Economic Security Planning, Inc.

Today's column addresses questions about spousal benefits before delayed retirement credits at 70, potential effects on Social Security benefits of the WEP and the GPO due to receiving a public pension and what happens to other benefits drawn on a person's record when child benefits end. Larry Kotlikoff is a Professor of Economics at Boston University and the founder and president of Economic Security Planning, Inc, which markets Maximize My Social Security and MaxiFi Planner.

See more Ask Larry answers here.

Have Social Security questions of your own youd like answered? Ask Larry about Social Security here.

Will Changes In The Full Retirement Age Reduce My Social Security Benefit At 70?

Hi Larry I turn 68 January 2021 and I was planning on waiting until 70 to start drawing my Social Security retirement benefits. I currently receive my spousal benefit, which is relatively small. My wife retired at 62. Will my age 70 Social Security benefit be reduced due to all these changes of full retirement age I've heard about? Thanks, Jonathan

Hi Jonathan, Your own Social Security retirement benefit amount won't be reduced as a result of the fact that you've been drawing spousal benefits. Nothing has changed with regard to Social Security regulations that would affect your ability to wait and claim your full rate at 70 when you reach that age. Your full retirement age (FRA) is 66, so if you wait until the month you turn 70 to start drawing your retirement benefits, you'll receive four full years of delayed retirement credits (DRCs). That will make your benefit rate 32% higher than if you'd started drawing your retirement benefits at FRA. Best, Larry

Is It True That My Social Security Amount Will Be Reduced If I Receive PERS Retirement?

Hi Larry, I am a retired NV teacher in the marvelous PERS retirement system. I worked enough summer jobs and NV National Guard to qualify for about $900 when I turn 66 years and two months old. The rumor mill out here claims that Ill only get about $300 monthly from Social Security because Im receiving PERS money. Please, tell me the rumor mill is wrong. Thanks, Chuck

Hi Chuck, Your monthly Social Security retirement benefit rate won't be reduced by as much as $600 because of your PERS pension, but it sounds like it will almost certainly be reduced significantly due to the Windfall Elimination Provision (WEP). The WEP can cause a person's Social Security retirement benefit rate to be calculated using a less generous calculation formula if they receive a pension based on their work and earnings that were exempt from Social Security taxes.

I don't have enough information to be able to give you an idea of how much your Social Security rate may be reduced, but you may want to consider using my company's software Maximize My Social Security or MaxiFi Planner to analyze your options so that you can determine the best strategy for maximizing your benefits. Our software is fully capable of handling WEP computations as well as the Government Pension Offset (GPO) that could also come into play if you receive auxiliary or survivor benefits based on another person's Social Security record. Social Security calculators provided by other companies or non-profits may provide proper suggestions if they were built with extreme care. Best, Larry

What Happens When My Son's Benefits End?

Hi Larry, My last son is turning 18 in January and his Social Security benefits will end. What happens to the money and does it come back to me or does it just end? Thanks, Rita

Hi Rita, Your son's benefits will simply stop being paid when he's no longer eligible. Child benefits paid from the record of a living parent are auxiliary benefits. In other words, they are an extra benefit paid in addition to the parent's own retirement benefit rate. Auxiliary benefits are only paid if an eligible family member qualifies for such benefits.

The payment of auxiliary benefits does not reduce the benefit amount payable to the worker whose record the benefits are paid from. Therefore, since your son's benefits had no effect on your benefit rate in the first place, your benefit rate won't change as a result of your son's payments stopping. Best, Larry

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Ask Larry: Will Changes In The Full Retirement Age Reduce My Social Security Benefit At 70? - Forbes