May 21, 2023 • 29 mins
Suze starts this lesson with an update on what’s happening withe the debt ceiling negotiations and energy stocks. Then, she corrects an answer from last Thursdays podcast and does a deep dive on understanding spousal benefits for Social Security.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Music (00:00):
(Music In).
Suze (00:29):
May 21st 2023. Welcome everybody to the Women and Money
podcast as well as everybody smart enough to listen. Yes,
this is Suze School. This is me without KT. You know,
so many of you wrote in and said, absolutely not.
(00:52):
We love our KT. Let's keep her on Thursday with
you Suze.
And then just let's keep Suze School on Sundays because
they're both so different. So I have a little announcement
to make. That is exactly what we are going to
(01:12):
do except... For the next month or so, I just
want you to listen closely. OK. Our producer that we
all love, Robert.
Robert has decided that he's finally gonna go on vacation
and you know what he's gonna go do? He is
(01:34):
going to go around the United States everywhere where Dead
and Company, the original band was called The Grateful Dead.
And then over the years after Jerry Garcia died, now,
they're known as Dead and Company.
And he wants to see their last concerts. So therefore
(01:59):
he's not gonna be available to produce things and record
them the way that we normally do. Because what I
like to do with Suze School especially, is I like
to record it
as close to when we're gonna drop it. So that
if something happens in the economy or the stock market
or whatever it is, I can talk to all of
(02:21):
you about it, but that's not gonna be able to
happen while Robert is gallivanting around the United States. Let's
put a pause in that for just one second. Robert,
I'm about to tell you something. So, a long time ago,
I was on the plane and the man sitting next
(02:45):
to me
was named Micky Hart. Now I didn't know who Mickey
Hart was on any level
and he looked at me and he said, oh, aren't
you Suze Orman? And I said, yes, he said, I'm
Mickey Hart of the Grateful Dead. And I went, oh,
(03:09):
you're the drummer. And he said I am not a drummer, Suze,
I am a percussionist
and I'm like, ok, whatever. And Robert do you know
that he invited me to a Grateful Dead concert.
(03:31):
And I actually went to the concert and I was
right there backstage, watched the whole thing.
And now I actually got to do the financial planning
for one of them just so, you know, sir, but
back to the point.
So because Robert will be gallivanting around the United States
(03:54):
to see these concerts...
just while he is gone,
I'm going to ask your indulgence that we will be
doing Ask KT and Suze anything for Thursdays and Sundays
because then we can just do a bunch of them
(04:16):
ahead of time
and he'll be able to take a vacation and do
all of that as well. So for those of you
who wrote in and you said, oh, we love KT
we could, why not do another ask Suze and KT
Anything besides Suze School? All right. So you're gonna get
(04:37):
it for a little while. But all of you need
to know if during those times something does happen
and I need to school you on something. I will
figure out a way to do so, but I just
hope that you pay attention and continue to go to
Suze School via the Ask KT and Suze Anything because
(05:01):
really there's always a lot to learn.
All right, two things recently have happened on Friday of
last week now. And that is, uh, the both sides
were having these meetings on the debt ceilings, ok?
(05:23):
And everything looked like it was going pretty good. In fact,
they announced that maybe next week they would have some
solution to this and we could put this all to bed.
Janet Yellen met with all of the bank CEOs saying
it's all looking really good then sometime on Friday afternoon,
(05:48):
everything broke down. The reporters say that they were standing
outside the doors and all of a sudden this congressman,
you know, by the name of Garrett Graves, I think
that was his name. He walked out and he looked
at them and he said, these meetings are no longer productive.
Like he said, something like I'm not quoting him but
(06:11):
something like this...
until people are willing to have, you know, true conversations.
We are not just going to sit there and talk
to ourselves. We are done
And they're over now
Now, I don't know when they'll get back together. I
don't know what that means, but that's not the most
(06:32):
uplifting and positive type of news. On the other hand, however,
Powell on Friday, the Fed chair, Jay Powell also said
that rates may not have to rise as much as
expected to curb inflation.
(06:54):
And he went on and he gave a talk and
essentially what he said is to make sure that the
banks aren't under too much stress because they still are
under stress. Maybe he doesn't have to raise the fed
funds rate as much as he expected to do. So.
So we'll see what happens with the Fed meeting in June.
(07:15):
If he does that.
that's really a good thing because as I said to
you just last Thursday, it's not good. It's not good
to continue to raise the fed funds rate when the
system is under this much stress.
All right. So that's just what I want you to
(07:38):
know in terms of what happened on Friday.
But in regards to all of that, I am saying
to you, stop freaking out, they will figure this out.
Your treasury bills, your certificates of deposit, your money and
money market funds. We will be ok. That doesn't mean
(08:02):
that things won't get wonky for a while.
But I have a feeling that once everybody sees how
wonky things will go because they can't agree on anything,
maybe they will all come to their senses. But you know,
this is a far, far bigger problem
(08:23):
then just this. I think we've kicked the can down
the road when it comes to our debt ceiling maybe
78 times. And there's only so far that you can
kick that can down the road.
It is impossible to have $31 trillion worth of debt.
(08:47):
It is impossible to think that as that debt continues
to grow and grow and possibly receipts go down and
down that we're not going to one day get into
serious financial trouble.
So I think it's really important that both sides of
(09:09):
Congress get their acts together and really figure out what
we can do about this problem
Because we have smoke here in this building and smoke
means eventually we could have a fire and everything then
really does go down. We're not there yet, but that
(09:32):
doesn't mean that we won't get there one day. So
kicking this can down the road
and just continuously raising the debt ceiling without figuring out
how to get things under control and what we really
can and can't do.
I'm telling you one day this will look like good
(09:54):
news to everybody. So I hope they really can get
their act together. But in the meantime, all of you
are to just kind of stay put knowing we will
be ok with what you have. Also, in terms of
(10:15):
many of you are still asking about
P X D, Pioneer, Devon, what should you do? I'm
just gonna repeat once again,
these markets are crazy.
They will go up, they will go down, they may
go up again for the next two weeks or so.
I've said that to you before. They may take a
(10:37):
big dip sometime here before the end of the year
and then go way back up again.
But when you are invested and you are invested for
dividends in good companies,
then you have to stick with the program. Now, if
you have been dollar cost averaging into P X D
(11:01):
or Devon, they have gone down considerably, which means your
yield from where you've purchased, it will be higher. However,
if it is starting to make you nervous, if you
are not knowing what to do, don't do anything, then
stop buying it. Stay where you are and that's it
(11:24):
Because remember that was only to make up a very,
very small part of your portfolio. It wasn't to be
everything that you invested in. It was just to be
a part of everything.
So this should not be freaking you as much as
(11:45):
it is. If it's freaking you, then this isn't right
for you and then you should just sell and take
your losses. I'm serious because what's the goal of money?
The goal of money is for you to be secure
and if you've done something that's making you feel insecure,
then you shouldn't have done it to begin with because
that means you didn't understand it
(12:08):
or you need to stop doing it.
Now, I'm not selling, I'm not nervous about it. I
understand very well. What's happening here? I do as I've
told you before, believe that there will come a time.
I don't know when that is that oil will go
(12:28):
back up to $100 a barrel or so. And then
things will go back up again. But in the meantime,
when I'm not sure what's happening with interest rates, when
I'm not sure what's gonna happen with treasuries or anything else.
At least I know I'm getting dividend money in stocks.
As I said, that, that kind of reminds me we
(12:50):
should do a Suze School. Maybe I'll do that next
Sunday on preferred stocks because that's something that many of
you might want to be looking at as an alternative
for money for you to get income.
But you have to understand when things go up and
things go down,
(13:12):
you can't let that freak you out.
You should be happy about that. So I just wanted
to say that to all of you next. I want
to say something as well. And I want you to
listen to me very closely
last Thursday
for the Ask KT and Suze Anything podcast, KT asked
(13:36):
me a question that she got from the wall about
a divorced woman who wanted to collect social security at 62.
And she wanted to know if she took it at
62 and took a reduction
when she turned 67
(13:57):
could she then switch from her own social security to
her ex spouse's social security and collect 50% of his
social security? And I said yes.
And I have to tell you I could not have
been more wrong if I tried.
(14:19):
So, the correct answer
is, and I want you now to take out your
Suze notebooks because it's very easy to get confused about this.
But this is the correct answer... this. I can promise
you now,
If you want to collect social security at 62
(14:43):
right? What will happen is this:
the Social Security Administration will look at what your benefit
would be at 62 based on your own work record.
And they will figure that out,
then they will compare that
(15:05):
to what your ex spouse's benefit would be based on
their work record. Ok.
And they will look at that and then starting at
the age of 62
you would receive the higher of the two.
(15:26):
Now, what this means is, if you took it at
62
you would still get a 30% reduction. So let me
give you numbers here. And if you write these numbers down,
then you'll never get confused. Like I did the other day,
(15:49):
it happens people. But you know, do you remember that
one podcast that I gave maybe two years ago where
I told you the greatest words in life
and I said the six greatest words in life are
I admit that I was wrong.
(16:09):
So on some level, it felt good to admit it
and that's what it is. But anyway, here we go.
Let's say you are 62.
And at 67
your primary insurance amount, that is referred to as your
P I A, would be $1200 a month. Now
(16:36):
your primary insurance amount is figured at what your social
security would be at your full retirement age.
And remember now, everybody born 1960 or after, their full
(16:57):
retirement age would be 67.
So let's go back to this example.
So here you are, you are 62 years of age.
Your full retirement age is 67.
But if you took your P I A at 62
(17:20):
rather than 67 you would get a 30% reduction.
So if your P I A, your primary insurance amount
is $1200 which is what you would get at the
age of 67 and you take it at 62. There is
(17:44):
a 30% reduction
or $360 a month. 30% of $1200 is $360. Or
your social security would be $840 a month.
(18:06):
Then what would happen is, the Social Security Administration would
then calculate as I said, what your ex spouse's P
I A would be at his full retirement age or
they refer to it as F R A...
and let's just say that would be $3000 a month.
(18:32):
Then what they would do is they would calculate what
you would get if you took the spousal benefit now,
and with that 30% reduction, what that would mean is
you would only get $1050 a month. So rather than
(18:56):
taking $840 a month, if you took your own social security,
you would get $1050 a month
if you took your ex spouse's social security or your
spousal benefit.
(19:16):
So they would automatically give you
$1050 a month forever.
Now,
let's just figure this out. So you understand it. And
how did I get that $1050 a month? Remember
(19:36):
if your ex spouse was getting $3000 a month as
his P I A or would get that as his
full retirement age,
you are entitled for a spousal benefit of 50% of
(19:57):
that ex spouse's P I A. Got that
If your ex spouse's P I A is $3000 a month,
you are entitled at your full retirement age of 67... 50%
of that amount of money or $1500 a month.
(20:22):
So, how did I get that $1050 figure?
Well, if at 67 you are entitled to a full 50%
of his P I A or 50% of $3000 which
is $1500. 30 percent reduction
(20:44):
because you now want to take it at 62
is 30% of $1500 is $450 or $1050 a month.
And that is how much you get. So it does
not work where you get to take your Social Security
(21:08):
at 62 then you switch over to a spousal benefit
at 67. No,
the Social Security administration figures out right then and there
when you want to take a benefit, which benefit would
be higher yours or the spousal benefit. And that is
(21:32):
the one that they give you.
Here's one of the big mistakes that many of you
make when you go and you figure out the future
income that you can count on.
Now, you have to know that you do not get 50%
(21:55):
of what your spouse, whether it's an ex spouse or
your current spouse, of what your spouse gets at 70
you get 50% of what his P I A would
have been at his full retirement age. If you wait
(22:16):
to take it till your full retirement age, did you
get that?
So the big mistake again, that many of you make
is in this example,
if your ex spouse waited to take their social security
(22:37):
till 70 and let's say your ex spouse or your
current spouse is now getting $4000 a month
in your head. You think that if you wait till
your full retirement age? So in this example, if this
(22:58):
woman waited till she was 67
you think that you will get 50% of what your
spouse or ex spouse is currently getting or $2000 a
month in this example? And that is wrong.
You would only get
(23:21):
if you were at your full retirement age when you
applied for it, 50% of what your spouse or ex
spouse would have gotten
as their primary insurance amount at their full retirement age.
So in this case, again,
(23:43):
this person would have gotten $3000
at let's just say 66 or whatever it was, which
was their full retirement age
even though they're getting $4000 now at 70 because they
waited
because they were only entitled to $3000
(24:07):
at their full retirement age. You would only get 50%
of the $3000 at your full retirement age or
whatever reduction you would take from that money if you
took it before your full retirement age. So don't make
(24:31):
the mistake thinking. Oh,
you know, I'm gonna get 50% of what my spouse gets.
If I just wait till my full retirement age, it
does not work that way. You do get however
100% of what your spouse gets if your spouse happens
(24:55):
to die. So if your spouse is getting $4000 a
month right now
and your spouse dies, and let's just say your full
retirement age, whatever it may be or older, you get 100%
(25:15):
of that amount of money. If that amount of money
is more than what you would be getting on your own.
So just remember that what I just said now is
the absolute correct way it works. My apologies for that.
Just a few things for you to understand, to qualify
(25:38):
for spousal benefits. If you are divorced,
you have to be 62 years of age or older.
You have to have been married for at least 10 years.
Your ex has to have qualified for social security, whether
(26:01):
they've taken it or not does not matter
and you have to not be remarried at the time
that you want that you apply.
So that doesn't mean that here you are, maybe you're younger,
you were in your twenties. And maybe you got married
(26:23):
and you were married for 10 years and then your
ex went on and was incredibly successful and maybe you
weren't as successful and then you got remarried to somebody
and you were married for a while.
But if you are divorced or your spouse died before
(26:47):
you then apply for spousal benefits. So let's say they,
you got divorced or your spouse died at the age
of when you were 60 then guess what? You can
qualify for spousal benefits based
on your first spouse's record. Just remember that also. Just remember,
(27:11):
and you should all look into this even if it's
your ex spouse
and you're at least 60 years of age or older,
50 if you're disabled and other things that are out
there or maybe you did get remarried after the age
of 60
(27:32):
then what's interesting is that if your ex spouse happens
to die, you then very well could qualify for survivor
benefits at that point in time. So that's just something
that you all should look into.
(27:54):
Ok. That's a brief Suze School today. But a very,
very important one. As time goes on because this elicited
a whole lot of questions about social security KT will
be adding them to the Ask KT and Suze Anything podcasts.
(28:16):
But until Thursday, when Miss Travis will join us again,
there's only one thing that I want you to remember
to say every single day and it is as follows today,
wherever I go, I will create a more peaceful,
(28:39):
joyful and loving world. And if you do that,
I promise you you will be unstoppable.
Music (28:51):
(Music Out)
(Music In).
Suze (00:29):
May 21st 2023. Welcome everybody to the Women and Money
podcast as well as everybody smart enough to listen. Yes,
this is Suze School. This is me without KT. You know,
so many of you wrote in and said, absolutely not.
(00:52):
We love our KT. Let's keep her on Thursday with
you Suze.
And then just let's keep Suze School on Sundays because
they're both so different. So I have a little announcement
to make. That is exactly what we are going to
(01:12):
do except... For the next month or so, I just
want you to listen closely. OK. Our producer that we
all love, Robert.
Robert has decided that he's finally gonna go on vacation
and you know what he's gonna go do? He is
(01:34):
going to go around the United States everywhere where Dead
and Company, the original band was called The Grateful Dead.
And then over the years after Jerry Garcia died, now,
they're known as Dead and Company.
And he wants to see their last concerts. So therefore
(01:59):
he's not gonna be available to produce things and record
them the way that we normally do. Because what I
like to do with Suze School especially, is I like
to record it
as close to when we're gonna drop it. So that
if something happens in the economy or the stock market
or whatever it is, I can talk to all of
(02:21):
you about it, but that's not gonna be able to
happen while Robert is gallivanting around the United States. Let's
put a pause in that for just one second. Robert,
I'm about to tell you something. So, a long time ago,
I was on the plane and the man sitting next
(02:45):
to me
was named Micky Hart. Now I didn't know who Mickey
Hart was on any level
and he looked at me and he said, oh, aren't
you Suze Orman? And I said, yes, he said, I'm
Mickey Hart of the Grateful Dead. And I went, oh,
(03:09):
you're the drummer. And he said I am not a drummer, Suze,
I am a percussionist
and I'm like, ok, whatever. And Robert do you know
that he invited me to a Grateful Dead concert.
(03:31):
And I actually went to the concert and I was
right there backstage, watched the whole thing.
And now I actually got to do the financial planning
for one of them just so, you know, sir, but
back to the point.
So because Robert will be gallivanting around the United States
(03:54):
to see these concerts...
just while he is gone,
I'm going to ask your indulgence that we will be
doing Ask KT and Suze anything for Thursdays and Sundays
because then we can just do a bunch of them
(04:16):
ahead of time
and he'll be able to take a vacation and do
all of that as well. So for those of you
who wrote in and you said, oh, we love KT
we could, why not do another ask Suze and KT
Anything besides Suze School? All right. So you're gonna get
(04:37):
it for a little while. But all of you need
to know if during those times something does happen
and I need to school you on something. I will
figure out a way to do so, but I just
hope that you pay attention and continue to go to
Suze School via the Ask KT and Suze Anything because
(05:01):
really there's always a lot to learn.
All right, two things recently have happened on Friday of
last week now. And that is, uh, the both sides
were having these meetings on the debt ceilings, ok?
(05:23):
And everything looked like it was going pretty good. In fact,
they announced that maybe next week they would have some
solution to this and we could put this all to bed.
Janet Yellen met with all of the bank CEOs saying
it's all looking really good then sometime on Friday afternoon,
(05:48):
everything broke down. The reporters say that they were standing
outside the doors and all of a sudden this congressman,
you know, by the name of Garrett Graves, I think
that was his name. He walked out and he looked
at them and he said, these meetings are no longer productive.
Like he said, something like I'm not quoting him but
(06:11):
something like this...
until people are willing to have, you know, true conversations.
We are not just going to sit there and talk
to ourselves. We are done
And they're over now
Now, I don't know when they'll get back together. I
don't know what that means, but that's not the most
(06:32):
uplifting and positive type of news. On the other hand, however,
Powell on Friday, the Fed chair, Jay Powell also said
that rates may not have to rise as much as
expected to curb inflation.
(06:54):
And he went on and he gave a talk and
essentially what he said is to make sure that the
banks aren't under too much stress because they still are
under stress. Maybe he doesn't have to raise the fed
funds rate as much as he expected to do. So.
So we'll see what happens with the Fed meeting in June.
(07:15):
If he does that.
that's really a good thing because as I said to
you just last Thursday, it's not good. It's not good
to continue to raise the fed funds rate when the
system is under this much stress.
All right. So that's just what I want you to
(07:38):
know in terms of what happened on Friday.
But in regards to all of that, I am saying
to you, stop freaking out, they will figure this out.
Your treasury bills, your certificates of deposit, your money and
money market funds. We will be ok. That doesn't mean
(08:02):
that things won't get wonky for a while.
But I have a feeling that once everybody sees how
wonky things will go because they can't agree on anything,
maybe they will all come to their senses. But you know,
this is a far, far bigger problem
(08:23):
then just this. I think we've kicked the can down
the road when it comes to our debt ceiling maybe
78 times. And there's only so far that you can
kick that can down the road.
It is impossible to have $31 trillion worth of debt.
(08:47):
It is impossible to think that as that debt continues
to grow and grow and possibly receipts go down and
down that we're not going to one day get into
serious financial trouble.
So I think it's really important that both sides of
(09:09):
Congress get their acts together and really figure out what
we can do about this problem
Because we have smoke here in this building and smoke
means eventually we could have a fire and everything then
really does go down. We're not there yet, but that
(09:32):
doesn't mean that we won't get there one day. So
kicking this can down the road
and just continuously raising the debt ceiling without figuring out
how to get things under control and what we really
can and can't do.
I'm telling you one day this will look like good
(09:54):
news to everybody. So I hope they really can get
their act together. But in the meantime, all of you
are to just kind of stay put knowing we will
be ok with what you have. Also, in terms of
(10:15):
many of you are still asking about
P X D, Pioneer, Devon, what should you do? I'm
just gonna repeat once again,
these markets are crazy.
They will go up, they will go down, they may
go up again for the next two weeks or so.
I've said that to you before. They may take a
(10:37):
big dip sometime here before the end of the year
and then go way back up again.
But when you are invested and you are invested for
dividends in good companies,
then you have to stick with the program. Now, if
you have been dollar cost averaging into P X D
(11:01):
or Devon, they have gone down considerably, which means your
yield from where you've purchased, it will be higher. However,
if it is starting to make you nervous, if you
are not knowing what to do, don't do anything, then
stop buying it. Stay where you are and that's it
(11:24):
Because remember that was only to make up a very,
very small part of your portfolio. It wasn't to be
everything that you invested in. It was just to be
a part of everything.
So this should not be freaking you as much as
(11:45):
it is. If it's freaking you, then this isn't right
for you and then you should just sell and take
your losses. I'm serious because what's the goal of money?
The goal of money is for you to be secure
and if you've done something that's making you feel insecure,
then you shouldn't have done it to begin with because
that means you didn't understand it
(12:08):
or you need to stop doing it.
Now, I'm not selling, I'm not nervous about it. I
understand very well. What's happening here? I do as I've
told you before, believe that there will come a time.
I don't know when that is that oil will go
(12:28):
back up to $100 a barrel or so. And then
things will go back up again. But in the meantime,
when I'm not sure what's happening with interest rates, when
I'm not sure what's gonna happen with treasuries or anything else.
At least I know I'm getting dividend money in stocks.
As I said, that, that kind of reminds me we
(12:50):
should do a Suze School. Maybe I'll do that next
Sunday on preferred stocks because that's something that many of
you might want to be looking at as an alternative
for money for you to get income.
But you have to understand when things go up and
things go down,
(13:12):
you can't let that freak you out.
You should be happy about that. So I just wanted
to say that to all of you next. I want
to say something as well. And I want you to
listen to me very closely
last Thursday
for the Ask KT and Suze Anything podcast, KT asked
(13:36):
me a question that she got from the wall about
a divorced woman who wanted to collect social security at 62.
And she wanted to know if she took it at
62 and took a reduction
when she turned 67
(13:57):
could she then switch from her own social security to
her ex spouse's social security and collect 50% of his
social security? And I said yes.
And I have to tell you I could not have
been more wrong if I tried.
(14:19):
So, the correct answer
is, and I want you now to take out your
Suze notebooks because it's very easy to get confused about this.
But this is the correct answer... this. I can promise
you now,
If you want to collect social security at 62
(14:43):
right? What will happen is this:
the Social Security Administration will look at what your benefit
would be at 62 based on your own work record.
And they will figure that out,
then they will compare that
(15:05):
to what your ex spouse's benefit would be based on
their work record. Ok.
And they will look at that and then starting at
the age of 62
you would receive the higher of the two.
(15:26):
Now, what this means is, if you took it at
62
you would still get a 30% reduction. So let me
give you numbers here. And if you write these numbers down,
then you'll never get confused. Like I did the other day,
(15:49):
it happens people. But you know, do you remember that
one podcast that I gave maybe two years ago where
I told you the greatest words in life
and I said the six greatest words in life are
I admit that I was wrong.
(16:09):
So on some level, it felt good to admit it
and that's what it is. But anyway, here we go.
Let's say you are 62.
And at 67
your primary insurance amount, that is referred to as your
P I A, would be $1200 a month. Now
(16:36):
your primary insurance amount is figured at what your social
security would be at your full retirement age.
And remember now, everybody born 1960 or after, their full
(16:57):
retirement age would be 67.
So let's go back to this example.
So here you are, you are 62 years of age.
Your full retirement age is 67.
But if you took your P I A at 62
(17:20):
rather than 67 you would get a 30% reduction.
So if your P I A, your primary insurance amount
is $1200 which is what you would get at the
age of 67 and you take it at 62. There is
(17:44):
a 30% reduction
or $360 a month. 30% of $1200 is $360. Or
your social security would be $840 a month.
(18:06):
Then what would happen is, the Social Security Administration would
then calculate as I said, what your ex spouse's P
I A would be at his full retirement age or
they refer to it as F R A...
and let's just say that would be $3000 a month.
(18:32):
Then what they would do is they would calculate what
you would get if you took the spousal benefit now,
and with that 30% reduction, what that would mean is
you would only get $1050 a month. So rather than
(18:56):
taking $840 a month, if you took your own social security,
you would get $1050 a month
if you took your ex spouse's social security or your
spousal benefit.
(19:16):
So they would automatically give you
$1050 a month forever.
Now,
let's just figure this out. So you understand it. And
how did I get that $1050 a month? Remember
(19:36):
if your ex spouse was getting $3000 a month as
his P I A or would get that as his
full retirement age,
you are entitled for a spousal benefit of 50% of
(19:57):
that ex spouse's P I A. Got that
If your ex spouse's P I A is $3000 a month,
you are entitled at your full retirement age of 67... 50%
of that amount of money or $1500 a month.
(20:22):
So, how did I get that $1050 figure?
Well, if at 67 you are entitled to a full 50%
of his P I A or 50% of $3000 which
is $1500. 30 percent reduction
(20:44):
because you now want to take it at 62
is 30% of $1500 is $450 or $1050 a month.
And that is how much you get. So it does
not work where you get to take your Social Security
(21:08):
at 62 then you switch over to a spousal benefit
at 67. No,
the Social Security administration figures out right then and there
when you want to take a benefit, which benefit would
be higher yours or the spousal benefit. And that is
(21:32):
the one that they give you.
Here's one of the big mistakes that many of you
make when you go and you figure out the future
income that you can count on.
Now, you have to know that you do not get 50%
(21:55):
of what your spouse, whether it's an ex spouse or
your current spouse, of what your spouse gets at 70
you get 50% of what his P I A would
have been at his full retirement age. If you wait
(22:16):
to take it till your full retirement age, did you
get that?
So the big mistake again, that many of you make
is in this example,
if your ex spouse waited to take their social security
(22:37):
till 70 and let's say your ex spouse or your
current spouse is now getting $4000 a month
in your head. You think that if you wait till
your full retirement age? So in this example, if this
(22:58):
woman waited till she was 67
you think that you will get 50% of what your
spouse or ex spouse is currently getting or $2000 a
month in this example? And that is wrong.
You would only get
(23:21):
if you were at your full retirement age when you
applied for it, 50% of what your spouse or ex
spouse would have gotten
as their primary insurance amount at their full retirement age.
So in this case, again,
(23:43):
this person would have gotten $3000
at let's just say 66 or whatever it was, which
was their full retirement age
even though they're getting $4000 now at 70 because they
waited
because they were only entitled to $3000
(24:07):
at their full retirement age. You would only get 50%
of the $3000 at your full retirement age or
whatever reduction you would take from that money if you
took it before your full retirement age. So don't make
(24:31):
the mistake thinking. Oh,
you know, I'm gonna get 50% of what my spouse gets.
If I just wait till my full retirement age, it
does not work that way. You do get however
100% of what your spouse gets if your spouse happens
(24:55):
to die. So if your spouse is getting $4000 a
month right now
and your spouse dies, and let's just say your full
retirement age, whatever it may be or older, you get 100%
(25:15):
of that amount of money. If that amount of money
is more than what you would be getting on your own.
So just remember that what I just said now is
the absolute correct way it works. My apologies for that.
Just a few things for you to understand, to qualify
(25:38):
for spousal benefits. If you are divorced,
you have to be 62 years of age or older.
You have to have been married for at least 10 years.
Your ex has to have qualified for social security, whether
(26:01):
they've taken it or not does not matter
and you have to not be remarried at the time
that you want that you apply.
So that doesn't mean that here you are, maybe you're younger,
you were in your twenties. And maybe you got married
(26:23):
and you were married for 10 years and then your
ex went on and was incredibly successful and maybe you
weren't as successful and then you got remarried to somebody
and you were married for a while.
But if you are divorced or your spouse died before
(26:47):
you then apply for spousal benefits. So let's say they,
you got divorced or your spouse died at the age
of when you were 60 then guess what? You can
qualify for spousal benefits based
on your first spouse's record. Just remember that also. Just remember,
(27:11):
and you should all look into this even if it's
your ex spouse
and you're at least 60 years of age or older,
50 if you're disabled and other things that are out
there or maybe you did get remarried after the age
of 60
(27:32):
then what's interesting is that if your ex spouse happens
to die, you then very well could qualify for survivor
benefits at that point in time. So that's just something
that you all should look into.
(27:54):
Ok. That's a brief Suze School today. But a very,
very important one. As time goes on because this elicited
a whole lot of questions about social security KT will
be adding them to the Ask KT and Suze Anything podcasts.
(28:16):
But until Thursday, when Miss Travis will join us again,
there's only one thing that I want you to remember
to say every single day and it is as follows today,
wherever I go, I will create a more peaceful,
(28:39):
joyful and loving world. And if you do that,
I promise you you will be unstoppable.
Music (28:51):
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