Social Security Continued

Episode Transcript

Speaker 1 (00:00):
And our phone lines they are open for you right now.
If you've got a question for our retirement planning professionals
from Class Financial, all I gotta do is dial in
six oh eight three two one thirteen ten. That's six
oh eight three two one thirteen ten. Love to have
you join us this morning, and we are joined by h. CJ.
Closs and Eric Schwartz, retirement planning professionals from COSS Financial.

(00:21):
You can learn more about them and the whole team
at Costs Financial on the website class financial dot com
that's Coss k l Aasfinancial dot com and their telephone
number six oh eight four four two five six three seven.
No charge for that initial gets to know your appointment
tech Loss Financial. It will be complimentary to you. CJ.
How you doing this morning.

Speaker 2 (00:40):
I'm doing great, Just brave the snow on the way in.

Speaker 3 (00:42):
I'm feeling good about it.

Speaker 1 (00:44):
Yes, it can get dicey out there for sure, for sure. Eric,
how is your drive in this morning?

Speaker 4 (00:51):
You know it was it was pretty slow, Sean, but
I made it.

Speaker 1 (00:54):
That's good. It's good to hear, and it's smart to
keep it slow on days like today, for sure. And
we've got a conversation ahead involving social security, talking about
social security benefits and of course the effect that has
on others around you, and we'll get to that in
just a moment. One of the really cool features of
Money in Motion with Coss Financial is the Class Quiz

(01:16):
Question Week. This week you will have a chance to
win a twenty five dollars gift card two pet smart
from our friends at Coloss Financial. Little tip if you
listen close to the program. Just about every show, the
question and answer to the Class Quiz Question week come
up during the program, so it really benefits you to
pay close attention to the show. We'll do that a
little bit later on the program. We'll talk a little

(01:36):
bit more about how you can win that. And before
we get rolling on this week's conversation around social security,
let's actually take a look back at last week's program
and get the question and answer there as well.

Speaker 4 (01:47):
Eric, absolutely so, as always, thank you everyone for listening,
and congratulations to our winner from last week was Jody
from Fitchburg, and the question was it was a true
or false question. Conversion means you are paying taxes on
the converted amount now, and when we say now, we
mean in the year of the conversion to enjoy tax

(02:08):
free withdrawals later, and the correct answer to that was true.

Speaker 1 (02:13):
Fantastic, congratulations to Jody. You two can be like Jody
all You got to just pay attention to the program
and then we'll tell you how you can win a
little bit later on in the show. So as mentioned
to be talking about social Security benefits, but specifically benefits
and how they impact spouses or former spouses CJ. What
do we need to go there?

Speaker 3 (02:31):
Yeah, that's correct.

Speaker 2 (02:32):
Our focus for today will be on current or former
spouses of US citizens who are historically or are currently
eligible for Social Security benefits. However, before we get too
deep into that kind of narrow discussion, I want to
begin by outlining the various types of Social Security benefits
someone could be eligible to receive throughout their lifetime. We

(02:55):
actually did this about a month or two ago, where
we just reminded everybody, hey, there's actually when when you
say social Security, there's actually here in the United States
a lot more to that in terms of types of
benefits than I think a lot of people realize. The
most common one that we all think of is just
retirement benefits.

Speaker 3 (03:11):
I work, I'm a US citizen with soci Security number.

Speaker 2 (03:14):
I work, I pay Soci Security taxes through myself and
my employer, and then over time, when I get to retirement,
I get an income that is your retirement benefit. However,
there are various types of Social Scurity benefits, and they
include one of the five categories. Category number one retirement benefits,
which I just mentioned, Category number two disability insurance benefits,

(03:36):
Category number three survivor benefits, Category number four Family benefits,
and Category number five Supplemental Security income benefits. Now, according
to the Sociecurity Administration, here are quick definitions of each
type of benefit someone could be eligible to receive. So
of those five, let's just go through quick definitions, beginning

(03:58):
with Socialecurity retirement benefits, the most.

Speaker 3 (04:00):
Common of them all.

Speaker 2 (04:01):
This is a monthly check that replaces part of your
income when you reduce your hours or stop working altogether.
It may not replace all your income, so it's best
to identify other ways to pay for your monthly expenses
as you age.

Speaker 3 (04:17):
Everybody.

Speaker 2 (04:18):
That is a definition from Social Security's website. Benefit item
number two. The soci Security Disability Insurance Benefit, also known
as SSDI, provides monthly payments to people who have a
disability that stops or limits their ability to work. So
social Security disability is for people who have a disability

(04:41):
that stops or limits their ability to work. Number three,
the Social Security Survivor Benefit provides monthly payments to eligible
family members of people who worked and paid Social Security
taxes before they died. So right in the definition there,
survivor benefits is for family members of somebody who has died.

(05:02):
A category Number four, the soci Security Family Benefit provides
monthly payments to certain family members of people who are
eligible for retirement or disability. Often people confuse the family
benefit with the survivor benefit. Survivor is for certain family
members of people who have died. Family benefits are for

(05:25):
certain family members of somebody who is living and is
eligible for retirement or disability. And finally, the last court category,
Social Security Supplemental Security Income Benefit also known as SSI
for short, provides monthly payments to people with disabilities and
older adults who have little or no income or resources.

(05:50):
So against think you know super low income disability, older
adults a little to no income or resources. So as
you can see, over the lifetime of an average American,
there are a multitude of ways that you could be
impacted by various types of Social Security benefits from things
like long term disabilities, or the death of a loved one,

(06:11):
or a divorce or a disabled child, et cetera, et cetera.
We understand that social Security can get a bad reputation,
and there can be good reasons for that number one,
as funding problems or how politicians use it, you know,
during debates, as a political leverage tour tool. However, at
its core, in our opinion, social Security is a modern

(06:34):
financial marvel that positively impacts the lives of tens of
millions of Americans and countless more it keeps countless more
out of extreme poverty. So, with all that being said,
for the remainder of our show today, we will be
primarily focusing on Social Security, family benefits, and survivor benefits.

(06:55):
So again I gave you kind of that fifty thousand
foot view. Now we're going to never throw down in
the five or ten thousand foot view on family benefits
and survivor benefits.

Speaker 1 (07:04):
Love the rundown this morning, as we talk with CJ.
Closs and Eric Schwartz, our retirement planning professionals from Class
financial don't forget. You can learn more online the website
cossfinancial dot com. That's Klaasfinancial dot com. The telephone number
six oh eight four four two five six three seven.
No charge for that initial get to know you appointment
tech COLSS Financial. It will be complimentary to you again

(07:26):
their number six oh eight four four two five six
three seven. So, Eric, what should we know when it
comes to Social Security survivor benefits and how can that
have an impact on a former spouse.

Speaker 4 (07:39):
That's a great question, Sean. And before we kind of
dive into that, I want to just highlight one of
the definitions cj diis referenced. That's the Social Security Administration
gives us for survivor benefits. Okay, So the Social Security
Survivor Benefit provides monthly payments to eligible family members of
people who worked and paid Social Security taxes before they die.

(08:00):
So who are those eligible family members? So Social Security
tells us that this can include spouses, divorced spouses, children,
or even a dependent parent. And while we'll be focusing
today on spouses and divorced ex spouses, it's important for
our listeners to realize there are a lot of other
individuals that could benefit from a Social Security benefit after

(08:26):
a loved one dies, So just keep that in mind.
We're going to dig in deeper here, just on those
benefits for spouses and divorced X spouses, So survivor benefits.
According to Social Security, you may be eligible for survivor
benefits if your current or divorced X spouse died and
you are age sixty year older or fifty to fifty nine,

(08:50):
if you have a disability and you were married for
at least nine months before your spouse's death and you
didn't remarry before age sixty or age fifty if you
have a disability. Now, whenever we talk about Social Security,
the content tends to get very very dense at times,

(09:11):
and there are a lot of different moving pieces, so
stick with us here. Ex Spouses who are married for
at least ten years, as well as some valid non
marital legal relationships may also be eligible. And then, beyond
the two broad categories, you may also be eligible regardless
of age and how long you were married. So one
common example of this is if you're caring for a

(09:33):
child of the person who has passed away. Now, of course,
if you are eligible for a Social Security survivor benefit,
as a current or divorced X spouse, or you were
part of a valid non marital legal relationship. The next
question becomes is what is the benefit, what's the amount,
what are you actually receiving. The answer is it could

(09:53):
provide you with a monthly payment based upon the work
history of the decendent, along with the potential for Medicare
benefits based on their work history. Of course, you have
to be sixty five for that. Based upon what I've
outlined here, if you think you may be eligible for
a survivor benefit, you should gather the decedent Social Security

(10:13):
number and do one of two things. Either call the
Social Security Administration or schedule a meeting at a local
Social Security office. Now, Social Security has actually a pretty
robust website these days. They're trying to get their information
available two folks directly, but in our experience, when it

(10:34):
comes to survivor benefits, there's little information that you can
find that relates directly to you by logging into your
Social Security web portal, So you really do have to
actually directly reach out to the administration and basically you're
going to provide the Social Security representative with the decedent
Social Security number. And then let them know why you

(10:56):
think you may be eligible for survivor benefits. One important
note about survivor benefits. If you begin receiving monthly benefits
and you are not yet full retirement age or FRA,
as we've talked about, you may have earning limits, right,
so they're not going to let you. In some cases,

(11:17):
if you're not yet at your full retirement age, which
is either sixty six or sixty seven or somewhere in between,
your survivor benefit amount could be reduced by the amount
that you earn or are anticipated to earn in a
year over the annual limit which they allow you to
earn twenty three four hundred dollars this year. Now, this

(11:38):
is a really complicated discussion, and we've simplified it here
quite a bit. But for current or divorced expouses of
a deceased individual, you should probably talk with someone at
the Social Security Administration just to determine eligibility, or at
least speak with the financial advisor and get some guidance

(11:59):
on all.

Speaker 1 (12:00):
This great guide. It's some great information. As we talk
with our retirement planning professionals, Eric Schwartz and CJ. Closs,
of course they come to us from Class Financial website
Coss Financial dot com. That's clause k l a A
S Financial dot Com. They're telephone number six oh eight
four four two five six three seven. No charge for
that initial get to know your appointment tech co Loss Financial.
It will be complimentary to you again their number six

(12:22):
oh eight four four two five six three seven. We're
going to talk about Social Security family benefits. We'll get
the details with CJ. We'll also head on over to
the Money in Motion listener question corner and have the
Class Quiz question a week. All of that coming up
in Money and Motion with Class Financial right here on
thirteen ten WIB eight talking with our retirement planning professionals CJ.

(12:44):
Closs and Eric Schwartz. They come to us from Class
Financial the website coss Financial dot com. That's css k
l a A S Financial dot com. Telphy number for
the office right here in Madison, sixt oh eight four
four two five six three seven. Talking Social Secure this week,
and we started that last segment. We ended up talking
about survivor benefits and very very complicated and some really

(13:09):
good guidance there. If you missed any part of that
segment to want to listen back to this show or
previous shows Doorfgate. You can always listen and subscribe to
the podcast at class financial dot com. So, CJ, what
about social Security family benefits and what do we need
to know here? So and you know, kind of how
does that differ then from survivor benefits?

Speaker 3 (13:29):
Yeah?

Speaker 2 (13:29):
Good questions. So, you know, as as Eric kind of
ended his section there, the big encouragement here is like, whoa,
there's a there's a lot to this. You know, if
I'm a survivor or an ex house of somebody who
has passed away, I may be eligible for benefits. So
our biggest encouragement is just kind of keep your ears
open to what we're saying. And if you think this

(13:50):
might impact you, just talk to the Social Security Administration. Now,
even as I say that, I'm chuckling on the inside
a little bit. Just talk to the Socialcurity Administration.

Speaker 3 (13:58):
Yeah, it's like your.

Speaker 2 (13:59):
Neighbor, go over and chat with them and have a
nice Unfortunately, that's not the way it works with Social
Security Administration.

Speaker 3 (14:03):
They get a lot of inbound calls.

Speaker 2 (14:05):
There's almost seventy million recipients of Social Security, not to
mention three hundred million people paying into.

Speaker 3 (14:10):
This thing or something like that.

Speaker 2 (14:12):
So yes, it could take some time to get a
meeting set up, but just talk to them and see
if you're eligible. Now to your point, you know, we
kind of move on from survivor benefits and we talk
about family benefits, you know, and how do these things differ. So,
just like Eric did, I'm going to start with the definition. So,
the Social Security Family Benefit provides monthly payments to certain

(14:34):
family members of people who are eligible for retirement or
disability benefits. So again right away you can tell this
definition differs from the survivor of benefits Eric's just discussed
in that we are not referencing deceased, current or divorced
ex spouses in this definition. We are referencing benefits of

(14:55):
a living, current or divorced X spouse. It may be
eligible for family benefits if you are the spouse, divorce
ex spouse, or child of someone entitled to retirement or
disabilility benefits. We will be focusing on spouses and divorced
X spouses. Okay, so we're not focusing on all the
definitions of people who might be eligible for family benefits.

(15:17):
We're just focusing today on the spouses and divorced X spouses.

Speaker 3 (15:21):
So let's dig a little deeper.

Speaker 2 (15:24):
You may be eligible for family benefits if you have
been married for at least one year and are age
sixty two and older, or caring for a child age
fifteen and younger, or caring for a child of any
age who has a disability. I'm going to repeat that
you may be eligible for family benefits if you have

(15:44):
been married for at least one year and are age
sixty two and older, or caring for a child age
fifteen and younger, or caring for a child of any
age who has a disability. X X spouses who were
made married for at least ten years, as well as
some valid non marital legal relationships, may also be eligible.

(16:07):
So notice one important distinction between survivor benefits and family benefits.
In the case of survivor benefits, where you were the
spouse at the point of their death, you had to
be married for at least nine months before they died
and didn't rema and didn't remarry before age sixty to
be eligible for those benefits. However, in the case of
family benefits, where you are the current spouse, you must

(16:29):
have been married for at least one year.

Speaker 3 (16:31):
To be eligible for these benefits.

Speaker 2 (16:33):
I tell everybody this because there's quite a bit of
like interesting things floating around there. People go, wait, I
thought it was nine months. Other people go, no, wait,
I thought it was one year. And then other people, yeah,
go wait, I thought you had to be married for
ten years. And actually all of those are true, just
depending upon what type of benefit you're talking about. So

(16:54):
I know we're probably freaking you all out because there's
so much complexity here, But our hope is that you
here's something that says, hey, that could be me, and
then you start looking into it. So, similar to what
Eric referenced earlier, if you are eligible for a family
benefit as a current or divorced ex spouse or we're
part of a valid non merital legal relationship, you could

(17:16):
be eligible for a monthly payment based upon the work
history of the living current.

Speaker 3 (17:21):
Spouse or divorced x spouse.

Speaker 2 (17:23):
So if you think you may be eligible for a
family benefit, just like Eric mentioned before, you should do
one of a few things. Either call the Social Security
Administration to confirm your eligibility and ask questions, or schedule
a meeting at a local Social Security office or talk
with a financial advisor who can discuss the logistics of
your circumstances, and in any of these instances, you should

(17:45):
be prepared with some of the following basic information, your
Social Security number, your work history, your current in any
past marriages, and then name and details about your children.

Speaker 1 (17:57):
A lot of great detail there. So we talked with CJ.
Class and Eric Schwartz. They are our retirement planning professionals
from Coss Financial. A lot of really important, great content
each and every week here on Money in Motion, including
this week with Coss Financial. Don't forget if you ever
missed part of the program, you can always listen back
at cossfinancial dot com. You can also sign up for
the weekly Market Pulse newsletter. It's a great weekly email.

(18:19):
It's got a snapshot of what's happening in the markets.
Also linked to the most recent podcasts that available to
you at Cossfinancial dot com. That's Klaas Financial dot com.
They're telfoed up for the office right here in Madison
six oh eight four four two five six three seven.
No charge for that initial gets know your appointment at
Loss Financial. It will be complimentary to you again their
number six oh eight four four two five, six three seven.

(18:41):
We're going to talk have a bit of a Rod
Tidwell Jerry Maguire moment in just a moment here on
thirteen ten wi BA. We'll do that next as Money
in Motion with COSS Financial continues right here thirteen ten
wib I talking with CJ. Kloss and Eric Schwartz. They
are our retirement planning professionals from Class Financial, the website
class financial dot com. That's Coss k l a as

(19:03):
Financial dot com telph number six so eight four four
two five six three seven. An Oscar winning moment. I
and a lot of folks probably from Jerry Maguire. You
got Cuba Gooden Junior, as Rod didwell going back and
forth on the phone. Show me the money, Show me
the money. Let's talk about showing me the money. Kind
of a little serious though, Eric, how much could I

(19:24):
get then when it comes to monthly benefit if I'm
eligible for a survivor benefit or family benefit there.

Speaker 4 (19:32):
Well, luckily, Sean, we don't get a whole lot of
Jerry Maguire moments in our meeting, but they are generally
asking us that same question, how much am I going
to get? The Social Security Administration uses a specific formula
calculate the amount of a survivor benefit or a family benefit,
and in general it's a percentage of the current or

(19:54):
former spouse's primary insurance amount. So we've talked about this
on the show before. Your primary insurance amount is the
benefit amount you would receive at your full retirement age.
They'll get an age between sixty six and sixty seven.
But the calculation is more complex, of course, and it's
impacted by several different factors, some of which include your age,

(20:17):
your current spouse's eligibility for benefits, your work history, the
year that your late spouse passed away, whether or not
you remarried, and at what age you do decide to remarry,
the number of eligible family members that you have, the
year you actually become eligible, and finally, the age that
you begin drawing your benefit. Okay, so I want to

(20:41):
just kind of pause here for a second. Unfortunately, CJ
and I have a lot of experience helping clients through
the process following the loss of a loved one, and
beyond all of the normal things you'd expect, you know,
grief and loss, we're trying to help them figure out
how to navigate the financial implications of this, and I

(21:04):
will say from my experience, especially in the case of
young families, but also you know, in most cases, the
Social Security survivor benefit tends to be one of the
I would say most surprising to clients and in many
ways impactful. I mean, we're potentially talking about thousands of
dollars a month here for a family that may have

(21:25):
just lost, you know, one of their income earners. So
we really really want to encourage people don't ignore this,
really really take the steps to investigate any benefits you
might be eligible for. Get in touch with the Social
Security Administration and figure out if there are benefits that
you are eligible for, not only from a deceased spouse,

(21:47):
but just a living former spouse as well.

Speaker 1 (21:50):
Talking this morning with Eric Schwartz and CJ. Closs. They
are our retirement planning professionals from Class Financial online class
financial dot com. That's Class k l aasancial dot com.
While you're at the website, of course, you can learn
more about COSS Financial. You can learn more also if
you are a business owner and the different options and
different divisions at COSS Financial as well stuff for you

(22:10):
as an individual, all available at cossfinancial dot com. Also
While you're there, you can submit a question to be
answered right here on the program and our Money in
Motion listener question corner, and this week, Sue writes in
she says, I was married for twenty eight years. I
lost the love of my life and the father of
my three children to cancer at age fifty two. I'm
now fifty eight years old, with all my children out

(22:32):
of the house, and have been fortunate enough to meet
another great man who I would like to marry. However,
before we get married, I want to know if there's
anything I should consider relative to potential social security benefits.
That question from Sue CJ.

Speaker 3 (22:48):
Yeah.

Speaker 2 (22:48):
Well, first things first, thanks Sue for writing in this question,
because this one would be hard for me to answer
on the fly. I was thankful to have a little
bit of time to kind of look in into this one. However,
let me begin by saying, I'm really sorry. It sounds
like it's been a while since your late husband's passing,
but I can't imagine the heartache of losing a spouse

(23:09):
to cancer after bearing and raising children together.

Speaker 3 (23:13):
So, yeah, what a mess.

Speaker 2 (23:15):
I'm sorry, but your question is timely since we just
discussed soci security survivor benefits during our show today, so
some listeners may already know the answer to your questions
too based upon what we just discussed. So the answer
is yes, you may want to slow down and speak
with someone at the Social Security Administration and or your
financial advisor before getting remarried, depending upon the specifics of

(23:41):
your circumstances. If you remarry prior to reaching your age sixty,
you could lose access to Social Security survivor benefits also
known as widow's benefits by the way off your deceased
spouse's record. Now, truthfully, this may or may not be
very impactful to you, depending upon your current and future
projected circle ccumstances With the man that you mentioned, You

(24:02):
might want to marry, but it is worth slowing down
to ask some questions before you tie the knot, especially
given that I think you said you were fifty eight
years old and really marriages after sixty don't impact these
previous benefits. So yes, I guess what I'm trying to
say to you, Sue, is great question. We would actually
suggest pause, slow down before you get remarried. Here, talk

(24:24):
to Social Security Administration and just understand the implications. It
wouldn't surprise us if at the end of this little
research project that you come to find out that it's
not a huge impact and you're going to get remarried anyways,
but you would hate to There's no redos here, right,
You would hate to get married and then recognize that
you lost a significant benefit that could have helped you

(24:45):
and really the man you intend to marry.

Speaker 1 (24:47):
Great question, Sue, and don't free. You can submit your
question if you could be like Sue, if you got one,
you always submitted at class financial dot com. You can
call in during the program, or even better, if you
call Class Financial's office here in Madison six four four
two five six three seven. That first appointment at COSS Financial,
it will be complimentary to you. You can get that
start that conversation again. All I get is pick up phone.

(25:09):
Give them a call six oh eight four four two
five six three seven. Speaking of that telephone number in
the Madison office. Time now for the Coss Quiz Question
the week. Your chance to win a fantastic prize this week,
a twenty five dollars gift card to pet Smart Class
Quiz Question Week. It works like this. In just a moment,
I'll ask you the class Quiz question the leak. You'll
then him thirty minutes to the end of the program
to call the Class Financial Office here in Madison at

(25:30):
six oh eight four four two five, six three seven
if you are the first car with correct answer to
win this week's prize again, the twenty five dollars gift
card to pet Smart. This week's class quiz question the
week is this true or false? You may be eligible
for a Social Security survivor benefit as a spouse if
you were married for at least nine month months before

(25:53):
their death. True or false? Telephone number six oh eight
four four two five six three seven. First call correct
answer one. That's twenty five dollars gift card to pet Smart.
And don't forget that's Class Financials Office right here in Madison,
that number six oh eight four four two five, six
three seven. CJ.

Speaker 3 (26:10):
Eric.

Speaker 1 (26:11):
It's always great chatting with both of you, you guys,
enjoy this great Dan and we'll do it all again
real soon. Thanks Sean, Thanks Sean, see you guys, and
doctor Marty Greer she comes your way next here on
thirteen ten w IB eight