Social Security: With You Through Life s Journey Produced at U.S. taxpayer expense
Over 60 Million Receiving Benefits 9 million Disabled Workers, 2 million Dependents 4 million Widows/ Widowers 41 million Retired Workers 3 million Dependents 2 million Children of Deceased Workers 2
How Do You Qualify for Retirement Benefits? By earning credits when you work and pay Social Security taxes You need 40 credits (10 years of work) and you must be 62 or older Each $1,320 in earnings gives you one credit You can earn a maximum of 4 credits per year Note: To earn 4 credits in 2018, you must earn at least $5,280.00.
Year of Birth Full Retirement Age 1943-1954 66 1955 66 and 2 months 1956 66 and 4 months 1957 66 and 6 months 1958 66 and 8 months 1959 66 and 10 months 1960 + 67
What Is the Best Age to Retire? Age You Choose to Start Receiving Benefits Note: This example assumes a benefit of $1,000 at a full retirement age of 66
my Social Security socialsecurity.gov/myaccount
my Social Security Services Annually review your Social Security Statement (wages & estimates) In some states, request a replacement Social Security (SSN) card Check the status of your application or appeal Get a benefit verification letter for proof of income Change your address, phone #, or direct deposit info Get a replacement SSA-1099 for taxes Get a replacement Medicare Card Enter User Name, Password, & Security Code (sent by text/email)
How Social Security Determines Your Benefit? Benefits are based on earnings Step 1 -Your wages are adjusted for changes in wage levels over time Step 2 -Find the monthly average of your 35 highest earnings years Step 3 -Result is average indexed monthly earnings Consult your my Social Security account or the online Estimator
What You Can Expect at Full Retirement Age 60% 50% 40% 30% 20% 10% 56% 55% 41% 41% 34% 34% Preretirement % of Earnings 0% Low Earner Average Earner High Earner
Windfall Elimination Provision (WEP) If any part of your pension is based on work not covered by Social Security, you may be affected by the Windfall Elimination Provision. socialsecurity.gov/planners/retire/wep.html
2018 Retirement Benefit Formula If your average monthly earnings are = $5,500 Then your monthly benefit would be = $2,245 Windfall Elimination Provision (WEP) 40% $358 90% of First... $895 = $806 32% of Earnings over $895 through $5,397.. $4,502 = $1,441 ($5,397 - $895= $4,502) *Payments rounded to whole dollar amounts 15% of Earnings over $5,397... $103 = $15 $5,500 $2,262 Max WEP reduction in 2018 is $448/month $1,814
Exception to the WEP Years of Substantial Earnings % of First Factor in Benefit Formula 30 or more 90 29 85 28 80 27 75 26 70 25 65 24 60 23 55 22 50 21 45 20 or fewer 40
WEP Substantial Earnings Amount Year Substantial Earnings Amount 2008 $18,975 2009 $19,800 2010 $19,800 2011 $19,800 2012 $20,475 2013 $21,075 2014 $21,750 2015 $22,050 2016 $22,050 2017 $23,625 2018 $23,850 Use the online WEP Calculator to understand your benefit www.ssa.gov/ planners/benefit calculators.html
Retirement Estimator Gives estimates based on your actual Social Security earnings record You can use the Retirement Estimator if: You have enough Social Security credits at this time to qualify for benefits and You are not: Currently receiving benefits on your own Social Security record; Waiting for a decision about your application for benefits or Medicare; Age 62 or older and receiving benefits on another Social Security record; or Eligible for a Pension Based on Work Not Covered By Social Security. socialsecurity.gov/estimator
Spouse s Benefit Computation Example: Mary s Full Amount at her FRA = $800 Her husband s Full Amount at his FRA = $2000 50% of husband s FRA = $1000 ($2000 divided by 2) $1000 Mary s maximum spousal benefit - $800 Mary s own full benefit (at her FRA) $200 Mary s spousal payment Mary's spousal benefit ($200) is added to her own FRA benefit ($800) for a total benefit of $1000
Surviving Spouses can: Receive full survivor benefit at his/her FRA; or At age 60, receive 71.5% of your full benefit; waiting increases payment amount; or If disabled, receive as early as age 50 Remarry after age 60 (50 if disabled) and remain eligible Divorced Spouse: 10-year marriage required Reminder: If claiming benefits before FRA, wage earning limits apply ($17,040 in 2018)
Social Security Spouse s Benefits If born after 1/1/1954, must file for your own benefit first Spouse payment: Does not reduce payment to the worker Amount: up to 50% of worker s full benefit amount, but less if claimed early Calculation: If own full benefit is less than 50% of the worker s full benefit, the benefits are combined (e.g., greater amount paid) Example next slide Divorced Spouse: 10-year marriage and single (former spouse not required to apply for own benefit, at least 62)
Government Pension Offset (GPO) A type of benefit reduction that may affect some spouses and widows or widowers If you receive a government pension based on work not covered by Social Security, your SS spouse s or widow(er) s benefits may be reduced. socialsecurity.gov/gpo
Government Pension Offset (GPO) 2/3 of amount of non-covered pension will be used to reduce the Social Security spouse s/widow(er) s benefits. Examples: $1200 Non-covered Pension 2/3 = $800 If Social Security spouse s or widow(er) s benefit = $750, no benefit payable due to offset If Social Security spouse s or widow(er) s benefit =$1000, $200 would be payable after offset socialsecurity.gov/gpo
Benefits for Children Child Disabled Child Can receive benefit if not married and is under age 18 (or under age 19 if still in high school) Can receive benefits beyond age 18 if not married and was disabled before age 22
Working While Receiving Benefits If you are Under Full Retirement Age The Year Full Retirement Age is Reached Month of Full Retirement Age and Above You can make up to If you earn more, some benefits will be withheld $17,040/yr. $1 for every $2 $45,360/yr. before month of full retirement age No Limit $1 for every $3 No Limit Note: If some of your retirement benefits are withheld because of your earnings, your benefits will be increased starting at your full retirement age to take into account those months in which benefits were withheld.
Age 65 After 24 months of SSDI Medicare Eligibility ALS Kidney failure
Part A - Hospital Insurance Medicare Coverages Covers most inpatient hospital expenses 2018 Deductible $ 1,340 Part B - Medical Insurance Covers 80% doctor bills & other outpatient medical expenses after 1 st $ 183 in approved charges 2018 standard monthly premium $134 Some current beneficiaries may pay less Part D - Medicare Prescription Drug Plan Covers a major portion of prescription drug costs for people on Medicare Annual Enrollment Period: October 15 through December 7 Extra Help Program Helps Pay Drug Costs for those with Low Income/Resources visit webpage for details
Initial Enrollment Period Begins 3 months before your 65 th birthday and ends 3 months after that birthday General Enrollment Period January 1 March 31 Medicare Enrollment Special Enrollment Period If 65 or older and covered under a group health plan based on your or your spouse s current work. 1-800-MEDICARE www.medicare.gov
Applying for Benefits 3 options available to apply: Online By phone 1-800-772-1213 At our office You choose the most convenient option for you! Note: Child, survivor and some Supplemental Security Income (SSI) claims can only be done by phone or in a field office (not online) at this time.