Social
Security Administration
Monthly
Information Package
August
2004
Columns
1. Annual Social Security Statements Help You
Plan Your Future
2. What Social Security Needs To Know When A Beneficiary Dies
3. Social Security Website
Features Convenient Charts And Maps
4. Divorced? Some Basic Social
Security Facts To Remember
1. ANNUAL SOCIAL SECURITY STATEMENTS CAN HELP YOU PLAN YOUR FINANCIAL FUTURE
By Bob Simpson
What do nearly all American workers now receive each year that they did not receive just five years ago?
Here’s a hint: it is an official government report about you and your personal financial future.
If you have not guessed, the answer is the annual Social Security Statement. This fall marks the 5th anniversary of the four-page Statement that is designed to help workers and their families plan for their financial future. It is mailed to all workers age 25 and older who are not yet receiving Social Security benefits, and should arrive two to three months before their birthday. The Statement provides estimates of retirement, disability and survivors benefits that workers are earning through their Social Security tax contributions.
The Social Security Statement is a valuable financial planning tool that can help Americans prepare for their long-term financial security. Most financial planners say a person needs between 70 and 80 percent of his or her pre-retirement income to live comfortably in retirement. But for the average worker, Social Security replaces only about 40 percent of pre-retirement income. The balance must come from pensions and personal savings.
When you get your Social Security Statement, read it. Seeing your estimated future income numbers in black and white can help you make changes in your savings and investment habits.
Social Security also offers online Benefits Planners that you can use to calculate your estimated retirement benefit (www.socialsecurity.gov/planners/calculators.htm), using different scenarios, such as retiring later, or earning substantially more in later years.
Social Security’s website also offers a Retirement Income Estimator, where you can link to a Ballpark Estimate worksheet sponsored by the American Savings Education Council. The Ballpark Estimate worksheet lets you combine estimates of future Social Security benefits with estimates of income from pensions and savings to determine if you are, in fact, saving enough for a secure retirement.
Whether you are 10, 20 or 30 years from actual retirement, the successful journey to the sort of retirement you envision begins with a first step—which is often a careful reading of the Social Security Statement that you get in the mail each year.
Social Security Column
2. WHAT SOCIAL SECURITY NEEDS TO KNOW WHEN A BENEFICIARY DIES
By Bob Simpson
Sadly,
at some time in our lives, most of us will have to help with funeral
arrangements for a family member or loved one.
During that time of sorrow, it can be difficult to handle the many
practical matters that also must be taken care of.
Oftentimes, these practical matters include talking with the folks at Social Security. Knowing in advance what to expect can help make this task easier.
If the deceased person was already receiving Social Security benefits, we need to be notified. In many instances, a funeral home will take care of the initial notification. If not, a family member or other person responsible for the beneficiary's affairs should promptly notify Social Security of the beneficiary's death by calling our toll-free number, 1-800-772-1213.
If monthly
benefits were being paid through direct deposit, a family member should also
notify the bank or other financial institution of the beneficiary's death. They
should request that any funds received for the month of death and later be
returned to Social Security as soon as possible. If
benefits were being paid by check, it is important not to cash any checks
received for the month in which the beneficiary died or thereafter, and to
return the checks to Social Security as soon as possible.
If you are getting benefits as a wife or husband based on your spouse’s work, when you report the death to us, we will change your payments to survivors benefits. If we need more information, we will contact you.
If you are getting benefits based on your own work, contact us to see if you can get more money as a widow or widower. You will receive the higher benefit, not a combination of the two types of benefits. You will need to complete an application to switch to survivors benefits, and we will need to see your spouse’s death certificate.
Any child receiving benefits automatically will be switched to survivors benefits after the death is reported to us. We will contact you if we need more information.
If you are not currently getting Social Security benefits, you should inquire about survivors benefits promptly because, in some cases, benefits will be paid from the time you apply and not from the time the worker died.
There is also a Social Security lump-sum death benefit of $255 that is available to eligible spouses or dependent children. The survivor can complete the necessary application at the local Social Security office.
So remember: when the time comes that you must deal with a death in the family, Social Security will be there to help make taking care of some inevitable practical matters as easy as possible.
Social
Security Column
3.
CONVENIENT CHARTS AND MAPS ON
SOCIAL SECURITY WEBSITE
By Bob Simpson
In today’s world, most people’s lives are simply too busy and too hectic to pore over complicated information when there are simple, more user-friendly ways to find the same information at just a glance.
Let me give you just two examples—
Suppose you are trying to decide whether you want to retire at age 62, or wait until you reach your full retirement age. Social Security’s website has a chart that quickly shows you what percentage of your full retirement benefits you will be able to get if you decide to retire “early.” You can find this chart at http://www.socialsecurity.gov/retire2/agereduction.htm There is also a chart that shows how much you could earn in “delayed retirement credits” if you intend to work beyond your full retirement age. If you are thinking about doing this, just take a look at the convenient chart at http://www.socialsecurity.gov/retire2/delayret.htm
Here’s a second example.
Suppose you need to visit your local Social Security office.
It is often easy to get momentarily lost—and then be late—when you
are trying to find your way to a place you have never been before.
How do I get to Elm Street from here?
Happily, there is no reason to
have this happen again when coming to our Social Security office … or any of
the agency’s other 1,500 offices across the country.
Here’s why.
If you live in the United States
and you need directions to the Social Security office nearest you, just visit
this web address— www.socialsecurity.gov/onlineservices
. In the left-hand column, you will
find a handy field office locator. You just have to enter your five-digit ZIP
code and you will get the address and phone number of your local Social Security
office, as well as easy-to-understand directions to that office.
We will even provide information about other agencies in the area that
may be of interest or help to you, such as the local Office on Aging or
Vocational Rehabilitation office.
The office locator is a great
service and has, in fact, become one of the top 10 most requested Social
Security services available online.
So remember: if you need information about any Social Security topic, the most convenient and user-friendly option will most likely be a quick visit to our website— www.socialsecurity.gov.
Social Security Column
4.
DIVORCED? SOME BASIC SOCIAL SECURITY FACTS
TO REMEMBER
By Bob Simpson
About
half of all first-time marriages in this country will end in divorce.
If you are divorced, you should know how a divorce affects your Social
Security entitlement.
Here
is a quick overview of Social Security rules concerning divorced spouse’s and
widow(er)’s benefits.
If
you are divorced, you are potentially eligible for benefits on your
ex-spouse’s Social Security record if you were married at least 10 years and
if you are not currently married (or if you are a widow(er) and remarried after
the age of 60). It does not matter
if your former spouse has remarried. You
generally will qualify for benefits based on your former spouse’s earnings
record only if those benefits would be more than you are due based on your own
earnings record.
If
your former spouse is still living, you may be due spouse’s benefits based on
his earnings record if: 1) you are 62 or older; and 2) your former spouse is at
least 62 and eligible for Social Security.
(Your former spouse does not have to be receiving benefits, only eligible
to receive them.) Depending on your
age, you would be eligible for an amount between one-third and one-half of your
former spouse’s retirement benefits, if that amount is more than you are due
based on your own earnings record.
If
you are a divorced widow or widower, you are due between 70 and 100 percent of
your ex’s benefits, depending on how old you are when you start collecting
benefits. (Age 60 is the earliest
age a widow(er) can be eligible.)
Social
Security’s policies for spousal and survivors benefits are gender neutral.
However, it may interest you to know that the majority of working women
are eligible for larger benefit payments based on their own Social Security
earnings record, while their husbands or ex-husbands are still living.
However, many of those women switch to a higher widow’s rate when their
husbands or ex-husbands die.
For more information, you should read the booklet, Social Security: What Every Woman Should Know. It is available online at www.socialsecurity.gov/pubs/10127.html. Or you can request a copy by calling 1-800-772-1213.
Questions
and Answers
RETIREMENT
Question :
Why does my Social Security Statement include an age 70 estimate? I thought that once I turn my full retirement age, I could take my benefits even if I am still working.
Answer:
You are right. And most people who are still working when they reach full retirement age claim their Social Security retirement benefits at that point. But you can choose to delay the start of your benefits until age 70, and collect a higher benefit. Those who do that get “delayed retirement credits” added to their basic Social Security benefit rate. For those born in 1935 or later, that credit is between 6 and 8 percent per year, depending on the year of birth.
DEPENDENT
AND SURVIVOR BENEFITS
Question:
If I apply for a wife’s benefit based on my husband’s earnings record, will that reduce his Social Security benefits? Will it have an impact on any future widow’s benefits I might be eligible for?
Answer:
Any benefit payments we make to you based on your husband’s Social Security record will not reduce his retirement benefits. And the amount of your widow’s benefits depends on whether or not your husband started his benefits before his full retirement age, and how old you would be when you claim widow’s benefits. The timing of your wife’s benefit claim will not impact your future widow’s benefits.
Question:
My father died several years ago and, apparently, my stepmother never knew she was eligible for any Social Security benefits. Is there a statute of limitations for filing for Social Security benefits? If not, can she claim retroactive benefits?
Answer:
Your stepmother can file for Social Security widow’s benefits at any time. If she meets the eligibility criteria, we usually will pay those benefits effective with the month she filed her application. In most cases, we cannot pay retroactive Social Security benefits.
Can I get benefits based on my deceased husband’s
Social Security earnings record? He
has been dead for 14 years, and I will turn 60 in a few weeks. Or do I have to wait until I am 62?
If you meet the eligibility criteria, you can claim
your widow's benefits right now. At
age 60, you would be entitled to about 70 percent of your husband’s benefit
payment amount. If you wait until
age 62, you would be due about 80 percent of those benefits. If you wait until your full retirement age, you would receive
100 percent of your husband’s Social Security benefit payment amount.
I am 63 years old.
My husband is 70 and getting Social Security.
We have been married for about eight years. Someone told me I have to be married more than 10 years to
claim a wife’s benefit based on my husband’s earnings record.
Is this true?
Since you are married, you are eligible for benefits
now. The 10-year rule applies only
to divorced spouses who might potentially be eligible for benefits based on
their former spouse’s Social Security earnings record.
You can apply for those benefits online at www.socialsecurity.gov
or by calling 1-800-772-1213.
DISABILITY BENEFITS
I have worked all of my life, and recently took a
disability retirement from my company. But
my Social Security disability claim was denied.
I have severe arthritis, back problems, and foot trouble.
How many disabilities must I have to be eligible for benefits?
It is not a question of how many impairments you have.
You may be eligible for benefits if one or more of your disabilities is
severe enough to prevent you from doing substantial work for at least a year.
I get a disability check from Social Security.
But I am supporting my 24-year-old daughter.
She is an unemployed single mom with no other income.
Can she also receive Social Security based on my disability?
No. Social
Security only pays dependent’s benefits to children under age 18, or to
children over age 18 if they are disabled.
SUPPLEMENTAL SECURITY INCOME
BENEFITS
Question:
I am a
23-year-old woman who is disabled and receiving monthly Supplemental Security
Income (SSI) payments. I currently
have my own apartment. Can I keep
my SSI check if I move back into my mother’s house?
It depends on the financial arrangements you make with
your mother. If you pay rent to her
(at the prevailing rental rates for your area), or if you pay your share of the
household expenses, then your SSI payment rate will probably remain the same.
You are required to report this to Social Security.
A representative at your local Social Security office can tell you if
your payment will be affected.
I am applying for Supplemental Security Income (SSI)
benefits. If I qualify, will I get
extra money to help pay for all of my medicines?
SSI pays a fixed monthly benefit, depending on your
other income and your living arrangements.
As a general rule, if your SSI claim is approved, you also will be
eligible for Medicaid, which would help pay for some or all of your medications.
You should contact your local social services agency for more information
about Medicaid coverage.
My mother gets Supplemental Security Income (SSI)
payments each month. But for some
reason, she is not getting any extra benefits for my 16-year-old sister, who
still lives at home. Why is this?
The SSI program pays benefits to individuals who are 65
or older or disabled. There are no
provisions for dependent’s or family benefits.
Your sister would qualify for SSI payments herself only if she were
disabled.