Joe Anderson, CFP® and Alan Clopine, CPA discuss Social Security strategies for couples claiming spousal benefits in episode 75 of the YMYW podcast, as well as strategies for single people to consider. “Big Al” closes the hour discussing the downsides of annuities. Original publish date October 22, 2016 (hour 1). Note that content may be outdated as rules and regulations have changed.
00:00 – Intro
02:25 – “Many Americans will be living solely off Social Security… people are going to need to play catch-up.”
04:50 – “There are new law changes that happened with Social Security last year when it comes to restricted application and file and suspend.”
06:24 – “There are two different benefits that you claim from Social Security if you’re married: you can claim your own or you can claim the spousal benefit. The spousal benefit represents 50% of your spouse’s benefit.”
10:10 – “Just a couple of years deferring your Social Security and deferring your overall retirement means added savings and added benefits.”
11:10 – “The full retirement age right now is age 66…but you can delay it as late as age 70. Every month you delay Social Security you get an increased benefit.”
11:58 – “If you look at us collectively, it makes sense to wait. But if you look at us individually, it’s a whole different matter. Even though we try to tell people to wait until they’re 70, there are situations when you should take it early. One situation is if you’re disabled.”
13:38 – “If you push it (your Social Security benefit) out three years, it adds 30% more income.”
21:45 – “Which annuity is better for a hands on investor?”
25:25 – “Variable annuities are very expensive…understand that variable annuities have high internal costs…and people are purchasing them for guaranteed income.”
29:19 – “You have to look at the present values of those future cash flows to figure out what your internal rate of return is.”
30:34 – “In most cases I would not recommend a variable annuity, I would recommend an immediate annuity. An immediate annuity means you’re going to give your money to an insurance company and immediately receive income. That’s the cleanest way to receive guaranteed income.”
37:35 – “When it comes to retirement accounts, one of the things that is often overlooked is taxes.”
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IMPORTANT DISCLOSURES:
Pure Financial Advisors is a registered investment advisor. This show does not intend to provide personalized investment advice through this broadcast and does not represent that the securities or services discussed are suitable for any investor. Investors are advised not to rely on any information contained in the broadcast in the process of making a full and informed investment decision.
• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC, a Registered Investment Advisor.
• Pure Financial Advisors LLC does not offer tax or legal advice. Consult with your tax advisor or attorney regarding specific situations.
• Opinions expressed are not intended as investment advice or to predict future performance.
• Past performance does not guarantee future results.
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• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. As rules and regulations change, content may become outdated.
• Intended for educational purposes only and are not intended as individualized advice or a guarantee that you will achieve a desired result. Before implementing any strategies discussed you should consult your tax and financial advisors.
CFP® – The CERTIFIED FINANCIAL PLANNER™ certification is by the Certified Financial Planner Board of Standards, Inc. To attain the right to use the CFP® designation, an individual must satisfactorily fulfill education, experience and ethics requirements as well as pass a comprehensive exam. Thirty hours of continuing education is required every two years to maintain the designation.
AIF® – Accredited Investment Fiduciary designation is administered by the Center for Fiduciary Studies fi360. To receive the AIF Designation, an individual must meet prerequisite criteria, complete a training program, and pass a comprehensive examination. Six hours of continuing education is required annually to maintain the designation.
CPA – Certified Public Accountant is a license set by the American Institute of Certified Public Accountants and administered by the National Association of State Boards of Accountancy. Eligibility to sit for the Uniform CPA Exam is determined by individual State Boards of Accountancy. Typically, the requirement is a U.S. bachelor’s degree which includes a minimum number of qualifying credit hours in accounting and business administration with an additional one-year study. All CPA candidates must pass the Uniform CPA Examination to qualify for a CPA certificate and license (i.e., permit to practice) to practice public accounting. CPAs are required to take continuing education courses to renew their license, and most states require CPAs to complete an ethics course during every renewal period.
