Social Security: What You Need to Know
In July 2024, Brandon Oliver of Arcwood Financial LLC. and David Riley of Strategy Financial Group created the following video to provide a high-level overview of Social Security benefits for Arcwood Financial 401k participants and client employees. This video covers key topics such as sources of income in retirement, Social Security benefits at retirement, early retirement and delayed retirement, earnings caps, coordinating benefits for married couples, and spousal/survivor benefits. For a deeper understanding of what could be your largest source of retirement income, please take a few moments to watch the video and explore the links below.
Summaries and Links to some of the information covered
Social Security Retirement Income Calculators
- Quick Calculator
- Provides rough estimates of your retirement benefit based on your current earnings. Also provides estimated disability and survivor benefits if you die or become disabled today.
- Online Calculator
- To use the Online Calculator, you must have a copy of your earnings record because you will need to enter your covered earnings for each year. This calculator is more accurate than the Quick Calculator. (The Online Calculator requires that your browser be JavaScript-enabled.)
- A special-purpose version of the Online Calculator provides benefit estimates under the Windfall Elimination Provision (WEP) for those who receive a pension from work not covered by Social Security. None of the calculators listed above can provide such benefit estimates.
Early or Late Retirement
Retirees looking to receive Social Security benefits have three options: they can retire at their normal retirement age, take early retirement (which decreases their monthly benefits), or opt for delayed retirement (which increases their monthly benefits).
Early retirement reduces benefits
In the case of early retirement, a benefit is reduced 5/9 of one percent for each month before normal retirement age, up to 36 months. If the number of months exceeds 36, then the benefit is further reduced by 5/12 of one percent per month. For example, if the number of reduction months is 60 (the maximum number for retirement at 62 when normal retirement age is 67), then the benefit is reduced by 30 percent. This maximum reduction is calculated as 36 months times 5/9 of 1 percent plus 24 months times 5/12 of 1 percent.
Delayed retirement increases benefits
Delayed retirement credit is generally given for retirement after the normal retirement age. To receive full credit, you must be insured at your normal retirement age. No credit is given after age 69.If you retire before age 70, some of your delayed retirement credits will not be applied until January after you start benefits. The calculator below gives you the amount with all credits applied for comparison purposes.
Calculator link: Social Security Calculator for early or delayed retirement
The Old-Age and Survivors Insurance (OASI) Trust updates 2024
The 2024 Social Security Trustees Report, released in May 2024, showed a slight improvement in the program’s financial outlook, but the retirement trust fund is still projected to be depleted by 2033.
The Old-Age and Survivors Insurance (OASI) Trust Fund is projected to be unable to pay full benefits starting in 2033. If the fund runs out, Social Security will only be able to pay 79% of scheduled benefits to seniors and their families.
Article link: Social Security Trustee Summary 2024
Ex-spouse and family Social Security Benefits
A divorced spouse may be eligible to receive Social Security benefits based on their former spouse’s work history if they meet certain requirements:
- The marriage must have lasted at least 10 years
- The divorced spouse must be at least 62 years old
- The divorced spouse and their former spouse must be divorced for at least two – years, or the former spouse must already be receiving retirement benefits
- The divorced spouse must not be remarried
Article links:
To learn more contact your local Social Security office or call their toll-free number at: 1-800-772-1213
Meeting Requests
As always, we understand every situation is different and you may have specific questions about your retirement investments or savings strategies. If you would like advice on either of these subjects, please email Arcwood at: retirement@arcwood.com or David Riley at: driley@strategyfinancialgroup.com to set up a free one-on-one retirement review meeting.
This information is not intended as tax, legal, investment, or retirement advice or recommendations, and it may not be relied on for the purpose of avoiding any federal tax penalties. You are encouraged to seek guidance from an independent tax, legal professional or social security administrator. The content is derived from sources believed to be accurate. Neither the information presented, nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. This material was written and prepared by Broadridge Advisor Solutions. © 2024 Broadridge Financial Solutions, Inc. Arcwood Financial, LLC., Arcwood Benefits Consulting, Inc., and Arcwood HR, LLC. (dba Arcwood) are independent companies. Arcwood does not offer legal, tax or compliance advice. Brandon Oliver is an Investment Advisor Representative offering Advisory Services through Arcwood Financial LLC. a registered Investment Advisory Firm.
