Social Security Simplified

Transcription

1 Social Security Simplified A NARFE Federal Benefits Institute Webinar Presented by Tammy Flanagan 1 Sponsored by

2 Audience Poll What do you think is the most complicated part of Social Security? A. Understanding the calculation B. Determining the best age to claim the benefit C. Figuring out how to save it for the future D. I am not sure 2 Sponsored by

3 Facts $1,360 average monthly benefit % of individuals age 65+ receive Social Security Represents 34% of income 43% of unmarried individuals say Social Security is 90% or more of income 21% of married couples say Social Security is 90% or more of income Social Security Administration 2017 Fact Sheet 3 Sponsored by

4 What is Your Retirement Timeline? Eligible for Social Security Maximum Delayed Social Security Credits Retire from Federal Service Full Social Security Retirement Age Expiration Date 4 Sponsored by

5 5 Steps Toward Your Financial Security Get to know your Social Security Verify your earnings Estimate your benefits Apply for benefits Manage your benefits 5 Sponsored by

6 Service Field Offices Support Get to Know Social Security FICA: Federal Insurance Contributions Act OASDI Old Age, Survivor and Disability Insurance Security 80 years: million retirees, children, widows, widowers Cybersecurity Fraud Protection Privacy and Security questions 6 Sponsored by

7 My Social Security account Verify Your Earnings Replaces on average 40% of your pre-retirement income More for those who earn less Less for those who earn more Request a replacement card Check status of application Review your estimated benefits To receive by mail complete form SSA Sponsored by

8 CSRS: Windfall Elimination Provision Online Calculators Estimate Your Benefits CSRS (single) vs FERS (3 tier) Pay the FICA tax on wages up to $127,200 (2017) 8 Sponsored by

9 Estimate Your Benefit High-35 years Up to maximum taxable wages Index (adjust) wages Divide total by 420 months = Average Indexed Monthly Earnings AIME 9 Sponsored by

10 Benefit formula AIME: $2,644 90% X $886 = $ % X $1,758 ($887 - $5,336) = $ % X Over $5,336 = $0 Monthly benefit at age 66 $1, Reduced monthly benefit at age 62 $1, Delayed credits at age 70 $1, Sponsored by

11 Windfall Elimination Provision Pension from work not covered by Social Security i.e., CSRS or CSRS Offset Will not eliminate benefit Does not apply if working / over full retirement age Affects YOUR benefit 11 Sponsored by

12 WEP Benefit formula AIME: $2,644 40% X $886 = $ % X $1,758 ($887 - $5,336) = $ % X Over $5,336 = $0 Monthly benefit at age 66 $ Reduced monthly benefit at age 62 $ Delayed credits at age 70 $1, Sponsored by

13 Financially Dependent Spouse Breadwinner Must file for current spouse to receive Delay in benefit increases widow s amount Spouse in the house Must be at least 62 (reduced) 50% at full retirement age 13 Sponsored by

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15 Online: Phone: In Person: Field Offices Apply for Benefits Social Security number birth certificate W-2 forms for last year Your military discharge Retirement Medicare Disability Survivors Spouse's birth certificate and SSA number Children's birth certificate and SSA numbers Bank account number 15 Sponsored by

16 Full Retirement Age Social Security's Full Retirement Age (FRA) is increasing gradually because of legislation passed by Congress in Sponsored by

17 When Should I Apply? How much will you be earning at age 62? Do you need the money? How long will you live? Is there someone else depending on your income? 17 Sponsored by

18 I plan to work past age 62 Benefit may be reduced: $16,920 earnings limit No earnings limit after full retirement age CSRS employees: NO WEP or GPO after full retirement age if working 18 Sponsored by

19 I don t plan to work past age 62 Social Security is one part of the three parts of FERS - you may need the income to afford to retire! Social Security is an actuarial benefit Smaller benefit more years Larger benefit fewer years 19 Sponsored by

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21 Can I afford to retire without Social Security? Provides an average replacement of 40% of pre-retirement wages Tilted formula provides more to those who earn less but less to those who earn more. 21 Sponsored by

22 How Long Will I Live? Start early? Delay benefit? Age at death Begin benefit Age 62 ($1,305) $46,980 $203,580 $360,180 $516,780 Age 66 ($1,740) $0 $187,920 $396,720 $605,520 Age 70 ($2,300) $0 $138,000 $414,000 $690, Sponsored by

23 Change your address or phone number Check appeal / application status Start or change a direct deposit or tax withholding Manage Your Benefits 23 Sponsored by

24 Dependent Spouse: $6,900 / month Breadwinner: $1,800 / month (Social Security) $3,000 / month (FERS) $2,700 / month (FERS reduced for survivor annuity) $1,500 / month (TSP) Dependent Spouse: $900 / month (spousal Social Security) 24 Sponsored by

25 Dependent Spouse Dies: $6,300 / month Breadwinner: $1,800 / month (Social Security) $3,000 / month (FERS) $1,500 / month (TSP) Dependent Spouse: Deceased 25 Sponsored by

26 Breadwinner Dies: $4,800 / month Breadwinner: Deceased Dependent Spouse: $1,800 / month (widow s Social Security) $1,500 / month (FERS survivor annuity) $1,500 / month (TSP) 26 Sponsored by

27 Government Pension Offset Pension from work not covered by Social Security i.e., CSRS Will generally eliminate benefit Does not apply if working / over full retirement age Affects benefit YOUR SPOUSE earned for you (or former spouse) 27 Sponsored by

28 CSRS and FERS couple: $11,422 / month CSRS Spouse $6,000 / month (CSRS) CSRS Reduced for Survivor Annuity to $5,422 No Social Security FERS Spouse $1,800 / month (Social Security) $3,000 / month (FERS) Reduced for survivor annuity to $2,700 $1,500 / month (TSP) 28 Sponsored by

29 Survivor is FERS Retiree: $9,600 / month CSRS Spouse Deceased FERS Spouse $1,800 / month (Social Security) $3,000 / month (FERS) $3,300 / month (CSRS survivor annuity) $1,500 / (TSP) 29 Sponsored by

30 Survivor is CSRS Retiree: $9,000/month CSRS Spouse $6,000 / month $1,500 (50% FERS survivor benefit) $1,500 (TSP) No Social Security Social Security Spouse (FERS) Deceased 30 Sponsored by

31 Get connected to the lifestyle you want Learn about how GEHA health plans work with Medicare Parts A&B. Download our Medicare + GEHA brochure at: geha.com/narfe / gehahealth GF-PPT Sponsored by