1. Providing guidance and assistance to the American public in making decisions on their Social Security eligibility and continuing Social Security issues. Stan Fromuth & Joe Olenski www.socialsecurityretirementconsultants.com

2. Qualifications – Stan Fromuth & Joe Olenski Former employees of the Social Security Administration Retired with 76+ years of service with agency Regarded as program and policy experts on Social Security issues Both involved in writing and interpreting Social Security policies and procedures Both spent many years as District Managers working directly with public on Social Security issues and problems

3. Why do people need assistance and guidance in making decisions related to Social Security? 1.Social Security programs are very complex 2.Avalanche of baby boomers becoming eligible for Social Security benefits is overwhelming the Social Security Administration 3.Changes in Social Security Regulations make it more difficult for applicants/beneficiaries to amend their decisions 4.YOU MAY LOSE A SIGNIFICANT AMOUNT OF MONEY IF YOU FAIL TO MAKE THE BEST DECISIONS

4. Maximizing Your Social Security Benefits

5. Considerations for Filing The decision of when to begin Social Security benefits is an individual one based on the individual’s unique circumstances. There is no “one size fits all option” that applies

6. 3 Requirements for Entitlement to Social Security Retirement Benefits 1.You have worked long enough under Social Security covered employment 2.You have attained retirement age 3.You are retired within the meaning of the Social Security Act

7. Insured Status Requirement Measured using a provision called “quarters of coverage” In 2016, you earn one quarter of coverage for every $1260 you earn You need 40 quarters of coverage (~10 years of work) to qualify for a benefit

8. Attainment of Retirement Age Full unreduced benefits are paid at Full Retirement Age (FRA) FRA is based on your year of birth Benefits can begin as early as age 62 If you begin receiving benefits prior to attaining FRA, your retirement benefit amount will be permanently reduced

9. Full Retirement Age Year of Birth 1943 – 1954 1955 1956 1957 1958 1959 1960+ FRA 66 66 + 2 months 66 + 4 months 66 + 6 months 66 + 8 months 66 + 10 months 67

10. ‘Retired’ Within the Meaning of the SS Act You do not need to stop working to be considered “retired” for Social Security purposes Social Security has set up certain income limits to determine if or to what extent an individual is retired The income limits depend on your age

11. Full Retirement Age and Older At full retirement age, individuals can receive their Social Security benefits no matter how much they earn

12. In the Year of FRA Attainment and for Months Prior to Attaining FRA Individual reaching FRA in 2016 Can earn up to $41,880 during the months prior to the month they reach FRA with no effect on their Social Security benefit If earnings exceed the $41,880 limit in months prior to the month they reach FRA, $1.00 in benefits will be withheld for every $3.00 earned over the limit

13. Example An individual attains FRA in April 2016. He will work entire year and earn $120,000 ($10,000 per month) He can receive a check for every month in 2016. He is due a check for all months beginning in April because he attains FRA in April. He is due a check for January, February and March because his earnings for those months ($30,000) are below the $41,880 allowable limit. Q A In which months can he receive a Social Security check?

14. In the Years Prior to the Year of Attaining FRA In 2016, individuals under FRA for the entire year Can earn up to $15,720 during the year with no effect on their Social Security benefit If earnings exceed the $15,720 limit, $1.00 in benefits will be withheld for every $2.00 earned over the limit

15. Example A 64-year-old worker has been receiving Social Security Retirement benefits of $1,000 per month. He returns to work in January 2016 and will earn $30,000 in 2016. Yes Q A Can he receive any Social Security benefits for 2015? Earnings $30,000 Less Allowable Limit – $15,720 $14,280 over the limit Social Security withholds $1 for every $2 over the limit. $14,280 divided by 2 = $7,140 The worker will receive all his Social security benefits except for the first $7,140.

16. Amount of your Social Security Benefit Benefit amount is computed using your highest 35 years of earnings The higher your earnings, the higher your SS benefit Average benefit for a retired worker in the U.S. – $1341 Maximum benefit for individual attaining FRA in 2016 – $2639

17. Increases in the Retirement Benefit Amount Cost of living increases Additional work and earnings Delayed Retirement Credits 2/3% of 1% increase per month (8%/year) Beginning with FRA up to age 70 Change in the reduction factor

18. How to Maximize Retirement Benefit Maximize your earnings and work as long as you can Do not take reduced benefits prior to FRA Defer taking retirement benefits until age 70 If you are eligible, collect spouse’s benefits or survivor benefits prior to FRA or age 70 Other pertinent issues (children, health, income needs, quality of life issues)

19. Issues Affecting The Decision to Maximize Benefits Pertinent issues to consider Children Health Income needs Quality of life issues

20. Taxation of Social Security Benefits If you file your tax return as an individual and your combined income* is: <$25,000 $25,000-$34,000 >$34,000 no part of your SS benefit is taxable up to 50% of your SS benefits may be taxable up to 85% of your SS benefits may be taxable Part of your Social Security benefits may be taxable

21. Taxation of Social Security Benefits If you file your tax return as a couple and your combined income* is: <$32,000 $32,000-$44,000 >$44,000 no part of your SS benefit is taxable up to 50% of your SS benefits may be taxable up to 85% of your SS benefits may be taxable Part of your Social Security benefits may be taxable

22. *Definition of Combined Income Your “combined income” is: Your adjusted gross income Your non-taxable interest ½ of your Social Security benefits + +

23. Other Issues Relating to Monthly Benefits Multiple Entitlements – receive only the amount of the highest benefit Family Maximum Limitation and Divorced Spouse Affect on Family Max Deemed Filing for Reduced Benefits No Deemed Filing at FRA provided individual is at least 62 before January 2, 2016 Independently Entitled Divorced Spouses No Deemed Filing In Widows/Widowers Claims File and Suspend

24. Filing for Benefits 4 months prior to entitlement On-line Face-to-face at local office By phone Make an appointment! Call 1-800-772-1213

25. Restricting Application for Other Benefits to Exclude Retirement Benefits Can only be done for spouse’s benefits when the applicant is at least FRA and has attained age 62 prior to January 2, 2016. Can be done at any age for widow’s benefits Reason for exclusion is to increase the value if the individual’s own retirement benefit.

26. How to obtain information and/or contact the Social Security Administration www.socialsecurity.gov 1-800-772-1213

27. SSRC & Q A

28. www.socialsecurityretirementconsultants.com