Not everyone retires because they want to. A lost job, serious illness or large life change could put you into an early, unwanted, retirement. A recent article from USA Today titled “Forced to retire early? 3 things you can do to put off filing for Social Security” explores the options.

The first thing most people think of is taking Social Security benefits before Full Retirement Age (FRA), which has long-term consequences. The idea seems logical: by taking benefits, you’ll protect your retirement nest egg. However, you’ll receive a lower monthly benefit for life. Instead, consider a few alternatives.

Pursue a part-time job. If finding a full-time job doesn’t work, or if you aren’t physically or mentally able to work full time, a lower-stress part time job could fill in the financial gaps. Employers are eager to find qualified workers, in all kinds of workplaces. You might score a remote part-time job, which would be ideal if mobility is an issue. You may prefer a position where you interact with the public, like the greeter at big box stores. If you’re savvy enough to score a high paycheck, you might be able to get by on a different income level, while letting Social Security benefits grow.

Revise your spending significantly. Take a look at your cashflow. If you’re in a hot housing market, can you sell your current home and move into smaller quarters? Does your family still need two (or three) cars? If you’re among the average Americans who dine out at restaurants several times a week, a return to eating at home could help your budgeting. How many streaming services are you paying for every week?

In some instances, you can’t cut spending, especially for medical care. However, chances are there are some cuts you can make to help trim spending and reduce the withdrawals from retirement accounts, including IRAs, SEPs or 401(k)s.

Can your home create income? Monetizing your home can take a few different forms. Today’s reverse mortgages are not the same as they were thirty years ago. Depending on how much equity you have in your home, you might find the monthly checks help avoid having to take Social Security early.

Could you take in a roommate to help with monthly bills? Obviously, this step requires a lot of thought. However, if an additional $500 would tide you over, it might be a viable option—and you may enjoy the company. There are non-profit organizations that pair seniors with roommates. There are also online apps for people to rent out their fenced backyards by the hour to dog owners who need a safe place to play with their pets.

Knowing there are options can make financial stress a little less overwhelming. Do your homework and find what works for your situation.

BOOK A CALL with me, Ted Vicknair, Louisiana Board Certified Estate Planning and Administration Specialist, Louisiana Board Certified Tax Law Specialist, and Louisiana CPA to learn more about estate planning in Louisiana, incapacity planning, and Louisiana asset protection.

If you liked this article, “Do You Lose Benefits If You Retire Early?” read also these additional articles: Can Estate Planning Reduce Taxes? and Addressing Property in Another State in Estate Planning and What Should I Know about Burial Insurance? and Does Potential IRS Change Have an Impact on Estate Plan?

Reference: USA Today (June 26, 2022) “Forced to retire early? 3 things you can do to put off filing for Social Security”

Medicare is part of the Social Security Administration (SSA), so if you need to enroll in Medicare, that’s whom you contact. But in recent months, phone lines at the SSA were experiencing major technical issues, preventing some individuals from being able to reach the SSA via telephone in a timely manner. These issues affected the SSA’s national 800 number as well as its field office general inquiry phone lines. At the same time, because of the pandemic, SSA offices had not been permitting in-person appointments until early April.

Certain beneficiaries — particularly those without Internet access — were therefore unable to reach the SSA before the end of Medicare’s annual general enrollment period, which typically closes March 31.

As a result, the Centers for Medicare and Medicaid Services (CMS) has announced it will provide what is known as equitable relief to anyone who, due to these challenges, was unable to submit their Medicare enrollment or disenrollment requests after January 1, 2022. These individuals will now have extra time — through Friday, December 30, 2022 — to submit Medicare Part A or Part B enrollment or disenrollment requests without penalty. This relief from penalties also applies to the 2022 Initial Enrollment Period and Special Enrollment Periods.

Individuals who were eligible to be on Medicare and incurred medical care costs during this time period can request retroactive Medicare coverage going back to January 1, 2022. Note, however, that premiums must be paid as a lump sum or else can be deducted from any Social Security benefits the individual currently receives.

Contact the SSA’s national 800 number at 1-800-772-1213 for more information, or find an SSA office near you via the SSA’s online office locator.

BOOK A CALL with me, Ted Vicknair, Board Certified Estate Planning and Administration Specialist, Board Certified Tax Law Specialist, and CPA to learn more about estate planning, incapacity planning, and asset protection.

If you liked this article, “Medicare Enrollment Period Extended for Those Who’ve Been Getting a Busy Signal” read also these additional articles: Requiring Adult Children to Pay for Aging Parents’ Care and Which States Have Been Hardest Hit by the Nursing Home Staffing Crisis? and The Tax Consequences of Selling a House After the Death of a Spouse and What to Do If You Want to Leave Your Children Unequal Inheritances and What are Your Early Signs of Dementia?

Most people don’t understand how Social Security works for themselves or their loved ones. Here’s one major misconception: you can’t file early for Social Security and then get an increased level of benefits once you’ve reached Full Retirement Age, or FRA. This is one of many common errors, according to a recent article “When You Claim Social Security Can Have Huge Implications for Your Spouse” from Kiplinger. Once you’ve started taking benefits before your FRA, your lower level is set for life.

Another common error happens when married couples don’t understand how their benefits impact each other. If your spouse depends on your Social Security benefits to pay the bills, you both need to gain an accurate understanding of how surviving spouse benefits work.

Let’s that say a couple retires and both decide to take their Social Security benefits right away. One is 66 and the other is 62. The older, Pat, receives $3,000 monthly. The younger spouse, Penny, will receive $1,900. Their total household benefit from Social Security is $4,900. If Pat dies first, Penny will lose her own benefit and receive only Pat’s $3,000 monthly benefit. If this is the only income, Penny may face some serious financial challenges.

If Pat started taking benefits earlier than his FRA, at 64 instead of 66, his monthly benefit would be $2,625. If he were to start taking benefits at 62, his Social Security benefit will be even smaller. The reductions are permanent, and they also impact a surviving spouse’s monthly benefit.

What can you do to maximize your spouse’s survivor benefit? Wait for as long as you can to claim your Social Security benefits. For every year you wait, you earn an extra 8% in delayed benefits. These increases grow until age 70, at which point your Social Security benefit reaches the maximum.

Not everyone can afford to delay their benefits. However, when possible, it makes a big difference to the surviving spouse, who is statistically likely to be the female spouse. For couples who can afford to delay benefits, couples with significant age differences and couples where one of the two has exceptionally good health or comes from a family with longevity, this is a worthwhile approach.

Delaying benefits means the loss of benefits during the years until age 70. Forgoing several thousand dollars a month may not be possible for everyone.

If your surviving spouse won’t be able to make ends meet without both Social Security benefits, there needs to be a plan to somehow bridge the gap. How this is done depends upon the individuals and their families. Every situation is different. It is not an easy situation to address. However, one thing is certain: ignoring it will not make the problem go away.

BOOK A CALL with me, Ted Vicknair, Board Certified Estate Planning and Administration Specialist, Board Certified Tax Law Specialist, and CPA to learn more about estate planning, incapacity planning, and asset protection.

If you liked this article, “When a Spouse Dies, Does Survivor Get Their Social Security Benefits?” read also these additional articles: Is Putting a Home in Trust a Good Estate Planning Move? and Senior Second Marriages and Estate Planning and Why Have a Joint Revocable Trust? and Does ‘Gray Divorce’ Fit into Estate Planning?

Reference: Kiplinger (April 20, 2022) “When You Claim Social Security Can Have Huge Implications for Your Spouse”

Money Talks News’ recent article entitled “How Much Can I Earn Before Hurting My Social Security?” says there’s a key difference between retiring and claiming benefits. They don’t have to be done at the same time. They are two separate decisions.

If you can wait to claim beyond your full retirement age, you can really increase monthly benefits. Therefore, if you wait until age 70 to claim, your benefit will be 32% higher than the benefit you’d get if you claim at full retirement age.

Of course, the amount of flexibility you have in delaying claiming depends on what financial resources you have to tide you over until deciding to claim. If you have enough savings, you should think about how low interest rates are today and how little return you get in a savings account. As a result, spending savings now so you can claim benefits later, can lead to much higher benefit income from Social Security in the future.

However, if you don’t have sufficient savings, you’re probably not going to be able to delay claiming, unless you keep working. Therefore, then you should understand the impact continuing to work has on your Social Security benefits.

Continuing to work may increase your future benefits. This will happen if your present income that is subject to Social Security taxes is higher than your income in the past. Your benefits are based on your highest 35 years of earnings, adjusted for inflation. You might also be subject to the earnings test. If you’re not yet at full retirement age, Social Security might reduce your present benefit based on how much you earn.

Benefits lost because of the earnings test will increase benefits at full retirement age, so they aren’t really “lost.” However, the earnings test doesn’t apply once you reach full retirement age.

Therefore, continuing to work will not only bring in more income, but can possibly increase the baseline calculation of your benefits.

If, in addition, working lets you wait to claim your benefits, it could significantly increase the Social Security payments you receive for the rest of your life.

BOOK A CALL with me, Ted Vicknair, Board Certified Estate Planning and Administration Specialist, Board Certified Tax Law Specialist, and CPA to learn more about estate planning, incapacity planning, and asset protection.

If you liked this article, “What’s the Limit for Earning with Social Security?” read these additional articles: Is a Bypass Trust Necessary? and Can Estate Planning Reduce Taxes? and What Did I Hear about Over-the-Counter Hearing Aids? and What’s the Latest on Stroke Prevention?

Reference: Money Talks News (Nov. 18), 2021) “How Much Can I Earn Before Hurting My Social Security?”

No one likes Social Security benefits being taxed. While a dozen states levy a tax on Social Security benefits, there’s no getting away from federal income taxes. A recent article from Investopedia, “Which States Don’t Tax Social Security Benefits,” explains it all.

If you really want to, it is possible to pay zero Social Security taxes. However, this requires staying below the minimum income threshold.

The twelve states that tax Social Security benefits are:

Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, Rhode Island, Utah, Vermont and West Virginia.

Of these, only Minnesota and Utah add an additional Social Security tax using the same income thresholds as the federal government.

However, retirees are advised not to base their choice of retirement location just on this annoying tax. More important factors to be considered include your overall cost of living, quality of healthcare services, geographic proximity to family and friends, available recreational activities, crime rates and climate.

Social Security benefits taxes are not news. These benefits have been taxed since 1983. Taxes depend on the household’s combined income, aka Adjusted Gross Income (AGI), nontaxable interest and half of the couple or individual’s Social Security benefits and filing status.

However, remember that income from other retirement sources may also be subject to federal income taxes. It’s not just Social Security. Pension payments are either fully or partially taxable, based on how much after-tax dollars went into the accounts.

The only way to avoid having Social Security benefits taxed by all federal and local taxing authorities is to remain way below the minimum income threshold, or using tax-free Roth account withdrawals, Qualified Longevity Annuity Contracts (QLACs, which are getting new attention due to recent legislation) or living on a shoestring. Most people have to live with some level of taxation on their benefits.

Nine states don’t have any state income tax, which means no state level taxes Social Security income. If taxes are your key reason on choosing where to live, consider Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming for your retirement location.

BOOK A CALL with me, Ted Vicknair, Board Certified Estate Planning and Administration Specialist, Board Certified Tax Law Specialist, and CPA to learn more about estate planning, incapacity planning, and asset protection.

If you liked this article, “Can I Avoid Paying Taxes on Social Security?” read these additional articles: What Can a Trust Do for Me and My Family? and Can You Get a Tax Deduction for Giving a Gift? and Am I Getting All the Social Security Benefits I Can? and How Do I Give Assets to Minor Grandchildren in My Will?

Reference: Investopedia (Jan. 25, 2022) “Which States Don’t Tax Social Security Benefits,”

Money Talks News’ recent article entitled “7 Social Security Benefits You May Be Overlooking” says that the Social Security Administration provides payments to spouses, children and those with disabilities, among others. Let’s look at this in detail.

1. Spousal benefits via a husband or wife. Spouses can get up to half of their husband’s or wife’s monthly benefit. Even stay-at-home spouses without their own work history can claim benefits with this method. You can start claiming spousal benefits as early as age 62. However, benefits are reduced if payments begin before your full retirement age. If you are entitled to your own benefits, as well as spousal benefits, you will get an amount equal to whichever benefit level is greater.
2. Spousal benefits via an ex-spouse. Even if you are divorced, you may be entitled to get spousal benefits. However, all of the following must apply to your situation:

• Your ex-spouse is entitled to receive Social Security benefits;
• You were married at least 10 years to your ex-spouse;
• You are currently unmarried; and
• You are at least 62 years old.

The benefit that you are entitled to get based on your own work is less than the benefit you would receive based on your ex-spouse’s work. Claiming spousal benefits as a divorced person does not impact your ex’s benefit amount. It also does not affect any benefits their current spouse can receive, if they have remarried.

3. Survivor’s benefits for widows and widowers. If your spouse dies, you may still be able to receive up to 100% of their Social Security retirement benefits. Divorced spouses may also be able to get survivor’s benefits, if they were married for at least 10 years and are now unmarried. Most widows and widowers can begin claiming survivor’s benefits as early as age 60. Those who have a disability and became disabled prior to or within seven years of their spouse’s death can start benefits as early as age 50. In addition, widows and widowers of any age can get survivor’s benefits, if they are caring for a deceased worker’s child who’s younger than age 16 or disabled.
4. Survivor’s benefits for children. Children can get payments from a deceased parent’s record as well. Survivor’s benefits are available to children up to age 18 (or 19 for if attending elementary or secondary school full-time).  These benefits may extend beyond that, if a child becomes disabled and remains disabled before age 22. Depending on the circumstances, grandchildren and stepchildren may also be eligible for these benefits.
5. Parent’s benefits. Parents who depended on their children for financial support may be eligible to get benefits from Social Security if that child dies. To be eligible , you have to meet a number of criteria, including the following:

• The deceased worker must have sufficient work credits to qualify for Social Security benefits;
• You must be at least age 62 and, in most cases, cannot be married after the worker’s death;
• You must have received at least half of your support from the deceased worker at certain points in time;
• You were the natural parent or became the legal adoptive parent or stepparent prior to the worker turning 16 years old; and
• You are not eligible for a retirement benefit from Social Security that exceeds the parent’s benefit.

6. Disability benefits. To get monthly benefits through the Social Security Disability Insurance program you must have a work history that makes you eligible for Social Security and be unable to work now because of a medical condition that is expected to last at least a year or end in death.
7. Supplemental Security Income. These benefits do not come from Social Security taxes, but rather the program uses general tax dollars to provide benefits to adults and children with disabilities, blindness, or limited income and resources. The SSI program is designed to provide cash assistance for basic needs, such as food, clothing and housing. Because it is funded by general tax revenue, there is no work history requirement to receive these benefits.

BOOK A CALL with me, Ted Vicknair, Board Certified Estate Planning and Administration Specialist, Board Certified Tax Law Specialist, and CPA to learn more about estate planning, incapacity planning, and asset protection.

If you liked this article, “Am I Getting All the Social Security Benefits I Can?” read these additional articles: How Do I Give Assets to Minor Grandchildren in My Will? and How to Protect Valuable Assets in Estate Planning and Social Security Retirement Age Changing and What Does that Mean to Payment? and How to File Tax Return When Mom Passes Away

Reference: Money Talks News (Feb. 8, 2022) “7 Social Security Benefits You May Be Overlooking”

US News’ recent article entitled “The Social Security Retirement Age Increases in 2022” examines the way in which the Social Security retirement age is changing, and what this means for your retirement payments.

The full retirement age (FRA) was 65 for those born in 1937 or earlier. Those born between 1943 and 1954 have a full retirement age of 66. The full retirement age further increases in two-month chunks each year to 66 and 10 months for those born in 1959. That is up from 66 and eight months for those with a birth year of 1958. The FRA for those who turn age 62 in 2022, born in 1960, is now 67. The full retirement age will remain age 67 for everyone born in 1960 or later.

Workers who are eligible for Social Security can begin receiving payments at age 62, regardless of their full retirement age. However, the benefit reduction for early claiming is more for those who have an older retirement age. You get less if you start early or more if you delay until later. Every month you delay Social Security up to age 70 gets you a higher monthly payment for life.

For a worker eligible for a $1,000 monthly Social Security benefit at his full retirement age, claiming at age 62 will reduce his monthly payment to $750 if his birth year is 1954 and $700 if he was born in 1960.

Social Security’s annual cost-of-living adjustments will be also applied to these reduced payments, resulting in a smaller dollar value of the inflation adjustments.

You can increase your monthly payments by delaying claiming Social Security after your FRA age up until age 70. However, those with an older retirement age have fewer months to delay claiming Social Security and less of an opportunity to earn delayed retirement credits. If a person files at age 70, with a full retirement age of 66, it means they waited 48 months beyond full retirement age, so they would get 132% of their primary insurance amount. However, if they file at 70 with a full retirement age of 66 and six months, that means they waited 42 months beyond full retirement age, so they would only get 128% of their primary insurance amount.

Your age when you start to claim Social Security significantly impacts the amount you will receive throughout retirement. Whatever your birth year, there are ways to boost your monthly Social Security payments. You can delay claiming, continue to work and coordinate benefits with a spouse.

BOOK A CALL with me, Ted Vicknair, Board Certified Estate Planning and Administration Specialist, Board Certified Tax Law Specialist, and CPA to learn more about estate planning, incapacity planning, and asset protection.

If you liked this article, “Social Security Retirement Age Changing and What Does that Mean to Payment?” read these additional articles: How to File Tax Return When Mom Passes Away and What’s a Medicaid Annuity? and Should I Delay Claiming Social Security? and What Foods are Bad for Joints as Aging Occurs?

Reference: US News (Jan. 24, 2022) “The Social Security Retirement Age Increases in 2022”

Getting the timing right on Social Security is important. Deciding when to claim is a decision requiring thoughtful planning and accurate information. A recent article from York News-Times titled “3 Reasons to Put Off Social Security for Another Year and 2 Reasons Not to” takes a common-sense approach.

There are good reasons to delay taking Social Security benefits. First, if you are under 70, the longer you delay benefits, the larger your checks. Benefits grow anywhere from 5/12^th of a month to 2/3^rd of 1% per month, depending upon your Full Retirement Age (FRA) and your current age. FRA is the age when you qualify for a standard benefit, based on your work history. For most of today’s wage earners, this is sometime between age 66 and 67.

A second reason to delay: you may get a larger lifetime benefit, if you live into your mid-80s or beyond. However, those who need the income to pay bills may not have a choice, even if they have not reached their FRA. If possible, delaying by a few months might be helpful to increase benefits.

A third reason is if you are still working. If you are working and earning a decent salary and have not yet reached your FRA, you may run into problems with the Social Security Earnings Test. The federal government deducts $1 from each monthly benefit for every $2 you earn over $19,560 in 2022, if you will be younger than your FRA for the entire year. If you will reach your FRA in 2022, you will still have a deduction, but this will be $1 for every $3 you earn over $51,960. If you are still working, delaying taking benefits makes sense.

The good news: the money will not be out of your pocket forever. Once you reach FRA, your benefits are recalculated to include the amount previously withheld, making checks larger. However if you do not need benefits right away, the best decision is to delay taking Social Security until you retire.

There are also reasons why delaying taking Social Security benefits is not necessary. The biggest one is if you are 70 or older. The benefits stop growing on your 70^th birthday, so there is no reason to delay. Make sure you at least sign up for benefits by your 70^th birthday.

If your life expectancy is not great, then there is no incentive to waiting. If you pass away before signing up for benefits, you might not get any money from Social Security. Take an honest look at your own health and your family’s health history. If you think you might not live all that long, or if everyone in the family passes early, it may make sense to apply for Social Security, even before your FRA.

When you sign up for benefits matters a lot. The Social Security Administration has calculators on its website to use once you have created a my Social Security account. This will give you an idea of how much you can expect to receive in Social Security benefits at various ages, based on your own work history.

It also makes sense to align your estate plan and retirement plans with Social Security.

BOOK A CALL with me, Ted Vicknair, Board Certified Estate Planning and Administration Specialist, Board Certified Tax Law Specialist, and CPA to learn more about estate planning, incapacity planning, and asset protection.

If you liked this article, “Should I Delay Claiming Social Security?” read these additional articles: What Foods are Bad for Joints as Aging Occurs? and What Should I Eat to Prevent Kidney Stones? and What are Common Mistakes People Make with Living Trusts? and Does the Executor Control Bank Accounts?

Reference: York News-Times (Jan. 27, 2022) “3 Reasons to Put Off Social Security for Another Year and 2 Reasons Not to,”

Money Talks News’ recent article entitled “These 13 States Tax Social Security Income” says the federal government can tax plenty of types of retirement income — including Social Security benefits.

The taxation doesn’t necessarily stop with the federal government because there are a number of state governments that also expect a cut from your Social Security income. In fact, there are 13 states that tax Social Security benefits:

• Colorado
• Connecticut
• Kansas
• Minnesota
• Missouri
• Montana
• Nebraska
• New Mexico
• North Dakota
• Rhode Island
• Utah
• Vermont
• West Virginia

Whether your Social Security retirement benefits are subject to federal income taxes is determined by your tax filing status and what the U.S. Social Security Administration calls your “combined income.” This is your wages and self-employment income, interest and dividends and other taxable income. If your benefits are subject to federal taxes, the federal government will tax up to 85% of your benefits.

States that tax Social Security benefits do so according to their own rules, which can vary from state to state and differ from the federal tax code. Therefore, even if your benefits aren’t subject to federal taxes, they could still be subject to state income taxes — or vice versa. It depends on how a state taxes income and whether it offers any tax breaks that apply to Social Security income.

For example, Connecticut offers some residents a full exemption from state income tax for benefits. These residents pay no taxes on Social Security income, if one of the following situations applies: (i) their federal filing status is single or married filing separately, and their federal adjusted gross income is less than $50,000; or (ii) their federal filing status is married filing jointly, head of household or qualifying widow/widower and their federal adjusted gross income is less than $60,000.

BOOK A CALL with me, Ted Vicknair, Board Certified Estate Planning and Administration Specialist, Board Certified Tax Law Specialist, and CPA to learn more about estate planning and asset protection.

If you liked this article, “Will My Social Security Benefits Be Taxed?” read these additional articles: When Should a Trust Be Reviewed? and Does a Trust Protect You From a Lawsuit? and Will I Be Ready for Long-Term Care? What to Do with an Inherited IRA?

Reference: Money Talks News (Sep. 22, 2021) “These 13 States Tax Social Security Income”

Many seniors choose to work later in life. It will have an effect on their Social Security benefits, says nj.com’s recent article entitled, “If I work past age 70, can my Social Security benefits increase?”

You must pay FICA (Federal Insurance Contribution Act) taxes, commonly called Social Security and Medicare taxes, if you have income that’s covered by Social Security.

The tax is imposed on your earnings up to a maximum amount. For 2021, that maximum amount is $142,800.

Your Social Security benefit at full retirement age (FRA) is determined by taking your highest 35 years of earnings on which Social Security tax has been levied, indexed for inflation.

The maximum amount of your benefit is capped because of the maximum amount of income on which Social Security tax is levied.

If you continue to work while collecting Social Security at any age, your benefit could increase, if your earnings are one of the 35 highest years you have earned.

The increased benefit is automatically calculated by the Social Security Administration and is paid to you in the December of the next year.

However, working while collecting Social Security benefits has other complexities you should consider.

If you’re younger than full retirement age (FRA) and you earn more than a certain amount, your benefit will be reduced.

For example, for 2021, if you’re below YOUR FRA for the whole year, your benefit will be reduced $1 for every $2 you earn over $18,960.

However, the benefit isn’t actually lost. That’s because when you reach your full retirement age, your benefit will increase to reflect the amount withheld.

If you have substantial income — any and all income that must be reported on your tax return — other than your Social Security income, up to 85% of your Social Security income will be taxable.

To learn more about social security, read: Common Mistakes in Claiming Social Security and What Happens to Social Security Payments after a Person Dies? and Should a Trust Be Part of My Estate Planning? and What are the Most Popular Estate Planning Scams?

If you want to discuss anything related to estate planning or planning for your financial future, BOOK A CALL with Ted Vicknair.

Reference: nj.com (July 26, 2021) “If I work past age 70, can my Social Security benefits increase?”