Does My Husband Want To File Retroactively To 2021 For Social Safety’s 5.9% 2022 COLA?


As we speak’s Social Safety column addresses questions on whether or not the 2022 5.9% COLA applies to advantages filed for after December 2021, when one kid’s profit cessation can enhance one other kid’s advantages and when the Windfall Elimination Provision (WEP) may not be utilized. Larry Kotlikoff is a Professor of Economics at Boston College and the founder and president of Financial Safety Planning, Inc.

See extra Ask Larry solutions right here.

Have Social Safety questions of your individual you’d like answered? Ask Larry about Social Safety right here.

Does My Husband Want To File Retroactively To 2021 For Social Safety’s 5.9% 2022 COLA?

Hello Larry, Our plan had been that my husband accumulate his Social Safety retirement profit at 70 in June 2022. Is there a bonus to claiming retroactively to final 12 months in November or December to take benefit a the massive price of residing enhance. He’s not working so no benefit in amassing based mostly on present earnings.

I do not flip 70 till November of this 12 months. When he does declare, ought to I accumulate a spousal profit after which may I obtain my very own increased profit after I flip 70 and will probably be increased? Thanks, Marcia

Hello Marcia, The reply to your first query isn’t any. Your husband will obtain credit score for the 2022 5.9% price of residing (COLA) enhance no matter whether or not he begins drawing advantages this 12 months or final 12 months retroactively.

And the reply to your second query is sure. Because you had been born previous to 1/2/1954, you could possibly file a restricted utility for simply spousal advantages solely when your husband begins his advantages, and you could possibly then apply to change to drawing your retirement advantages at 70.

You and your husband might wish to think about using my firm’s software program — Maximize My Social Safety or MaxiFi Planner — to make sure your family receives the best lifetime advantages. Social Safety calculators supplied by different corporations or non-profits might present correct solutions in the event that they had been constructed with excessive care. Finest, Larry

Will My Daughter’s Advantages Be Redistributed To My Son When She Turns 18?

Hello Larry, Each my kids obtain survivor advantages from their father who handed earlier this 12 months. They’re the one 2 survivors to obtain advantages on his file. When my daughter turns 18, what is going to occur to her portion of the advantages? Will the funds be redistributed to my son? Thanks, Cheryl

Hello Cheryl, I am sorry to your loss. Your son’s profit charge won’t go up when your daughter’s advantages cease. The utmost surviving kid’s profit charge is the same as 75% of the deceased employee’s major insurance coverage quantity (PIA). As much as two surviving kids can all the time be paid their full most profit charge if they’re the one survivors drawing advantages on a deceased employee’s file.

The one time {that a} surviving kid’s profit quantity is diminished under 75% of the employee’s PIA is that if there are greater than two eligible kids, or not less than two eligible kids plus a surviving partner drawing advantages. In that case, they need to break up the household most profit (FMB

) quantity that may be paid on the employee’s file.

So your son’s profit charge will not go up when your daughter’s advantages finish as a result of he is apparently already being paid his most charge of 75% of his father’s PIA. The one occasions {that a} kid’s profit goes up when one other baby stops getting advantages is that if their profit charges had been diminished because of the FMB. Finest, Larry

Is It Appropriate That I Would not Have A WEP Deduction If My Pension Ends Earlier than My Social Safety Funds Begin?

Hello Larry, I’ve been contributing to each Social Safety and a non-covered pension, Calstrs. The non-covered pension is in a money steadiness plan that enables me to take the profit as a 3 to 10 12 months time period annuity.

I used to be advised by my native Social Safety workplace that if I wait to start out amassing Social Safety till after the annuity from Calstrs ends, I will not have a WEP discount of my Social Safety profit. Is that this appropriate?

For instance, if I start amassing my Calstrs 5 12 months annuity at 58 and do not begin amassing Social Safety till 65, will I nonetheless have a WEP deduction? Thanks Sean

Hello Sean, Sure, it appears like what they advised you is appropriate based mostly in your description. Principally, any Windfall Elimination Provision (WEP) discount would solely apply in months that you just’re paid each Social Safety retirement or incapacity advantages and a non-covered pension.

Generally, although, the WEP can nonetheless apply even after an individual stops receiving funds from their pension plan in the event that they obtain a lump-sum cost in lieu of a pension. Within the case of lump sum funds, Social Safety prorates the lump sum over interval of years.

Nonetheless, in case your pension is simply payable for a set variety of months or years and if that interval ends earlier than you begin drawing your Social Safety advantages, then the WEP would not apply to your profit charge.

Remember, although, that I am basing my reply solely on the restricted info in your query. If there’s something I am unaware of with regard to your pension choices, that might change how Social Safety would deal with your pension for WEP functions. Finest, Larry


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