Today’s column addresses questions about when you can submit your claim to start benefits, the Social Security income test, working part-time while receiving disability benefits and what money is paid in social security taxes but not collected. Larry Kotlikoff is professor of economics at Boston University and founder and president of Economic Security Planning, Inc, which markets Maximize my social security and MaxiFi Planner.
See more Ask Larry for answers here.
Do you have social security questions yourself that you would like to answer? Ask Larry about Social Security here.
How far in advance should I apply for social security?
Hi Larry, I’m 70 in January. How far in advance should I apply for social security? My neighbor insists that you must apply four months before your benefits can begin. He says that because I have waited, the earliest I can get benefits now is March. But your answers to other questions seem to indicate that this is not true. My neighbor is however categorical and he has already applied. He said that was how it worked for him, but he made sure to apply four months before his birthday. He says there is nothing I can do about it now. Is he right ? Thanks Janet
Hi Janet, Your neighbor is wrong. He misunderstands Social Security guidelines for filing.
You can apply for benefits up to four months in advance, so you can apply now. You don’t really need to deposit in advance since you would be allowed to claim benefits for up to six months retroactively, but if you want to make sure your first check arrives on time, you should probably plan to deposit the. as soon as possible. From what I understand, the Social Security appointment schedule is overdue, so unless you can file online, you will probably want to contact Social Security very soon.
By the way, if you want to apply for benefits at age 70 and your 70th birthday is in January 2021, you should choose January 2021 as your preferred month to start your benefits. Social Security pays the benefits one month back, so your payment for January will be due in February. Best, Larry
How much can I work and earn if I reach retirement age?
Hello Larry, I have reached retirement age. How much can I earn if I still work full time? Thank you Stéphane
Hi Stephen, If you mean that you have reached Full Retirement Age (FRA) then you can work and earn unlimited amount while receiving all of your Social Security benefits.
However, if you are applying for Social Security benefits and are subject to FRA, at least some of your benefits may need to be withheld if you earn more than the amount exempt from the Social Security income test. My company’s software – Maximize my social security Where MaxiFi Planner – may take into account the earnings criterion for those who have not yet reached full retirement age. Social Security calculators provided by other businesses or nonprofits may provide suitable suggestions if they have been constructed with extreme care. Best, Larry
How much can I earn without compromising my disability benefits?
Hello Larry, I am 57 years old and have been on disability for 10 years. I am considering trying to get a flexible job where I can work a few hours from home, as I am part of a high risk group for Covid 19. The reason I am looking to find work, if I am can is that my husband has been on leave since April with no end in sight. And with my education and work experience as well as the current working conditions, I have found jobs in my field online.
How much can I earn without compromising my handicap? I’m sure it wouldn’t be a problem to reapply, but it’s a pain. Although the last time I received a decision within a month without seeing their doctors. Never seen! Any advice you could give would be appreciated. Thanks Rae
Hello Rae, If you haven’t worked at all since the start of Social Security Disability Benefits (SSDI), you would first have a 9 month probationary period (TWP) during which you could earn an unlimited amount without losing your SSDI benefits.
Once you’ve completed your TWP, however, your earnings should be on average less than the amount Social Security considers substantial gainful activity (SGA), otherwise your benefits could be suspended or terminated. The current monthly SGA earnings amount in 2020 is $ 1,260 for non-blind people and $ 2,110 for people classified as blind by law. Best, Larry
What happens to the money I donate?
Hi Larry, I was a widow at 58 and married to my veteran of the Blue Waters Navy for almost 38 years. But there are no veterans benefits. I started receiving my widow’s benefits when I was 60. I get $ 1,281 per month and $ 147 is withdrawn before I receive my check.
I’m 69 and worked for years, but my Social Security retirement benefit is about $ 100 less than my widow’s benefit, so I will continue to receive my widow’s benefit. What happens to the money I paid and the other part of his benefit amount that I don’t get because I made an early declaration at age 60? My medical and other expenses are too high. Is there a way I can qualify for more? Thanks Kristie
Hi Kristie, I’m sorry for your loss.
I wish I had something useful to tell you, but I’m not. If a person is eligible for more than one type of social security benefit, he or she can only receive the higher of the two benefit rates. If you started receiving your widowhood benefits at age 60, the resulting reduction of 28.5% for age applied to your benefit rate is permanent. So, unless your own benefit rate is higher than your widow’s, you are probably stuck with the amount you receive.
I should mention though that your own benefit rate might continue to accumulate deferred retirement credits (DRC) until you reach age 70, so you should check with Social Security as you approach 70 to see if your own rate may have increased to more than your widow rate at that time.
In terms of what happens to the money you contributed to Social Security while you were working, those taxes go into the Social Security trust fund. All Social Security benefits are paid from the trust fund, and there is no other way to receive money from the trust fund unless you qualify for the benefits. If a person is not entitled to the benefits, the tax money they paid to Social Security simply remains in the trust fund until it is needed to pay the benefits to the people who are there. law. Best, Larry