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About Howard Kossover

I am the Social Security Public Affairs Specialist for North Dakota and western Minnesota. Based in Grand Forks ND, I work with organizations, government agencies and businesses concerning all aspects of the Social Security programs.

America Saves Week 2015

America Saves Week, February 23 – 28, 2015, reminds us all to focus on the importance of saving and investing for the future. The Social Security Administration is one of many public and private organizations participating in America Saves Week.

Steps toward achieving financial goals include saving, investing and planning throughout an entire career.

What is the status of your savings? According to the America Saves Week website, www.americasavesweek.org/, you should assess your savings annually to make sure you are saving for all the right things and it provides several questions to help you do this.

Someday you will want to retire. Prepare for it. Now is the perfect time to examine your saving habits. Are you on track for a comfortable retirement?

Estimate your future SSA retirement amount with the Social Security online Retirement Estimator, one part of the SSA Retirement Planner. The Estimator connects to your actual work record to provide a personal estimate. You can change the default estimates for those more in tune with your actual plans.

Create a my Social Security account and view your Social Security Statement. Along with your Social Security earnings record, the Statement provides estimated retirement amounts plus family benefits should you become disabled or die. This information helps you arrange other parts of your financial planning.

Social Security personnel cannot assist with financial planning. Select your own helpers for this. Two websites to help you get started are www.mymoney.gov, the official U.S. government website dedicated to teaching Americans the basics of finances, and the Ballpark Estimator at www.choosetosave.org/ballpark, part of the American Savings Education Council program, which includes the Social Security Administration.

These sites, and others like them, are not just about savings for retirement. There are reasons to save for every stage of life.

To help your planning, here is a Test Your Savings Knowledge question from the American Saves Week website:

Q: About how much more do families with a savings plan save than those without such a plan?

A: According to one study, if family incomes are the same, those families with a plan save about twice as much as those who do not have one.

SSA office hours to increase on March 16

Effective March 16, 2015, Social Security local offices across the nation will expand their hours. Offices will be open for an additional hour on Mondays, Tuesdays, Thursdays, and Fridays, providing face-to-face service until 4:00 pm. Offices will continue to close at noon every Wednesday so employees have time to complete current work, reduce backlogs, and continue training new employees.

Some small offices will continue to have different hours. Specific office information is in the Contact Us section of the Social Security website, www.socialsecurity.gov.

This expansion of office hours reaffirms our commitment to providing the people we serve the option of top-notch, face-to-face assistance in field offices even as we work to expand online services for those who prefer that flexibility,” said Carolyn W. Colvin, Acting Commissioner of Social Security. “The public expects and deserves world-class customer service and thanks to approved funding, I am pleased we will continue our tradition of exceptional service.

Most Social Security business does not require a visit to a local office. You can apply for retirement, disability, and Medicare benefits, replace a Medicare card, and create a my Social Security account to get benefit verification letters and change addresses, telephone numbers, or direct deposit information, all online. These services are open to you anytime at www.socialsecurity.gov.

Should I file for early retirement to get benefits for my child?

Q: I am near age 62 and have a daughter, age 16. If I start Social Security retirement, can she receive benefits? Is doing this a good idea?

A: If you start Social Security retirement, at age 16 your daughter should be eligible to receive benefits through your record. Information about benefits to children is at www.socialsecurity.gov/pubs/EN-05-10085.pdf.

Deciding whether starting your retirement benefits at age 62 in order for her to be eligible is completely up to you. Are you ready to retire? Does this fit your overall retirement planning?

On the plus side, payment to a child or any other family member does not reduce your own amount. Your amount, based on earnings history and age when starting benefits, is the same whether or not other family members receive through your record. In this situation, your retirement plus a separate benefit for her would be payable. On the negative, starting your Social Security retirement at age 62 or anytime younger than full retirement age (FRA), for you age 66, gives you a permanently reduced benefit amount.

Estimate your own retirement amounts at the Retirement Planner section (www.socialsecurity.gov/retire2/) of the Social Security website. For the following example, assume that your full retirement age amount is $2,000 per month. Starting your benefits when first eligible at 62 reduces this to 75 percent giving you a monthly amount of $1,500. Future cost-of-living increases will increase this but the 25 percent reduction is permanent.

As the only eligible child, your daughter’s benefit amount is one-half of your full retirement amount, not one-half of your actual benefit amount, so she is eligible for $1,000 per month until age 18, perhaps longer if she is still in high school at age 18.

Ideally, you will be enjoying your retirement for many years. Based on your long-term financial plans, is it wise to choose a permanent twenty-five percent reduction in your SSA retirement in order to have your daughter receive benefits for a year or so? If considered as part of your individual retirement financial planning, either starting now or waiting could be good. The choice is yours.

 

Why is school information asked on a disability application?

Q: The online Social Security disability asked for my school background. Why does this matter if my doctor says I am disabled? 

A: There are two basic areas considered when someone applies for Social Security disability. First, they must have worked long enough and recently enough to be insured. Second, they must meet the Social Security definition of disability. Asking about school and work experience helps determine if a person meets the disability definition. 

The definition of disability for Social Security is different than other programs. No benefits are payable for partial or short-term disability. 

The disability definition emphasizes ability to work. In addition to the work requirement, to be found disabled under Social Security rules you cannot do the work that you did before, you cannot adjust to other work because of your medical conditions, and your disability has lasted or is expected to last for at least one year or expected to result in death. Age, work experience and education are considered in the decision.  

You are asked about your work experience and education to help determine your ability to work. Making this decision follows a national step-by-step process. Opinions of your doctor and other medical providers are important but generally only one part of making a decision.  

Broadly speaking, two people with the same medical condition might receive different decisions based on their age, work experience or educational backgrounds. For example, compare someone age 50 having a high school diploma and work experience involving heavy lifting to someone age 30 with a college degree and a desk job. The ability of each to do work previously done, or to adjust to new work, could be very different and result in different decisions for the same medical condition.

This is a broad example. There are injuries and illnesses that are routinely approved based on medical diagnosis alone. 

Learn more or file an application at the Disability section of the Social Security website, www.socialsecurity.gov.  From there, go to the Disability Planner section. 

In the Disability Planner, learn how you qualify for Social Security disability benefits including work requirements, disability definitions and the steps followed in making the decision.   

Completely different from Social Security retirement, survivors and disability programs, Social Security administers the need-based Supplemental Security Income (SSI) program, also having disability benefits.  

You do not need to start SSA retirement when you retire

Q: Do you get full Social Security benefits if you retire early but do not actually start SSA retirement benefits for several years until reaching full retirement age (FRA)? I was born in 1965 so my retirement FRA will be 67, but I have no intention of working that long and plan on not needing those Social Security benefits right away.

A: The amount of your Social Security retirement is partly based on when you start those benefits, not when you stop working. You can retire without starting Social Security. Each month of delay in the start of Social Security retirement, up to age 70, provides a higher amount.  

There is no one best time to start Social Security retirement. Decide when to do so as part of your overall retirement planning. The Social Security Retirement Planner section has lots of information and calculators to help you. 

Much can change in both your life and Social Security legislation by the time you are age 67. Keep informed of future program changes.

Social Security trust funds

Discussion about the future of Social Security and the trust funds are often part of my classes. While I cannot predict the legislative future, the Social Security website, www.socialsecurity.gov, has an entire section devoted to the trust funds located in the Solvency section or directly here. 

Two separate trust funds exist, with each started to address different parts of Social Security near the time they were enacted. They are the Old Age and Survivors Insurance (OASI) Trust Fund established in 1937, and the Disability (DI) Trust Fund established in 1957.  

Payroll tax paid by employees, employers and the self-employed are divided between these two trust funds. Since 2000, employees and employers each pay a combined Social Security and Medicare tax rate of 7.65 percent, with the self-employed paying both portions, of which 6.20 percent helps fund Social Security. Of this 6.20 percent, 5.3 percent goes to the Old Age and Survivors Insurance (OASI) Trust Fund and .90 percent to the Disability (DI) Trust Fund. Historical Social Security tax rates are here. In 2015, the maximum amount of taxable earnings for Social Security is $118,500. There is no maximum for Medicare. 

Both trust funds are managed by the Department of the Treasury. Since they are for different purposes, the two funds are managed separately. You can read about transactions, holdings and interest rates of each fund on the Trust Fund data webpages. 

Just available online, the newest Social Security bulletin, Social Security Bulletin, Vol. 75 No. 1, contains an interesting article about the trust funds. 

This online article, “Social Security Trust Fund Cash Flows and Reserves,” by David Pattison, shares a lot of trust fund information, especially in relationship to the overall federal budget. Mr. Pattison is an economist in a research component of the Social Security Administration. 

I found much of the article interesting. You might too. Consider reading at least the following sections:    

       Introduction

        Are the Trust Fund Reserves Assets? Is Interest on Trust Fund Reserves Income?

       Level-Tax Financing and the Trust Fund Reserve Buildup

       Conclusion

Social Security launches new fraud facts webpage

The Social Security Administration has launched a new web page to highlight the agency’s many efforts in fighting fraud and protecting every worker’s investment in the Social Security program. See it at www.socialsecurity.gov/antifraudfacts. 

Visitors to this site get a behind-the-scenes glimpse into the hard work done every day to fight fraud, waste, and abuse in Social Security and Supplemental Security Income (SSI) programs.  

The website includes information on the tools used to fight fraud, spotlights some of highly successful anti-fraud efforts, and provides materials you can use to help spread the word that Social Security has zero tolerance for fraud. 

One of several links from this new fraud facts webpage is to the Social Security Office of Inspector General (OIG) webpage. The direct OIG link is http://oig.ssa.gov/ and it can also be easily reached through the “contact us” links on the Social Security homepage, www.socialsecurity.gov. From the “contact us” page, click on “Report Fraud, Waste or Abuse.” 

The OIG website has lots of information including some situations, with examples, that may be considered as fraud, waste or abuse against the Social Security administration. You can report possible fraud situations there and read about some recent investigations.

Affordable Care Act enrollment reminder

The Affordable Care Act is administered by the Centers for Medicare & Medicaid Services (CMS), part of the Department of Health & Human Services (DHHS).

If you are enrolling for medical coverage through the Affordable Care Act (ACA), remember that February 15 is the deadline to enroll in a plan for 2015 and the deadline to change plans if already enrolled. 

The Health Insurance Marketplace, available at https://www.healthcare.gov, is an online, one-stop shop that allows individuals, families, and small businesses to compare available health plans and benefits. People ready to enroll can visit HealthCare.gov or call 800-318-2596 (TTY 1-855-889-4325) to get started.

Here is more information from CMS: 

State by state ACA information: http://www.hhs.gov/healthcare/facts/bystate/statebystate.html  

Marketplace application checklist:  http://marketplace.cms.gov/outreach-and-education/marketplace-application-checklist.pdf  

Video – How to choose a plan in the Marketplace:  https://www.youtube.com/watch?v=XOkPAANg3R8  

Social Security employees cannot answer questions about ACA coverage.

Special payments after retirement

Q: I retired in 2014 but expect income in 2015 from work done before I retired. Will this lower my 2015 Social Security benefits?

A: For people younger than full retirement age, the Social Security annual earnings test, also called the retirement test, concerns how much can be earned from wages or self-employment in a calendar year without reducing benefits during that year.

Termed a special payment, money received for work done before retirement is not normally included for the earnings test. Income received after retirement is a special payment if the last thing done to earn it was completed before stopping work. Examples could include accumulated vacation or sick pay, bonuses and sales commissions. If self-employed, net income received after the first year you retire is a special payment if you performed the services to earn the payment before becoming entitled to receive Social Security. 

For example, say a person retired at the end of 2014 and started receiving Social Security retirement as of January 2015. In January, the person receives payment from the former employer for unused vacation time. Since this vacation pay was earned before retirement, it is considered a special payment and not counted towards the 2015 annual earnings limit. 

Two local occupations often receiving special payments for SSA retirement purposes are insurance salespeople and farmers. Insurance commissions for policies sold before retirement but received after the year of retirement are usually special payments. If a farmer fully harvested and stored a crop before or in the month of entitlement to SSA benefits, and then carried it over for sale in the next year, the income will not affect benefits for the year of sale. Keep documentation related to this. 

As always, this is general information.  To learn more, read the SSA publication, Special Payments After Retirement, at www.socialsecurity.gov/pubs/10063.html or contact Social Security.  Annual earnings test information is at www.socialsecurity.gov/retire2/whileworking.htm.

Update – replacement 1099 for 2014

Replacement 1099’s for 2014 are now available online. The way to get one is different from past years. 

When a 1099 replacement was previously requested online, it was mailed to the person’s address as shown on Social Security records. Receipt would take about 10 business days. 

Now, replacement 1099’s are available as a new service for people with a my Social Security account. Through your my Social Security account, the 1099 is available for downloading as a pdf for immediate printing or saving as a file. There is also be an option to have it mailed as in past years. 

Create your personal my Social Security account at www.socialsecurity.gov/myaccount/.