Q. I am 61 years old. My husband is only 51. I have worked most of my life and paid Social Security taxes for many years. And now I’ve learned that I will not be able to collect a dime of my Social Security until my husband is getting his own Social Security. This is totally unfair!

A. Yes, it would be totally unfair if it was true. But it’s not true. You can get your own Social Security retirement benefit, beginning as early as age 62, whether your husband is 51 or 151 … or 21, for that matter. His age, and his Social Security eligibility, have nothing to do with your potential entitlement to benefits.

It is true that you wouldn’t be able to collect any dependent wife’s benefits on his record until he is old enough for Social Security and getting his own monthly checks.

But you are talking about your own monthly checks. And nothing about him and his Social Security has anything to do with you and your own Social Security retirement benefits.

Q. I just heard something about Social Security that is making my blood boil! I am 63 years old and never worked outside the home. My husband is 62 and is still working. He doesn’t plan to retire and apply for Social Security until he is 66 years old. And I was told I have to wait until he signs up for Social Security before I can get any

Social Security myself. If this is true, I’m upset. But here is what really ticks me off. I have a friend who is divorced. She is 62 years old. Like me, she never worked. Her ex husband, like my husband, is 62, and he’s still working. He also plans to keep working until age 66 before he applies for Social Security. But my friend says she has already applied for divorced wife’s benefits, and her checks will start soon! How can this possibly be fair?

A. It’s totally fair. And I’ll explain why. It all has to do with the issue of dependency — the core entitlement issue for any kind of Social Security spousal benefit.

You and your husband are still married. Because you don’t work outside the home, you are financially dependent on your husband. That’s what makes you potentially eligible for a dependent wife’s benefit on his record. But because he is still working, the law assumes he is still supporting you financially. There is no reason to pay you a dependent spouse’s Social Security benefit while your husband is still working. To put it more bluntly: why should the taxpayers support you when your husband is still supporting you?

Someday he will retire, and Social Security will start paying him a retirement benefit that’s intended to partially replace the income he’s lost because he stopped working. And at that time, Social Security will start paying you a wife’s benefit that’s intended to partially replace that portion of his income he was using to support you.

But your friend’s case is different. The law cannot assume that her ex husband is supporting her. So the rules cut divorced women a bit of a break. She is able to get a dependent wife’s benefit on her husband’s record even if he isn’t yet getting Social Security retirement benefits himself. He simply has to be old enough to qualify for benefits.

You said your friend’s ex is 62. That makes him old enough for Social Security. And your friend is also 62, meaning she is also old enough to qualify for divorced wife’s benefits.

Q. You recently wrote a column where you mentioned a divorced woman getting benefits from her husband’s account. And he was still living. I think you are wrong. A divorced woman cannot get benefits from her ex husband’s record until he dies.

A. No, I’m not wrong. A divorced woman can get benefits on her ex husband’s Social Security record while he is still living.

Any woman age 62 or older can get a dependent wife’s benefits on her husband’s Social Security retirement account IF she isn’t due higher benefits on her own Social Security record. And as explained in the answer to the prior question, a divorced woman may be able to get spousal benefits even if her ex isn’t getting Social Security himself yet.

Q. How come my wife isn’t getting half of my Social Security? My monthly check is $1,850. She’s only getting $700 per month. Shouldn’t she be getting $925?

A. If this isn’t the most common question I’m asked, it’s certainly in the top five! A wife is entitled to half of her husband’s Social Security check IF she waited until age 66 to claim such benefits. But most women start getting dependent wife’s benefits before age 66. And those benefits are reduced roughly one half of one percent for each month they are taken before 66. I’m guessing your wife started getting benefits between age 62 and 63, meaning she’s due less than 40 percent of your rate.

If you have a Social Security question, Tom Margenau has the answer. Contact him at thomas.margenau@comcast.net. To find out more about Tom Margenau and to read past columns and see features from other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.
COPYRIGHT 2012 CREATORS.COM

I’ve been either working for the Social Security Administration or writing a column about Social Security issues for about 40 years now. And I would have bet money that in all that time, I’ve been asked every question in the book. In fact, I don’t recall getting a question in the past 15 years or so that I haven’t been asked a dozen, if not hundreds, of times before. And now this week, I’ve had two questions emailed to me that I’ve never been asked in my entire career! Will wonders never cease? The first deals with the relationship between disability and retirement benefits.

Before I answer the question, let me give some background information. If you are getting Social Security disability benefits, and if you are still getting those benefits as you start to push normal retirement age, then at age 66 you are automatically switched to the retirement program. The changeover is generally transparent to you because the benefit amount remains the same. Or, to put that another way, a Social Security disability benefit pays the same rate as your full age 66 retirement benefit. So when you reach age 66, nothing really changes — moneywise. But on Social Security’s books, you are switched from the disability ledgers to the retirement ledgers. That means from age 66 on, your benefits are paid from the retirement trust fund and not the disability trust fund.

So now, here is the first question I was asked that I’ve never been asked before.

Q. I am 65 years old and have been getting Social Security disability benefits for about five years now. I’ve been told that I will be switched to the Social Security retirement program at age 66. But can I delay that switchover until age 70 and then get the 32 percent “delayed retirement bonus” you have written about in past columns?

A. If you are asking — “Can I continue receiving disability benefits until age 70 and then switch to retirement benefits with a 32 percent bonus?” — the answer is: no.

But if you are asking — “Can I stop my disability benefits at age 66 and delay the switchover to retirement benefits until age 70?” — the answer is: I guess you can. I can’t think of any rule that would prevent you from doing this. However, I am going to suggest that you think things through first.

I’ve written columns lately about folks who are “gaming the system,” playing around with their Social Security benefits trying to get the maximum return on their “investment.” Most of these retirees are delaying taking benefits as long as possible. They will generally win that Social Security game if they live until their mid to late 80s. Personally, I would never do it. I’d rather spend a little bit smaller Social Security check while I’m still young enough to enjoy it — as opposed to spending a bigger check once I’m in the old folks home!

And you are playing against even bigger odds. After all, you are getting Social Security disability benefits presumably because you have some pretty bad health problems. So do you really think you are going to live long enough beyond age 70 to come out ahead by giving up all those Social Security checks you essentially want to throw away between age 66 and 70?

It’s your money, and you can do what you want with it. But I think you are trying to squeeze too much blood out of Social Security’s turnip!

The second question deals with the retirement program. It comes from a person who forgot that he signed up for Social Security!

Q. I applied for Social Security when I was 62 years old. But almost immediately afterwards, I decided to return to work. I went back to my Social Security office, and they suspended my benefits. At the time, we figured it would be temporary, because I thought I might stop working shortly thereafter. Long story short: I just kept working and frankly forgot that I had signed up for Social Security. Now, I’m about to turn 66. I want to start up my Social Security benefits again. How do I do that? And am I stuck with the early retirement reduction I took at age 62?

A. Forgot you filed for Social Security, huh! That sure is one I’ve never heard before. But I’ve got good news for you. And then I have even better news for you.

The good news is that starting up your benefits again will be a piece of cake. You simply need to contact Social Security and some representative there will push a few buttons and your monthly checks will soon be on the way.

The better news is that you will NOT be stuck with the reduction you took by initially filing for Social Security at age 62. Even though your age 62 benefit rate came with a 25 percent early retirement reduction, there is a rule that says when you reach age 66, your benefit is refigured to give you credit for any months between age 62 and 66 where you didn’t get a Social Security check.

In your case, all 48 Social Security checks you normally would have received between age 62 and 66 were held back. So you get credit for 48 months’ worth of reduction — meaning your benefit will be reset at your age 66 full retirement rate.

I’d suggest you sit down with a representative at your local Social Security office to go over all of this and make sure you get the full readjustment of your monthly benefits.

If you have a Social Security question, Tom Margenau has the answer. Contact him at thomas.margenau@comcast.net. To find out more about Tom Margenau and to read past columns and see features from other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.

I find it rather curious that baby boomers, many of whom, in their youth, decried the accumulation of wealth and the materialism of their parents, are the first generation in history to regard Social Security not as the safety net it was intended to be but rather as a pot of gravy to pour over their already meaty investment portfolios.

I’m not saying this is a bad thing. In fact, it is just the opposite. People have always been encouraged to plan for their retirement. And baby boomers have, by and large, done a good job of that. Social Security was never meant to be a person’s sole source of income in retirement. Instead, it was meant to be one leg of the proverbial three-legged stool that should prop up your retirement nest egg — the other two legs being a pension or IRA account and whatever savings or other investments you are able to accumulate throughout your working life.

It’s just that all this focus on Social Security as an investment, sometimes even as a gambling stake, is still a relatively new phenomenon — especially to a guy who spent most of the last 40 years helping folks sign up for Social Security. And almost all of those people simply applied for benefits at 62, or maybe 65 — and just let the checks start rolling in without giving it too much thought. A Social Security check was simply something you got in your old age, and you used that check to pay the rent or buy groceries.

Today, more and more folks are trying to “game” the system — doing their utmost to squeeze every last nickel out of their Social Security investment. They are putting off taking Social Security until age 70 in order to get a 32 percent “delayed retirement bonus.” Many are claiming benefits as a “dependent” husband or wife off of their spouse’s Social Security account at age 66, and then living off that smaller amount until age 70 when they switch to their own retirement account — with that added bonus. Until the law was recently changed, others were filing for reduced Social Security benefits at 62 and investing every dime of that money while they lived off of other retirement accounts. Then at age 66, they would pay back all the benefits they received and file a new claim to get full benefits from that point on. They came out ahead of the game because they were able to pocket whatever interest they earned on the benefits received between age 62 and 66. The government real ized they were essentially providing interest-free loans to wealthy retirees, so they put a stop to that practice.

Again, I am not saying that treating Social Security as an investment is bad. Whatever you get from Social Security is your money, after all. And if you want to work within the rules to get the highest return out of that money — well then, more power to you.

But I have been more than a little taken aback by the obsession some people seem to have gambling with their Social Security benefits. People who delay their Social Security until 70 are throwing away tens of thousands, some approaching one hundred thousand dollars, in Social Security benefits, betting that they will live into their mid 80s to “beat the system.” But I’ve got to wonder, even if they live that long, will they really be able to enjoy their Social Security “winnings?” Lots of folks are taking that chance. And I can tell from the tone of their emails that they’re really not sure they are making the right wager.

All of this came home very clearly to me recently after I offered my readers a copy of a fact sheet I called, “When to take your Social Security benefits.” It was intended to present people with the facts — with the advantages and disadvantages of taking reduced retirement benefits as early as 62 versus waiting until age 66, or even 70, to get full benefits. And I’m afraid I fed some people’s manic desire to gamble with their Social Security by offering some tips for “maximizing” one’s Social Security payout.

Most of my readers take this advice for what it is worth. They will sit down, perhaps with a financial planner or with someone at their local Social Security office, go over all the numbers, consider their options, and then make a rational decision based on the facts.

But some of my readers aren’t being rational. They are going way overboard. They sent me lists with dozens of different options and asked me to help them make the right choice. Some sent me matrixes. Others sent me spreadsheets with more data on them than I’ve seen in the annual reports for major corporations. One guy had figured out what he would get from Social Security in 25 different scenarios: file at 62, die at 90; file at 66, die at 85; etc. He said he was losing sleep trying to figure out what to do! A little financial planning is good. But trying to squeeze every last nickel out of the system is maybe too much?

And I noticed that almost all of the folks who sent me emails fretting over their Social Security decision were not between a rock and a hard place. They were, financially speaking, between a cushion and a soft place. No matter what they chose to do with their Social Security, they were going to be living very comfortable lives in retirement.

My wife and I both took our Social Security benefits at age 62. It might not have been the smartest decision in the world. But guess what? We don’t care. We are having way too much fun enjoying life and our retirement.

So the message to my readers is this: study the information I give you; maybe give some second thoughts to delaying benefits too long; then make a decision about when to take your Social Security that you are comfortable with — AND ENJOY THE REST OF YOUR LIFE!

If you have a Social Security question, Tom Margenau has the answer. Contact him at thomas.margenau@comcast.net. To find out more about Tom Margenau and to read past columns and see features from other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.

COPYRIGHT 2012 CREATORS.COM

Q: I want to apply for Social Security benefits on my ex-husband’s record. I called Social Security to ask how to do this. The lady on the phone told me they can’t even talk to me until I have original copies of the marriage certificate and divorce papers. I have the divorce papers but don’t have the marriage records. When I called the office of the county where we were married, the people there said they can’t send the original, only a copy. I told them that Social Security wants the original. The county employee told me, “That’s not my problem!” I’m worried I never will be able to get Social Security benefits. What am I supposed to do?

A: Don’t you just love the bureaucracy? It almost makes me embarrassed to think I was once a government employee. I said “almost” because I know — or at least I sure hope — that there are way more helpful government employees than the two lazy bumpkins you ran into.

The first thing you can do is relax. You will be able to get the marriage documents you need, and you will be able to file for Social Security benefits on your ex-husband’s record. Just reverse the order.

The second thing you need to do is go back to your local Social Security office and file a claim for benefits. You do NOT need the documents in question to start the process. The Social Security representative you talked to the first time should have offered you the opportunity to apply for divorced wife’s benefits, and then she should have said, “And now let’s help you get the marriage certificate.” And then she should have given you the address, phone number and/or website for the bureau of vital statistics in the county where you were married.

The third thing you need to do is go back to the county office and get a “certified copy” of your original marriage record. That’s what the Social Security Administration needs. A “certified copy” is essentially a photocopy or facsimile of the original document, usually with a raised seal signed by some official from the office that maintains the records.

Q: In one of your recent columns, you explained that a woman usually cannot file for reduced benefits on her own Social Security record and expect to switch to full spousal benefits on her husband’s record at age 66. But what if she becomes a widow? Here is my situation. I just recently started taking my Social Security at age 62. I’m getting $1,200 per month. My husband, who is five years older than I am, started taking his Social Security at age 66. He is getting $2,300 per month. When he dies, will I be able to switch to widow’s benefits on his record?

A: Yes, you will. In the column you referred to, I was so intent on pointing out that if you take reduced benefits on one Social Security record, you generally must file simultaneously for benefits on any other account you might be due benefits. But I should have made it clearer that if one of the spouses dies, the rules change.

As a general rule, the only deciding factor that determines how much you get on your husband’s record after he dies is how old you are when you become a widow. Assuming you are 66 or older when that happens, you will start getting whatever he was getting. Or, to be more precise, you will continue to get your own Social Security check, and it will be supplemented with widow’s benefits so that your total monthly payment equals his Social Security amount.

Q: In the past several weeks in your columns, you have made many references to a woman’s getting benefits on their husband’s Social Security account — whether it be a young woman getting monthly checks from her retired husband’s record because she is caring for his minor children or an older woman getting widow’s benefits. But you never talk about a man’s getting any benefits from his wife’s Social Security. This just doesn’t seem fair. What about guys like me? Why can’t we get Social Security from our wives?

A: Actually, Social Security law is very fair. Dependent fathers, husbands and widowers can get Social Security benefits just as dependent mothers, wives and widows do. The reason you don’t see such benefits often is society hasn’t been fair.

Everyone knows the story. Men traditionally have made more money than women. Also, women tend to spend more years out of the paid labor force staying home to care for children. Because Social Security benefits are tied directly to the amount of a person’s earnings and to the number of years a person has worked and paid Social Security taxes, those are the two main reasons men get higher monthly retirement benefits from Social Security than women do.

You can claim a dependent’s benefit from your spouse only if you are getting a significantly lower Social Security benefit than your spouse is receiving. That’s why there are millions of women getting wife’s and widow’s benefits but only a relative handful of men getting husband’s and widower’s benefits.

But apparently, times are changing. I just read a report that said that in the 20- and 30-something age group, women are now out-earning men. So perhaps three or four decades from now, we’ll see more men than women getting spousal benefits.

If you have a Social Security question, Tom Margenau has the answer. Contact him at thomas.margenau@comcast.net. To find out more about Tom Margenau and to read past columns and see features from other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.

I was all set to submit a column to my editor with reactions to the fact sheet I recently offered my readers called “When to Take Your Social Security Benefits.” But then I woke up this morning to this headline in my morning paper: “Social Security Drain is Gaining Momentum.” It was yet another news report predicting the demise of our nation’s bedrock retirement insurance program. So I’m delaying that practical column about the best time to sign up for Social Security to write a more politically-charged newspaper story dealing with the hot button issue of Social Security reform.

The latest news stories focused on a recent report issued by Social Security’s Board of Trustees, based on data compiled by Social Security Administration actuaries, that the program’s trust funds will run dry in 2033, three years earlier than the estimate in last year’s report. Lower than anticipated wages (and thus lower projected payroll tax receipts) were cited as the main reason for the sooner-than-expected funding shortfall.

This latest trustee’s report will inevitably lead to all kinds of gloom and doom stories in the media — some of them predicting catastrophic consequences for the program and its beneficiaries. Indeed, the report in my local paper said, “Unless Congress acts — and forcefully — payments to millions of Americans will be cut.”

And I know I will get emails from thousands of my readers. Some will be seriously concerned that their Social Security checks will soon be reduced. Others will make hasty and ill-advised decisions about starting their Social Security benefits (perhaps too soon) because they are worried that the rug will be pulled out from beneath them — that Social Security rules will change dramatically in the next couple of years.

My message to all concerned is to take a deep breath and calm down. Sure, Social Security has long-range funding problems — due almost entirely to the fact that baby boomers are turning into senior boomers at the rate of tens of thousands per day. But they are problems that can be dealt with in a rational and comprehensive manner. And they will be dealt with as soon as this country has the political will to take on the challenge. And I think that will is just about there.

This problem isn’t new, of course. People have known about the demographic time bomb represented by the aging baby boom generation for many years now. And most folks have been inclined to blame Congress for inaction, wondering: “Why don’t they do something to fix Social Security?”

I place a large part of the blame on the American people — on voters and our negatively-focused election process. For example, if I had run for Congress anytime in the recent past on a Social Security reform platform that called for an increase in the retirement age and a slight decrease in annual cost-of-living adjustments (two very realistic and rational reform scenarios), I would have lost the election in a landslide. My opponent would have run negative ads claiming that I was out to gut grandma’s Social Security checks.

I can envision the 30 second spot now. There would have been a picture of me taken on my worst bad hair and ugly face day, and next to me would be a sweet little old lady staring at her Social Security check in horror. A very ominous-sounding voiceover would say, “Did you know that Tom Margenau has a plan to slash our Social Security?” Then we would have seen my opponent, as handsome as the day is long, walking though a field of flowers with lots of happy and smiling senior citizens surrounding him. And you’d have heard him say, “Vote for me, Wally Wonderful. I love my grandma and I won’t touch her Social Security check with a ten foot pole.” And sadly, the voters would have bought it.

But as I said, I think the mood of the country is changing. I think folks are ready to acknowledge that we have to do something to deal with Social Security’s long-range problems.

So what can we do? I’ve used this column many times to offer some suggestions for reform. These aren’t solutions that I dreamt up. They are commonly cited proposals for dealing with Social Security’s funding problems. Even though you will hear all kinds of ideas over the next couple of years for changing Social Security — from radical right wing proposals to “privatize” the system to nonsense left wing suggestions to “leave well enough alone” — I will bet money that two or three of the following reforms will eventually be adopted and passed into law:

–A long-range increase in the retirement age, probably to age 68;

–An increase in the number of years used to compute a Social Security retirement benefit, from the current 35 year base to 38, which will have the effect of slightly reducing future retirement benefis;

–An increase in the Social Security taxable wage base, probably to $250,000;

–A long-range and small increase in the payroll tax, perhaps from the current 6.2 percent to 6.5 percent; and

–A small decrease in the annual cost-of-living-adjustment (COLA) paid to Social Security beneficiaries.

Here is one final note about the timeframe for dealing with Social Security reform. Most of my readers were in their 20s and 30s the last time the program faced a financial shortfall. This was in the late 1970s, and at the time, Social Security was only five years away from insolvency. Many of you were too young to give Social Security a second thought. But a series of amendments in 1983 set the system on the course it’s still on today, putting the system in the black for the next half century. I’m not saying we should once again wait until Social Security is five years away from bankruptcy. The sooner we deal with Social Security reform, the better. But I am saying we don’t need to panic.

If you have a Social Security question, Tom Margenau has the answer. Contact him at thomas.margenau@comcast.net. To find out more about Tom Margenau and to read past columns and see features from other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.

Sometimes I am just blown away by the reaction I get to a column. I write what I think is the most innocuous and non-controversial answer to someone’s question about Social Security benefits — and then, out of the blue, my email inbox is flooded with letters. Some of them have an inquisitive “this can’t possibly be true” tone, while others are downright angry.

The most recent example of this phenomenon occurred following a column I wrote a few weeks ago in which I answered a question from a retiree about the benefits due to his wife and children. Many readers were shocked, and some irritated, to learn that a retiree’s children and his younger wife could qualify for monthly Social Security checks on his account.

Here’s a typical response: “You must be wrong about benefits due a retiree’s children. Surely those kinds of benefits are only paid if the children are disabled.” Here is another: “I’ve always heard that children get benefits if a parent has died, but I can’t believe that they get checks if their father has retired.” And finally, one of the typical angry responses: “Why should a 55 year old woman get Social Security checks on her husband’s record? She should be working and supporting herself. And their kids don’t need money! These people really know how to milk the system. It’s just another benefit the liberals have tacked on to Social Security to appease the masses!”

It may surprise many of my readers to learn this “tacking on” was done in 1939 — just three years after the Social Security Act was signed and one year before the first monthly Social Security benefits were paid. In other words, Social Security has been paying benefits to the children of retirees, and to the mothers (and rarely fathers) of those kids, for more than 70 years now.

Many of you wondered why they would get such benefits. The original intent of Social Security was to partially replace the income that taxpayers and their legal dependents lose when they (the taxpayers) stop working — because of retirement, disability, or death. The law clearly spells out who those dependents are. It’s a spouse over age 62 who doesn’t have his or her own Social Security benefit; it’s a widow(er) over age 60; it’s a child under age 18 (or over 18 if disabled); and it’s the mother (and more recently the father) of any minor kids still at home — unless that mother or father is working, in which case the earnings penalty rules (explained many times in this column) would prevent them from getting benefits.

And for those of you who are convinced that this is just another example of the erosion of that good old “pull yourselves up by the bootstraps” American mentality, I think you should relax. These benefits are not very common. After all, there aren’t that many retirees (i.e., folks in their mid to late 60s and older) who have minor children at home.

For biological reasons, there obviously are hardly any women who have young kids at home when they reach Social Security age. It’s a different story with men, of course, especially considering that there are more than a few old goats married (usually for the second time) to a younger woman — and they might have some teeny boppers still at home when he signs up for Social Security.

But the numbers show it really doesn’t happen all that often. There are about 54 million people getting Social Security checks. Out of all those, about 579,000, or about one percent of all benefits, are going to children of retirees.

It is more likely that the children of someone getting Social Security disability checks would be getting monthly dependent’s benefits. There are 1.8 million kids getting checks on the account of a disabled parent. And there are about 2 million kids getting monthly Social Security checks because their mother or father has died.

Finally, there are about 100,000 young mothers getting Social Security from their retired husband’s account. That’s just one-tenth of one percent of all benefits paid. And you can literally almost count on your fingers and toes the number of dependent fathers getting benefits because they are caring for the young children of a retired woman.

Q. I am 68 years old. I have a 47-year-old wife, and we have a son with Down syndrome who is about to turn 18. He is getting Social Security checks on my record. We’ve heard conflicting stories about whether his benefits will continue after age 18. Can you explain the rules? (My wife doesn’t get any benefits because she is working full time.)

A. Your son’s benefits will continue indefinitely. Benefits to a dependent child normally stop at age 18, and sometime can be paid until age 19 if the child is still in high school.

But those benefits can go on for life if a son or daughter is severely disabled, and has been disabled since childhood. In fact, of the 4.3 million “children” who are getting Social Security dependent’s benefits, about 950,000 are getting what the law calls “disabled adult child” payments. “Adult” is the key word, because many of these beneficiaries are folks well into their 30s, 40s, and 50s. (Remember though, they have been severely disabled since they were kids.)

If you filed for your retirement benefits quite a few years ago, my hunch is they didn’t do any disability development for your son, since he was eligible for checks simply because he was a minor child. That means you will have to fill out some paperwork to establish his disability in Social Security’s records. If you haven’t done so already, make sure you talk to your local Social Security office about this before his 18th birthday.

  If you have a Social Security question, Tom Margenau has the answer. Contact him at thomas.margenau@comcast.net. To find out more about Tom Margenau and to read past columns and see features from other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.

Well, dear readers: do you want the good news … or the bad news? Let me get the bad news out of the way first. I’ve been working on a new fact sheet for my readers (that’s actually the good news – but more about that in a minute); and as part of my research, I’ve discovered that I haven’t been completely clear in some past columns when explaining the coordination between taking reduced benefits on your own Social Security record and any possible benefits you might be due on your spouse’s Social Security record.

A question I’m frequently asked goes something like this: “Can I take reduced benefits on my husband’s record at age 62 and then at 66, switch to full benefits on my own account?”

The answer to that question is “no.” But sometimes I’ve overstated that negative response by following up with a comment similar to this: “If you take reduced benefits on one Social Security record, you cannot later switch to full benefits on another record.”  As a politician who’s caught bending the truth might say: “That statement is no longer operational.”

Before I can clarify that, I have to explain a technical part of Social Security rules called the “unrestricted application policy.” That means that an application for any kind of reduced Social Security benefit is automatically an application for all other Social Security benefits a person might be due. Because most people are usually due benefits from only two accounts — their own and a spouse’s — in practical day-to-day use, the policy is saying that if you apply for your own Social Security benefit before age 66, you are automatically applying for spousal benefits at the same time. Or the reverse is also true: if you are applying for reduced benefits on a spouse’s Social Security record, you are simultaneously applying for your own Social Security.

But here is something I didn’t make clear in my prior columns. If your spouse is not yet getting Social Security when you apply for benefits, then you can claim spousal benefits later when your husband or wife signs up for Social Security. And you will get whatever spousal rate you are due based on your age at the time (e.g., 50 percent at age 66; about 40 percent at age 64, etc.). But the reduction you took on your own Social Security record will still impact your overall benefits.

Here is a simple example of how that works. Becky files for her own retirement benefits at 62. Her full (age 66) rate is $1,000, but she is getting $750 per month in reduced retirement benefits. Her husband, Tom, is also 62, but he does not plan to file for Social Security until age 66. When he turns 66, he starts getting $2,400 in full retirement payments. At that point, Becky can file for wife’s benefits. To figure her rate, the Social Security Administration will take her full age 66 benefit, or $1,000, and subtract that from one-half of Tom’s full benefit, or $1,200. So, $1,200 minus $1,000 leaves $200. That $200 would be added to Becky’s reduced retirement benefit of $750, giving her total benefits of $950 per month.

And please note: the “unrestricted application rule” does NOT apply to widows and widowers. For example, a woman can take reduced widow’s benefits as early as age 60, and then at age 66, switch to full retirement benefits on her own Social Security account. Or, she can wait until age 70 and get full benefits plus a 32 percent “delayed retirement bonus.”

Also, the “unrestricted application rule” does not apply if you wait until 66 or later to file for Social Security. For example, if you are 66, you could apply for spousal benefits on your husband or wife’s account, and then at age 70, file for your own retirement benefits and get your full rate plus that 32 percent bonus mentioned above.

So now: back to my new fact sheet.  There is no question I am asked more often than this one: “When should I start my Social Security?” Another version of that question goes like this: “Should I take my Social Security at 62 … or wait until age 66 or even age 70?” As I’ve pointed out so many times in this column, that is almost an impossible question to answer because there are so many potential variables. And the biggest variable of all is your life expectancy. I could give you a very good answer to that question if you could give me an answer to this question: “Exactly when are you going to die?” And because no one really knows the answer to that question, no one really knows when it would be the best time to start one’s Social Security benefits.

And some of the many other variables include your anticipated earnings (if you are under age 66, an earnings penalty can reduce your Social Security benefit payments) and, as discussed in the first half of this column, your potential eligibility for benefits on a spouse’s Social Security record.

To help readers decide when to take their Social Security benefits, I’ve written this new fact sheet. It discusses all the variables. It explains the earnings penalty rules; it clarifies benefits you might be due as a spouse; and it offers several strategies for “maximizing” your Social Security benefits.

As always, I make these fact sheets available free of charge to my readers. If you want a copy, simply send an email to me at thomas.margenau@comcast.net. Because I’ve written so many fact sheets, please specify that you want the new one titled, “When to take your Social Security benefits.”

If you have a Social Security question, Tom Margenau has the answer. Contact him at thomas.margenau@comcast.net. To find out more about Tom Margenau and to read past columns and see features from other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.

COPYRIGHT 2012 CREATORS.COM

Q: I read your article explaining that SSI is not a Social Security benefit and is not paid for out of Social Security taxes. But I’m still confused. What is the difference between Social Security disability and SSI disability? And how are they different from regular Social Security?

A. I’m always puzzled when people differentiate between Social Security disability benefits and “regular Social Security.” Does that mean that the Social Security disability program is some kind of “irregular” benefit? The answer to that question is “no.” Social Security disability is a regular Social Security benefit, just like the retirement program. So, now let me clarify the difference between Social Security and Supplemental Security Income, or SSI.

First, let’s discuss Social Security. Most people in this country understand how it works. You have a job, you pay taxes, and that’s what qualifies you for monthly benefits.

There are basically three parts to the Social Security program: retirement benefits, disability benefits, and survivor benefits. You get Social Security retirement benefits once you are 62 or older. Your family (usually a spouse and minor children) get Social Security survivor benefits if you die. And you get Social Security disability benefits if you become disabled before reaching retirement age.

So, the Social Security disability program is just one kind of Social Security benefit. People who get Social Security disability benefits have worked and paid taxes. They just didn’t stay healthy enough to make it to retirement age. In effect, a Social Security disability benefit is like “disability retirement.”

And then there is Supplemental Security Income, or SSI. SSI is a federal welfare program run by the Social Security Administration but NOT paid for out of Social Security taxes. There are two ways you can get SSI. You qualify for monthly SSI payments either because you are old (over 65) and poor; or if you are under 65 but disabled and poor. In other words, there are SSI benefits for the aged, and SSI benefits for the disabled. Unlike Social Security, there is no requirement to work and pay taxes to qualify for SSI. SSI is what it is — a welfare program.

So, to repeat: you get Social Security disability, which is a “regular” Social Security benefit, if you have worked and paid taxes, and become disabled before being old enough to get Social Security retirement benefits. And you get SSI disability benefits if you are poor and become disabled.

Here’s another way to look at it. If Bill Gates became disabled tomorrow, he would qualify for Social Security disability benefits because he’s worked and paid taxes. But he would never ever be eligible for SSI because he certainly isn’t poor.

Q. I am 60 years old and have already retired. But I wasn’t planning to apply for my Social Security benefits until I am 66. However, someone told me that if I haven’t worked in the five years prior to applying for Social Security, I won’t be able to get benefits. Is this true?

A. No, it is not true. As long as you have 40 Social Security work credits (sometimes called “quarters of coverage”), you will always be eligible for Social Security retirement benefits.

There is a recent work requirement for the Social Security disability program. Specifically, the law says you must have worked in five of the last 10 years before filing for Social Security disability benefits.

But you are not interested in disability. You are interested in retirement. And there is NOT a five-year recent work rule for the Social Security retirement program. So, you can relax and enjoy your retirement. And you will certainly be able to collect your Social Security checks when you turn 66.

Q. I just learned my ex husband has died. A neighbor told me I am eligible for some of his Social Security. Is this true?

A. Gosh, there are so many “ifs, ands or buts” associated with your potential eligibility for divorced widow’s benefits, I simply won’t be able to give you a definitive answer. But I can give you some general information. All of the “ifs” you see in this little explanation illustrate the many variables there are to your possible entitlement to these benefits.

IF you were married for more than 10 years; and IF you haven’t remarried; or IF you remarried but that subsequent marriage has ended; and IF you are at least 60 years old and not working; or IF you are working but not making much more than $14,000 per year; of IF you are working full time but are at least age 66; and IF you are not due higher benefits on your own Social Security record, then you possibly might be due divorced widow’s benefits from your ex husband’s account.

The only way you will know for sure if you are eligible for anything is to contact Social Security at 800-772-1213.

If you have a Social Security question, Tom Margenau has the answer. Contact him at thomas.margenau@comcast.net. To find out more about Tom Margenau and to read past columns and see features from other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.

COPYRIGHT 2012 CREATORS.COM

Q: I am 67 years old. I took my Social Security at age 66. I have a 17-year-old son, a 14-year-old daughter and a 57-year-old wife. All three of them are getting benefits as dependents on my account. The Social Security office told me that my kids will keep getting checks until age 19. And my wife will get Social Security until the youngest one turns 19. But by then, she will be 62, so she will be able to get regular wife’s benefits at that point. They also said the total amount we are getting now will never change. Is all of that true?

A: No, it’s not true. You either misunderstood what the Social Security people were telling you or got some bum advice. I’m going to assume the former because the rules involving benefits paid to a family can get quite messy and are not easy to follow. But I will try to explain it as simply as possible.

I’ll start with a couple of basic Social Security principles. As someone who has worked and paid taxes, you obviously are due your retirement benefit. Your children qualify for benefits until they reach age 18 (not 19). If they are still in high school on their 18th birthday, their benefits can continue until they graduate or turn 19, whichever comes first.

Your wife qualifies for what are known as “mother’s benefits” until the youngest child turns 16. Based on what you told me, she will be 59 when that happens. At that point, her mother’s benefits will stop. But when she turns 62, she then can file for regular dependent wife’s benefits on your record.

Now let’s look at how everyone’s benefits will play out as the years go along. You didn’t tell me what you are getting. So to help explain, let’s say your full age 66 retirement benefit is $2,000 per month.

Yours is the easy one. You waited until 66 to take your Social Security. So you should be getting your full retirement benefit of $2,000 per month. You will get that for the rest of your life (with annual cost-of-living increases, of course).

Technically, each of your dependents is due 50 percent of your retirement rate. So normally, each of them would get $1,000 per month. That would come out to a total of $5,000 per month payable to you and your family.

But the law sets a maximum level that can be paid to a family. That family maximum rate is usually 175 percent of your retirement amount. Based on a variety of circumstances, it could come out to slightly more or less than that. But to keep this explanation simple, let’s assume that 175 percent of your retirement rate is the most that can be paid to you and your family.

That means the maximum dollar amount that can be paid to all of you is $3,500 per month ($2,000 times 1.75 equals $3,500). Your own retirement benefit is never impacted by the maximum family rate. So out of that $3,500, you always will get your retirement payment of $2,000 per month. That leaves $1,500 per month to be divided among your wife and two children. So right now, each should be getting about $500 per month.

When your son turns 18 in another year, he will be dropped from the rolls. That leaves two dependents (your wife and daughter) to split $1,500, so each will get $750 per month. Your family still is getting the family maximum total of $3,500 monthly.

When your daughter turns 16 in two years, your wife will lose her “mother’s benefits,” and she’ll be taken off the rolls. (Again, your wife will be 59 at the time, so she’s not old enough to qualify for regular wife’s benefits.) Now the family maximum rate is no longer an issue. At this point, you will have only one dependent (your daughter) getting benefits. And the most she can get is 50 percent of your rate, meaning she will get $1,000 per month. So once your daughter is the only dependent on your account, you will be getting total monthly benefits of $3,000 ($2,000 for you and $1,000 for her).

And in about four years, when your daughter turns 18, she no longer will be eligible for dependent child’s benefits. So then we will be down to just you — getting your $2,000-per-month retirement check.

And finally, about five years from now, when your wife turns 62, she can come back on the rolls, getting a dependent wife’s benefit on your account. At 62, she’d get a reduced benefit, equal to about 30 percent of your rate, or about $600 per month. Your wife could choose to wait until 66 to apply for wife’s benefits, at which point she’d get half of your benefit, or $1,000 monthly.

And we could take this one more step. Someday, obviously, you are going to die. And assuming you die before your wife does, she will then begin getting widow’s benefits on your account. And her widow’s rate depends only on how old she is when that happens. Assuming she is 66 or older when you die, she will get 100 percent of your benefit as a monthly widow’s payment.

If you have a Social Security question, Tom Margenau has the answer. Contact him at thomas.margenau@comcast.net. To find out more about Tom Margenau and to read past columns and see features from other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.

COPYRIGHT 2012 CREATORS.COM

Q: You recently wrote a column in which you called the “notch” a hoax and a scam. I want you to know that you are wrong. At one time, there were millions of us who were cheated out of Social Security benefits that were rightfully ours. There aren’t so many of us left, because the government is willing to let us slowly die off without ever compensating us. But there still are enough of us out here who demand justice. Why don’t you help us get what’s coming to us rather than mock us?

A: I wasn’t mocking you in that recent column. Instead, I was doing what I always try to do — take on all the rumors and myths about Social Security and set the record straight.

I’ve discussed the so-called “notch” issue dozens of times over the past 15 years I’ve been writing this column. But I guess it’s time to trot out my arguments one more time to help people understand this perplexing subject.

For those readers who don’t have a clue what we are talking about, the “notch” refers to a time period when corrections were made to the Social Security benefit formula — corrections that were necessary to ensure that all Social Security recipients were paid properly but corrections that were misconstrued by many to be a way of cheating them out of benefits they felt they were due. Here’s the story.

In 1972, Congress passed a law mandating automatic annual cost-of-living adjustments, or COLAs, to Social Security checks. Those COLAs were to be based on increases in the consumer price index, which is the government’s official inflation measuring stick. (Before 1972, COLAs were not automatic. They were sporadic and happened only if Congress specifically authorized a yearly increase.)

As part of the new process, the Social Security Administration had to come up with a formula for calculating increases to people’s Social Security checks — which it did. But after COLAs were paid for a couple of years, someone noticed the formula was wrong. Social Security beneficiaries were getting increases that were slightly higher than intended.

Once the mistake was discovered and the SSA notified Congress, several decisions had to be made. For one, they had to figure out what to do about all of the Social Security beneficiaries who had received the overly generous COLA adjustments. Congress decided to let them keep the money. (It would have been political suicide to send “overpayment” letters to every senior citizen in the country demanding repayment of the incorrectly paid funds.)

The second choice members of Congress had to make was to decide where to draw the line — to figure out which people would have their benefits figured using the proper COLA formula. And they drew that line at 1918. In other words, they said everyone born in 1918 or later would have his or her Social Security benefit figured using the corrected formula.

Sounds simple enough, doesn’t it? But sometimes Congress can’t leave well enough alone. In this case, Congress bowed to pressure from senior groups that demanded a transition period from the old (incorrect) formula to the new (proper) formula. After lots of haggling, it eventually was decided that everyone born between 1918 and 1921 would have his or her benefit figured using a special formula that wasn’t quite so generous as the incorrect one but that paid a higher COLA adjustment than everyone born from 1922 onward would get.

You’d think everyone would be happy, right? Well, what happened next was pretty bizarre. Social Security recipients born in 1918 or later started to complain that they weren’t getting quite so much as folks born in 1917 or earlier. Someone should have splashed some cold water in their faces and said, “Duh, you are being paid correctly. It’s the folks born before 1918 who are getting overly generous benefits.”

Instead, mobs of angry seniors across the country started to form into groups demanding “justice.” They mistakenly thought they were singled out for lower benefit adjustments than everyone else. In truth, they were getting slightly lower benefits than people born in 1917 or earlier, but they were getting higher benefits than everyone born in 1922 or later.

So, to repeat: People born after 1921 have their benefits figured using the proper COLA formula; people born before 1918 have their benefits figured using the incorrect (and slightly more generous) formula; and people born between 1918 and 1921 have their benefits figured with a special formula that is not quite so generous as the one the pre-1918 crowd enjoys but is more generous than the one the post-1921 crowd gets.

Then lobbying groups got into the mix and really muddied things. They sent letters to folks born in the so-called “notch years,” which they expanded to include everyone born between 1918 and 1926, telling them they were being cheated out of Social Security benefits and asking for donations to “fight this injustice.” Seniors sent in tens of millions of dollars — money that paid for many overpriced lobbyists and some pretty nice office space on K Street in Washington but money that accomplished nothing else. After all, there really was no “injustice” to fight.

Sadly, millions of seniors born between 1918 and 1926 went to their graves bitter and disappointed. Those still alive believe to this day that they are being cheated out of Social Security benefits. Shame on all those folks who perpetrated and perpetuate this dishonorable scam.

If you have a Social Security question, Tom Margenau has the answer. Contact him at thomas.margenau@comcast.net. To find out more about Tom Margenau and to read past columns and see features from other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.

COPYRIGHT 2012 CREATORS.COM