A lot of people look forward to retiring when they become eligible to receive Social Security and perhaps to a lesser extent Medicare benefits. If they are wise they are not relying too heavily on Social Security, but it makes sense to circle that date on the calendar as the time when they will put their working years behind them.

At the present time, everyone who has paid into it sufficiently becomes eligible to enroll in the Medicare program when they become 65 years of age. There is no one age at which everyone becomes eligible for Social Security. Your eligibility date varies depending on the year during which you were born.

For people born between 1943 and 1954 the age at which you become eligible to receive your full Social Security benefit is 66. It then goes up by two months per year until 1960. So someone born in 1955 reaches full retirement age when they are 66 years and two months old. If you were born in 1956 you reach full retirement age four months after your 66th birthday. It goes on in this manner until 1960; individuals who were born in 1960 and after reach full retirement age in the eyes of the Social Security Administration on their 67th birthdays.

The above facts are current as of this writing. However, they are not set in stone. As we are all aware we are in the throes of a crisis of sorts with regard to the national debt. Outlays for Social Security and Medicare comprise over one third of all federal spending. Cost-cutting is the order of the day, and entitlement programs for seniors have been targeted by many.

One very simple and efficient way that spending on these programs could be reduced would be to raise the age at which Americans can apply for Social Security and Medicare. This is something to pay attention to as you plan for the future and set a retirement date.

Ryan, Hicks, Cumpton & Cumpton LLP is a member of the American Academy of Estate Planning Attorneys.

One of the most stunning demographic realities of our era is the rapid aging of the population. Senior citizens are the age group that is expanding more rapidly than any other, and it is really amazing to consider the impact that this is having on the Social Security system. No fewer than 10,000 new applicants are seeking their benefits every day, and this volume is expected to remain constant for the next 20 years. This is truly profound, and with so many people reaching retirement age there are a lot of questions being asked.

One of the questions that many seniors have involves maximizing their benefit. How do you get the most out of Social Security? The short answer can be reduced to these two words: work longer.

Full retirement age as it applies to Social Security is 66 years of age for those Americans born between 1943 and 1954. It then rises by two months per year until 1960; the full retirement age for those born during this year and later is currently 67. But, you do not have to apply for your Social Security benefit when you reach full retirement age. If you want to you can retire when you are as young as 62 and receive a reduced benefit.

But on the other end of the spectrum, you can delay your application until you are 70 years old and earn delayed retirement credits that increase your benefit by 8% for every year that you work past your full retirement age.

In addition to an increased benefit via the delayed retirement credits, your benefit can also be maximized for another reason if you work past your full retirement age. Your benefit is calculated using your top 35 earning years. So if you made more money during your last years than you did during any years that previously comprised your 35 highest earning years your benefit would rise as a result.

Ryan, Hicks, Cumpton & Cumpton LLP is a member of the American Academy of Estate Planning Attorneys.

Social Security widow benefits are paid when a married worker dies. There are also social security divorced spouse benefits, if the marriage lasted at least 10 years. Social Security divorced spouse benefits are available as early as age 60. Other persons eligible for benefits of a deceased worker are:

• Your unmarried children who are younger than age 18 (or up to age 19 if they are attending elementary or secondary school full time) Your children can get benefits at any age if they were disabled before age 22 and remain disabled.
• Under certain circumstances, benefits also can be paid to your stepchildren, grandchildren, step grandchildren, or adopted children.
• Your dependent parents can receive benefits if they are age 62 or older. (For your parents to qualify as dependents, you would have had to provide at least one-half of their support.)

The social security spousal allowance ends when minor children reach the age of 16. The Social security spousal reduction occurs if widow/er seeks social security widow benefits before the age of 62.

Should you get widow/er benefits if you are the spouse that would have the higher retirement benefit if you spouse had not predeceased you? If you are between the age of 60 and 65, retired and drawing pension benefits but not Social Security retirement benefits, receiving benefits on your spouse’s record will allow you to get more out Social security. You can receive widow’s benefits on your spouse’s record until you reach your retirement age. When you reach retirement age, your benefits will change to retirement on your own record, if you are entitled to a higher payment amount based on your own record. This allows you to enjoy retirement at an early age but hold off on drawing retirement benefits until your retirement age which entitles you to more money.

Ryan, Hicks, Cumpton & Cumpton LLP is a member of the American Academy of Estate Planning Attorneys.

The baby boomer generation is beginning to retire. If you have been on the Social Security Administration website, recently it is shocking to see Chubby Checkers and Patti Duke advertising retirement and realizing that yes you are getting that old. It is intelligent and reasonable to plan for the possibility that you may become incapacitated and unable to handle your own affairs or tell anyone what you want. There are three things you need to do to protect yourself in the event you become incapacitated.

1) Review the Social Security Statement you receive annually. Within three months of your birthday, Social Security sends you a statement. The statement includes an estimate of monthly retirement benefit, if you take it at age 62 or wait until your full retirement age, a estimate of you monthly disability payment if you should become disabled and a statement of the amounts you have paid into the system through your earns. Check this portion carefully and take steps to correct errors. The higher the amount paid into the system, the higher your monthly benefit will be.

2) Durable Power of Attorney – indicates whom you give the authority to handle your finances and other business matters should you become incapacitated. Designating a power of attorney can save your family the burden and expense of petitioning the court for guardianship.

3) Healthcare Directive – executing a healthcare directive or living will give your doctor and family the information they need regarding your wishes for medical treatment in certain circumstances. You can also appoint a person to make those decisions for you.

Items two and three require the services of an attorney but they are a necessary component of preparing for incapacity. If you already have counsel that is helping you develop an estate plan a healthcare directive and durable power of attorney should be part of the package.

Ryan, Hicks, Cumpton & Cumpton LLP is a member of the American Academy of Estate Planning Attorneys.

It seems that there is at least one news story about Social Security everyday and all the information is confusing. If you are in part of the baby boomer generation that is just starting to retire or think about retirement there are things you can do to maximize your benefits.

• Review your Social Security Statement – every year within three of your birthday, Social Security sends you a social security statement. This statement gives you vital information about social security benefits to which you may be entitled. It will tell you if you have enough work quarters to qualify for retirement benefits, estimate what your monthly benefit will be if you retire at age 62, 65 or later. It will also show you how much you have paid into receive benefits. Check this information carefully against your own records. Report any errors immediately to make sure you get the maximum benefit to which you are allowed.
• What Age should you Retire- You do not have to retire just because you have reached retirement age. If you retire at age, 62 you will receive a smaller monthly benefit check than you would receive retire later. The longer you wait to retire the higher your social security benefit checks will be. Remember Social Security retirement benefits are not meant to replace your entire income.
• Applying for Medicare – you should apply for Medicare when you are eligible even if you are not ready to retire. Some employers require that you apply for Medicare because it allows them to become the secondary insurer for medical benefits as opposed to providing primary coverage. You should check with your human relations department to determine what is required by your employer.
• Consider drawing survivor’s benefits at age 60 if your deceased spouse’s lifetime earnings are less than yours. You could receive the reduced benefits until you reach retirement age, and then receive higher benefits at age 65.

You can get more information about all of these issues by going to the Social Security Administration website. www.ssa.gov. or by calling 1-800-772-1213.

Ryan, Hicks, Cumpton & Cumpton LLP is a member of the American Academy of Estate Planning Attorneys.