Safe Money - 5-11-24

Episode Transcript

(00:00):
Good Saturday morning to all on thisMother's Day weekend. Don't forget about Mom
tomorrow and a happy Mother's Day fromall of us at URJS and associates.
We want to reach out and tothank all the mothers for their unwaiving support
and dedication. We hope you havea fantastic day tomorrow and every day with

(00:25):
those who can care about you themost. I want to remind everyone that
our virtual community meeting is coming uphere on May twenty first and May twenty
third. These meetings concentrate on Medicare. On Tuesday, May twenty first,

(00:46):
we talk about the basics of Medicareand then focus on the Medicare supplements.
Recall that there are ten Medicare supplementsand we get to choose one of these
ten Medicare supplement plans. That's thetopic of our presentation on Tuesday May twenty

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first. Then two days later,on Thursday, May twenty third, we
again talk about the basics of Medicareand then focus on the alternative to original
Medicare, and and that alternative isMedicare Part C. That's the Advantage plan
and in particular, what we believeis the more competitive of the Medicare advantage

(01:32):
plans, and that alternative is theAAARP Medicare Advantage Plan. So, folks,
if you are aging into Medicare orturning sixty five and initially becoming knowledgeable
for Medicare, or if you arehelping someone who is aging into Medicare,

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I know that they are being inundatedwith solicitation requests from lots of companies and
lots of products. So how doyou make sense of all of it?
Be one of our attendees out ofMedicare information meetings and be able to say,
now I understand the choices I havefor Medicare. So again, if

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you are aging into Medicare or helpingsomeone who is aging into Medicare, I
know you'll be more confident in yourunderstanding of Medicare as a result of participating
in these informational meetings. Remember theyare Tuesday May twenty first and Thursday May

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twenty third. On Tuesday May twentyfirst, we talk about the basics of
Medicare and then focus on the tenMedicare supplement plans and prescription drug plans that
are available. Then two days later, on Thursday May twenty third, we
again focus on the basics of Medicare, and then concentrate on the alternive to

(03:00):
original Medicare. And that alternative isthe Medicare Parts C and that's the advantage
plan. And in particular, whatwe think is the more competitive of the
Medicare advantage plans in this area inthese Medicare regions, and that is the
AARP Medicare Advantage Plan. So onanother closely related topic, the topic of

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social security. This morning, theSocial Security Board of Trustees earlier released its
annual report on the financial status ofthe Health and Social Security Trust Funds.
The combined asset reserves of the OldAge and Survivors Insurance and Disability Insurance trust

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Funds are projected to have enough dedicatedrevenue to pay all scheduled benefits and associated
administrative costs until the year twenty thirtyfive. That's one year later than projected
earlier and with eighty three percent ofthe benefits payable at that time. So

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social Security, I'd like to concentratethis morning on the social security social security
retirement benefit basics. So, accordingto the Social Security Administration, you should
apply for social Security benefits approximately threemonths before your retirement date. To apply

(04:41):
for social security benefits. You canfill out an application online, or you
can visit your local Social Security office. You can also call a Social Security
office at eight hundred seven seven totwo one two one three to discuss your
options or to get more information aboutthe application process. That number is eight

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hundred seven seven to two one twoone three. Social Security benefits are a
major source of retirement income for mostpeople. Your social Security retirement benefit is
based upon the number of years youhave been working and the amount you've earned

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when you begin taking Social Security benefits. That also greatly affects the size of
your benefits. So while you areworking and you're paying Social Security tax that's
called phyica fica phyca taxes, youearn social Security credits, so you earn

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up to four credits each year.You need at least forty credits or ten
years of work to be eligible forretirement benefits. Now, how much will
your retirement benefit be? The SocialSecurity Administration calculates your primary insurance amount upon

(06:08):
which your retirement benefit will be basedusing a formula that takes into account your
thirty five highest earning years. Yourthirty five highest earnings years at your full
retirement age, you will be elean, you will be entitled to receive that
amount. This is known as yourfull retirement benefit. Because your retirement benefit

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is based upon your average earnings overyour working career, if you have some
years of no earnings or low earnings, your benefit amount may be lower than
if you had worked steadily. Forthe Social Security system, your age at
the time you start receiving benefits alsoaffects your benefit amount. Although you can

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retire early at age sixty two,the longer you wait to begin receiving the
benefit up to age seventy up toage seventy, the more you will receive
each month. You can estimate yourSocial Security benefit under current law by using
the benefit calculators on your Social Securitywebsite. Then that website is SSA dot

(07:28):
CoV, so is www SSA dotCoV. You can also sign up for
a My Social Security account so you'llbe able to view your online Social Security
statement. Your statement contains a detailedrecord of your earning of your earnings,

(07:49):
as well as estimates of your retirement, survivor and disability benefits. If you
are not registered for an online accountand are not receiving benefits, you'll receive
a statement in the mail every yearstarting at age sixty, so your full
retirement age depends upon the year inwhich you were born. Now this information,

(08:18):
folks, I have a newsletter form, So if you'd like to have
a copy of that newsletter, justgive me a call, call me a
five sixty three three three two twentytwo hundred, or send me an email.
Go to my website go to dickshilligdot com and scroll over to the
contact icon and drop down for myemail address. So, if you were

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born in between the years nineteen fortythree and nineteen fifty four, then your
full retirement age is age sixty six. Now after that age, if you
were born in nineteen fifty five,your full retirement age is sixty six and

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two months. If you were bornin fifty six, yourfull retirement age is
sixty six and four months, andit goes on through there. So if
you'd like to have a copy ofthis newsletter contains a full retirement age chart,
I'd be happy to send that toyou. Again, give me a

(09:30):
call at five sixty three three threetwo twenty two hundred, or you can
email me by going to my website. Go to go to Dickshilly dot com
and scroll over to the contact iconfor my email address. If you were

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born on January first of any year, then you refer to the previous year
to your full retirement age. Retiringearly will reduce your benefits. You can
begin receiving Social Security retirement benefits beforeyour full retirement age, as early as

(10:16):
age sixty two. However, ifyou if you begin receiving benefits early,
your Social Security benefit will be less. Then if you wait until you're full
retirement age to begin receiving benefits,your retirement benefit will be reduced by five
ninths of one percent for every monthbetween your retirement date and your full retirement

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age up to thirty six months.So once this reduction is determined, then
this deduction is permanent. You won'tbe eligible for a benefit increase once you
reach full retirement age. However,even though your monthly benefit will be less,

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you might receive the same or moretotal lifetime benefits as you would have
had if you waited until full retirementage to start collecting benefits. That's because
even though you'll receive less per month, you might receive benefits over a longer
period of time. Delaying retirement willincrease your benefit. For each month that

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you delay receiving Social Security retirement benefitspast your full retirement age, your benefit
will be permanently increased by a certainpercentage up to the maximum age of seventy.
For anyone born in nineteen forty threeor later than, the monthly percentage

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is two thirds of one percent,so the annual percentage is eight percent.
So, for example, if yourfull retirement age is sixty seven and you
delay receiving benefits for three years,your benefits at age seventy will be twenty
four percent higher than at age sixtyseven. So, like I say,

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listeners, if you'd like to havea copy of this newsletter which contains that
barograph chart and gives you an estimateof your retirement benefit. There's a chart
on this newsletter that illustrates how mucha monthly benefit of two thousand dollars taking

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that full retirement at age sixty sevenwould be worth if taking earlier or later.
So, if you're entitled to fullretirement at age sixty at age sixty
seven of two thousand dollars, ifyou retire earlier at age sixty two,
then your monthly benefit would be fourteenhundred dollars, so it would be fourteen

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hundred dollars early retirement at sixty two, full retirement at age sixty seven would
be two thousand dollars, and laterretirement at age seventy would be almost twenty
five hundred dollars. So, likeI say, if you'd like to have
a copy of this chart and liketo calculate that on your own so you

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have an estimate of what your SocialSecurity benefit would be, then you just
give me a call or drop anemail. I'll be happy to send that
form to you. How does workingaffect your retirement benefit? You can work
and still receive Social Security retirement benefits, but the income that you earn before

(13:48):
you reach age. Before you reachyour full retirement age may temporarily affect your
benefit. So here's how. Ifyou're under full retirement age for the entire
year, one dollar of your benefitwill be withheld for every two dollars you

(14:09):
earn over the annual earnings limit.And in twenty twenty four, the annual
earnings limit is twenty two thousand,three hundred and twenty dollars. A higher
earnings limit applies in the year youreach full retirement age, and the calculation
is different too, so one dollarof your benefit will be withheld for every

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three dollars you earn over fifty ninethousand, five hundred and twenty dollars.
Once you reach full retirement age,you can work and earn as much income
as you want without reducing your SocialSecurity benefit. I think that is very,
very important. Once you reach fullretirement age, you can work and

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earn as much income as you wantand that will not reduce your Social Security
benefit, but you have to reachfull retirement age first. Keep in mind
that if some of your benefits arewithheld prior to your full retirement age,
you'll generally receive a higher monthly benefitat full retirement age, because after retirement

(15:24):
age, the Social Security Administration recalculatesyour benefit every year, he gives you
credit for those with held earnings.Even if your spouse has never worked outside
your home or in a job coveredby Social Security, he or she may
be eligible for spousal benefits based uponyour Social Security earnings record. Other members

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of your family may also be eligible. Retirement benefits are generally paid to family
members who relied on your income forfinancial support, So if you're receiving retirement
benefits. The members of your familywho may be eligible for family benefits include,

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first of all, your spouse wasage sixty two or older, or
your former spouse age sixty two orolder, if you were married for at
least ten years, your spouse orformer spouse at any age, if caring
for your child who is under agesixteen or disabled, your children under age

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eighteen if unmarried, your children underage nineteen, if full time students through
age through grade twelve, or ifan child under the age of nineteen is
disabled, your children older than eighteenif severely disabled. Eligible family member of

(17:00):
its will receive a monthly benefit thatis as much as fifty percent of your
benefit. However, the amount canbe paid each month to a family is
limited. The total benefit that yourfamily can receive, based upon your earnings

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record, is about one hundred andfifty to one hundred and eighty percent of
your full retirement benefit. If thetotal family benefit exceeds this limit, each
member's benefit will be reduced proportionally.Your benefit will not be affected. So
that's the information on Social Security retirementbenefits. Now, there's many many myths

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or facts about Social Security retirement.A myth that is very popular is that
social Security will provide most of yourincome that you need in retirement. And
the fact is, it's likely thatsocial security will provide a smaller portion of
retirement income than you expect. There'sno doubt about it. Social Security is

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an important source of retirement income formost Americans. According to the Social Security
Administration, nearly nine out of tenindividuals age sixty five or older receive social
Security benefits. But it may beunwise to rely too heavily on social Security

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because to keep the system the SocialSecurity System solvent, some changes will have
to be made. The younger andthe wealthier you are, the more likely
these changes will affect you. Butwhether retirement is years away or just around
the corner, keep in mind thatsocial Security was never meant to be the

(19:00):
sole source of income for retirees.President Dwight D. Eisenhower said the Social
Security system is not intended as asubstitute for private savings, pension plans,
and insurance protection. It is ratherintended as the foundation upon which these other

(19:22):
forms of protection can be soundly builtno matter what the future looks. No
matter what the future holds for socialsecurity, focus on saving as much as
possible for retirement. When combined withyour future Social Security benefits, your retirement
savings pension benefits can help ensure thatyou have enough income to see you through

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retirement. Another myth is that ifyou earn money after you retire, you'll
lose Social Security benefits, or thefact is money you earn after you retirement
will only affect your Social Security menefitsif you are under full retirement age.

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Once you reach full retirement age,you can earn as much as you want
without affecting your Social Security retirement benefits, but if you are under full retirement
age, any income that you earnedmay affect the amount of benefit that you
receive. If you're under full retirementage, one dollar in benefits will be

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withheld for every two dollars you earnabove a certain annual limit in twenty twenty.
For that limit is twenty two thousand, three hundred and twenty dollars.
In the year you reach full retirementage, one dollar in benefits will be

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held will be withheld for every threedollars you earn above a certain annual limit
until the month you reach full retirementage. If you reach full retirement age
in twenty twenty four, that limitis fifty nine thousand, five hundred and
twenty dollars. Now I have achart which is in newsletter form. Listeners,

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if i'd like to have a copyof that newsletter. That's very good,
good information about social security. Soremember your full retirement age. If
you were born between the years nineteenforty three in nineteen fifty four, your

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full retirement age is aged sixty six. If you were born in nineteen fifty
five, then your full retirement ageis sixty six and two months. If
you were born in fifty six,then the full retirement age is sixty six
and four months. If you wereborn in fifty seven, your full retirement

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age is sixty six and four months. If you were born in nineteen fifty
seven, your full retirement age issixty six and six months. In nineteen
fifty eight, sixty six and eightmonths in nineteen fifty nine, sixty six

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and ten months. If you wereborn in nineteen sixty and later, your
full retirement is age sixty seven.So another myth about social security is that

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social Security is only a retirement program. Well, the fact is that social
Security offers both retirement benefits, butit also offers disability and survivor benefits.
With all the folk and retirement benefits, it's easy to overlook that Social Security

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also provides protection against long term disability, and when you receive retirement or disability
benefits, your family members may beeligible to receive these benefits too. Another
valuable source of support for your familyis Social Security provides survivor insurance, So

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if you were to die, thencertain members of your family, including your
spouse, children, and dependent parentsmay be eligible for monthly survivor benefits that
can help replace lost income. Sofor specific information about the benefits you and

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your family members may receive, goto the Social Security Administration website that's SSA
dot government so SWWWSA dot gov,or you can call an eight hundred number.
You could call me for a copyof this newsletter which contains the eight

(24:11):
hundred number and a lot of additionalinformation on Social Security. Another myth that
Social Security benefits are not taxable,where the fact is that is you may
have to pay taxes on your SocialSecurity benefits if you have other income.
If the only income you had duringthe year was Social Security income, then

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your benefit generally is not taxable.But if you have earned income during the
year, either from a job orfrom self employment, or had substantial investment
income, then you might have topay federal income tax on a portion of
your Social Security benefit. Up toeighty five percent of your benefit may be

(24:59):
taxable depending upon your tax filing status, whether you file as a single person
or are married filing jointly, Sothe amount of income you have determines that
another myth. Another myth, andI want to emphasize this is that the
myth is social Security is going bankruptvery soon, where the fact is that

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Social Security is facing significant financial challenges, but it is not going bankrupt.
Social Security is largely a pay asyou go system, with today's workers and
employers paying for today's retirees through thecollection of pairole taxes or fighting taxes.
These taxes and other income are depositedin Social Security trust funds and benefits are

(25:48):
paid from them. According to theSocial Security Administration, due to demographic figures,
social Security is already paying out moremoney that takes in. However,
drawing on the Old Agent Survivors InsuranceTrust Fund, the Social Security Administration estimates
that Social Security should be able topay one hundred of the scheduled benefits until

(26:12):
the fund reserves are depleted in twentythirty five, so that time is coming
up. If you'd like to havea copy of that newsletter, I'll be
happy to send you a copy ofthat. Please send me a email.

(26:33):
Go to my website Wwwdikshelley dot com, scroll over to the contact icon,
pick up my email address, andsend me an email about your situation.
Now, I'm an independent insurance agent. I do not represent social Security,
but I do study social security andI know quite a bit about social Security.

(27:00):
Can help you with that. Pleasegive us a call. Call us
at five six three three three twotwenty two hundred, or go to my
website. Go to wwwticshillig dot com, scroll over to the contact icon for
my email address and tell me aboutyour situation. That's about all I have
for you this morning. Don't forgetthose dates coming up here in a week

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or two. May twenty first andMay twenty third for our virtual community meetings.
On May twenty first, we talkabout the basics of Medicare and focus
on the Medicare supplements. Two dayslater, May twenty third, weekend,
talk again about the basics of Medicareand then focus on the alternative to original

(27:45):
Medicare, and that alternative is theadvantage plans. So again call us at
five sixty three three three to twotwenty two hundred. Have a great,
great weekend. Happy Mother's Day toall the moms out there. Good day,