right the first time• Don’t elect too early• If married, use your living
spousal income benefit
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Six Strategies
• If married, leverage the survivor benefit income stream
• Compute your optimal benefit• Align your election strategy with
your overall portfolio
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Strategy #1: Claim Correctly the 1st Time
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Strategy #2: Don’t Elect too Early
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Strategy #2: Don’t Elect too Early
Claimant Age Benefit Amount % of PIA Claiming Zone
Benefit Adjusted 2.8%
for Inflation
62 1725 75Actuarial
Reduction “Penalty Zone”
1725
63 1840 80 1891
64 2001 87 2114
65 2139 93 2323
66 2300 100 PIA Income Amount 2568
67 2484 108Delayed
Retirement Credits
“Bonus Zone”
2851
68 2668 116 3148
69 2852 124 3460
70 3036 132 3786
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Strategy #2: Don’t Elect too Early
• Monthly benefit by age, adjusted for inflation
62 66 70
- Wait to claim, with inflation
- Wait to claim, no inflation
When To Take Social Security
Strategy #2: Don’t Elect too Early
Life Expectancy:50% Chance of Living to . . .
Cu
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Inco
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85
Women88
One of a Couple92
Break Even
79
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Strategy #2: Don’t Elect too Early
• Social Security best-fit discussion• Consider life expectancy, single,
married, needs…
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Strategy #3: Spousal Income Benefit
Harness the powerof little-known
spousal incomebenefit
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Strategy #3: Spousal Income Benefit
Spousal Benefit =½ your spouse’s PIA at your FRA
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Strategy #3: Spousal Income Benefit
John’s PIA =Jane’s PIA =
Jane’s spousal benefit at FRA =
$2200$ 300$1100
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Strategy #3: Spousal Income Benefit
Spousal Income Benefit Rules…
• Spouse at FRA gets 50% of other spouse’s PIA
• Benefit reduced pro-rata, between 62 & 66
(35% at age 62)
• One spouse must claim (or file and suspend @ FRA)
for other spouse to collect
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Strategy #4: Survivor Income Benefit
Plan for your surviving Partner’s income stream
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Strategy #4: Survivor Income Benefit
Jim & Linda Heartland
$2,300$300
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Strategy #4: Survivor Income Benefit
$2,300
Jim passes on… Linda gets…
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Strategy #4: Survivor Income Benefit
Jim dies at 77 and Linda collects for 16 years to age 93
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Strategy #5: Compute Your Optimal Benefit
Compute your optimal benefit with our social security maximization software
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Strategy #5: Compute Your Optimal Benefit
Timing…
• PIA• Life expectancy• Relationship history,• Financials
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Strategy #5: Compute Your Optimal Benefit
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Strategy #5: Compute Your Optimal Benefit
www.ssa.gov
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Case Study 2:The Heartlands
“File and Suspend”
Case Study 1:The Metros
“Claim Some Now, More Later”
Strategy #5: Compute Your Optimal Benefit
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Case Study 1: The Metros
Bob Metro age 63 (LE = 82)
Secondary Earner------------------------------------------
PIA $2,000
Mary Metro age 61 (LE = 86)
Primary Earner------------------------------------------
PIA $2,200
Strategy #5: Compute Your Optimal Benefit
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Claims age 68$2307 for life(Bob’s PIA = $2000)
Collects $1000 between 66-70,Full benefit at 70$2904 for life
Case Study 1: The Metros
Strategy #5: Compute Your Optimal Benefit
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Case Study 1: The Metros
Strategy #5: Compute Your Optimal Benefit
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Case Study 2: The Heartlands
Jim Heartland
age 66(LE = 77)
Primary Earner------------------------------------------
PIA $2,300
Linda Heartland
age 61 (LE = 93)
Secondary Earner------------------------------------------
PIA$300
Strategy #5: Compute Your Optimal Benefit
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Age 66, files and suspendsAge 70, collects $3,036 for life...Age 77, dies
Case Study 2: The Heartlands
Strategy #5: Compute Your Optimal Benefit
Age 63, collects $825After Jim dies...Ages 73-92, Collects $3,036
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Strategy #5: Compute Your Optimal BenefitCase Study #2: The Heartlands
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Strategy #5: Compute Your Optimal Benefit
Case 3a: Sally Solo, Single
Sally Solo age 60 (LE = 88)
PIA $1,600
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Strategy #5: Compute Your Optimal Benefit
When To Take Social Security
Strategy #5: Compute Your Optimal Benefit
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How Sally Single Maximizes Her Social Security Income
LE = age 88, age 70 = $481,536, age 62 = $376,584
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Strategy #5: Compute Your Optimal Benefit
Case 3b: Sally Divorced
• Married > 10 years
• Ex-husband PIA = $2,000
• Takes ex-spousal income benefit then switches to own
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Strategy #5: Compute Your Optimal Benefit
$1,000 monthlyex-spousal income
Switch to own benefit at 70
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Strategy #5: Compute Your Optimal Benefit
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Strategy #5: Compute Your Optimal Benefit
Case 3c: Sally Widowed
• Married > 9 months
• Deceased husband’s PIA = $2,000
• Takes survivor benefit then switches to own
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Strategy #5: Sally PIA = $1,600deceased spouse PIA = $2,000
Switch to own benefit at 70
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Strategy #5: Compute Your Optimal Benefit
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Strategy #5: Compute Your Optimal Benefit
•Sally Single•Sally Divorced•Sally Widowed
Case 3 Summary
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Strategy #5: Compute Your Optimal Benefit
$376,584
$481,536
$529,536
$653,136
$350,000
$400,000
$450,000
$500,000
$550,000
$600,000
$650,000
$700,000
Total
Life
time
Bene
fit
Sally Solo Income Benefit ScenariosSally PIA = $1,600 Husband’s PIA = $2,000
Sally Single, Age 62
Sally Single, Age 70
Sally Divorced, 66 SP, 70Own
Sally Widowed, 60 Survivor,70 Own
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Strategy #6: Align Your Election Strategy
Align yourelection strategy
with youroverall portfolio
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Strategy #6: Align Your Election Strategy
• Income• Investment accounts• 401(k)• IRA• Life insurance• Annuities
When To Take Social Security
Strategy #6: Align Your Election Strategy
INTELLIGENCE OF DECISIONSocial Security Choice Asset Placement Sequence of Withdrawal
% R
ise
in S
tan
dar
d o
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ivin
g
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Strategy #6: Align Your Election Strategy
Optimize Your Retirement Income With The Best Social
Security Income Strategy
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Summary
•We teach you how to file correctly so you can gain $100,000 or more in social security income
•We work with you one-on-one and run our social security maximization report to generate the best strategy for income
•Use the 6 strategies you’ve learned today
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Next Steps
Personalized One-HourSocial Security and
Retirement Check-Up
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Next Steps
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John/Jane Smith, Advisor 111 Main StreetCity, State111.111.1111 (office tel)[email protected]
www.xyzfinancial.com
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