Mary Beth Franklin

Retirement 2.0blog

Mary Beth Franklin - also known as the 'client whisperer' - on what your clients really want when they talk about retirement.

Apr 14, 2014, 4:21 PM EST

Social Security survivor benefits after botched second marriages

By Mary Beth Franklin

In the country music world, you're supposed to “dance with the one that brung ya.” But the protocol is different in Social Securityland. If you've been married twice and the second union ends in divorce, it may be OK to leapfrog back to spouse No. 1 when it comes time to claim benefits.An interesting letter from an InvestmentNews reader illustrates this point:“If a woman's husband dies and she remarries prior to age 60 and subsequently divorces her second husband, can she collect survivor benefits off of the deceased first spouse?” the reader asked.What do you think?The adviser from St. Louis thought the divorced spouse would be out of luck because she remarried before age 60 and the second marriage, which ended in divorce, did not last the requisite 10 years needed to claim benefits on an ex-spouse's earnings record.“She will have only her own work record to count on for her Social Security benefits,... Read full post

Apr 8, 2014, 3:12 PM EST

Social Security training course covers program nuts and bolts

By Mary Beth Franklin

A few weeks ago, I wrote about a promising new Social Security training program for financial advisers and vowed to report back with my thoughts after taking a one-day online course.I was impressed with the scope of material covered during the National Social Security Advisors' eight-hour training session, and found the more than 120 downloadable slides clear and concise. Premier Social Security Consulting co-founders Jim Blair and Marc Kiner, who run the NSSA training program, did a good job of explaining the eligibility rules for various types of beneficiaries including retirees, current and ex-spouses, families, and survivors. And they gave a thorough review of how benefits can be reduced through annual earnings.But I felt much of the time was devoted to how the Social Security Administration applies the rules rather than how financial advisers can incorporate the rules into their clients' retirement income plan.For example, Mr.... Read full post

Mar 31, 2014, 2:59 PM EST

File and suspend won't be suspended … just yet

By Mary Beth Franklin

While I was on vacation last week, several Investment News readers sent me links to a Reuters news article warning that the Social Security “file and suspend” strategy was under attack from the White House. They asked if I knew about it and what I thought of the proposal that called for the elimination of “aggressive Social Security-claiming strategies.” Yes, I did. In fact, I wrote about it three weeks ago.Buried on Page 150 of the president's $3.9 trillion budget proposal for fiscal year 2015 was this one sentence: “In addition, the budget proposes to eliminate aggressive Social Security claiming strategies, which allow upper-income beneficiaries to manipulate the timing of collection of Social Security benefits in order to maximize delayed retirement credits.”That was it. No explanation. No additional comments.But don't worry just yet. The ability to have clients use the “file-and-... Read full post

Mar 28, 2014, 3:12 PM EST

It doesn't always pay to delay Social Security

By Mary Beth Franklin

Normally, I recommend that most married couples consider the ultimate impact of their Social Security-claiming decision on the survivor benefit they may leave behind for their spouse.As a quick refresher, Social Security survivor benefits are worth 100% of the retirement benefit that the deceased worker collected or was entitled to collect at time of death if the surviving spouse begins collecting the benefit at his or her full retirement age or later.So the larger the retirement benefit, the larger the survivor benefit.Survivor benefits are available as early as age 60, but they would be worth just 71.5% of the deceased worker's benefit, compared with collecting 100% at full retirement age of 66 or later. Survivor benefits are also available to a spouse of any age who is caring for the deceased worker's child who is under 16.I often counsel married couples to delay the retirement benefits of the higher-earning spouse until full... Read full post

Mar 27, 2014, 11:04 AM EST

What female retirees don't know can hurt them

By Mary Beth Franklin

I met a woman named Linda the other day. While we were chatting, she mentioned that she quit her full time job because she didn't need the money, thanks to stashing away nearly half of her paycheck throughout her career. She owns her condo outright and now, in her late 50s, works just one day a week. I congratulated her on her financial independence and told her how I admire single women who take control of their own destiny. As an aside, she mentioned that she had been married once but said they divorced long ago. How long had she been married? I asked. Longer than 10 years? Yes, she replied. Did she know that she is entitled to Social Security benefits as an ex-spouse whose marriage had lasted more than 10 years? I asked. Spousal benefits are worth up to half of an ex-spouse's benefit amount at full retirement age. And she could collect Social Security benefits on his earnings record (if they were larger than her own), even if he... Read full post

Mar 24, 2014, 9:38 AM EST

How to interpret Social Security benefit statements

By Mary Beth Franklin

A financial adviser wrote to me recently asking how to interpret the Social Security estimated-benefits statement of one of his new clients, a veteran firefighter of more than 30 years.The client's public-sector job is not covered by Social Security, but over the years, he has worked some side jobs and paid FICA taxes. He will receive a government pension from his firefighter job.A review of the client's Social Security estimated-benefits statement showed several years where he had no earnings subject to Social Security taxes and a few years where he had a few hundred to a few thousand dollars of covered earnings. The statement said his estimated Social Security benefit at full retirement age is $1,480 a month.The adviser wants to know if he can count on the estimated Social Security benefits when calculating his client's retirement plan.No way.(More: Don't get greedy with Social Security strategies)If you have a client who has worked... Read full post

Mar 20, 2014, 2:30 PM EST

Brain drain at Social Security Administration

By Mary Beth Franklin

When it comes to deciding when to collect Social Security benefits, one of the biggest mistakes a client or financial adviser can make is assuming that the Social Security Administration representatives will help them sort through their claiming options.“The agency is having some real issues about losing staff and not replacing them,” said James Blair, a 35-year veteran of the SSA and co-founder of the National Social Security Association, a private firm that educates financial advisers about Social Security claiming rules.“What you have left are folks who are fairly new” who may not be as familiar with the various nuances of optimizing retirement benefits, Mr. Blair said.SSA has lost 11,000 employees — 12% of its workforce — since 2011, Acting Social Security Commissioner Carolyn Colvin said in a statement following the release of President Barack Obama's fiscal year 2015 budget proposal earlier... Read full post

Mar 14, 2014, 2:04 PM EST

Social Security accreditation program for advisers

By Mary Beth Franklin

A few years ago, Marc Kiner, a retired accountant from Cincinnati, and Jim Blair, a 35-year veteran of the Social Security Administration, teamed up to offer Social Security consulting services to consumers. By 2013, their fledging partnership had blossomed into a national Social Security training program for financial advisers, insurance agents and CPAs.Beginning in 2013, they launched the National Social Security Association and began offering in-person and online classes. I plan to take their all-day online seminar on March 22. I'm not sure one day is enough to qualify anyone as a Social Security expert, but I'll let you know what I think about the training program when I'm done.During a webcast this week, Mr. Kiner and Mr. Blair enumerated the reasons financial professionals need to learn about Social Security and Medicare as a way to distinguish themselves from the competition.“Demographics alone suggest that understanding... Read full post

Mar 7, 2014, 3:15 PM EST

Mary Beth Franklin: Budget raises questions about fate of claiming strategies

By Mary Beth Franklin

Think of it as an asterisk in President Barack Obama's $3.9 trillion budget. One sentence on Page 150 of the president's newly released 2015 budget proposal calls for “eliminating aggressive Social Security-claiming strategies.”My intrepid InvestmentNews colleague Darla Mercado ferreted out the potentially significant statement this week. I called the Social Security Administration immediately to ask about its meaning. My SSA contacts promise to get back to me. I'll let you know when they do. The sentence, in its entirety, says: “In addition, the budget proposes to eliminate aggressive Social Security-claiming strategies, which allow upper-income beneficiaries to manipulate the timing of collection of Social Security benefits in order to maximize delayed retirement credits. “That's it. No explanation. (Mary Beth's advice: Don't get greedy with Social Security strategies)My question is which strategies would be... Read full post

Mar 6, 2014, 12:01 AM EST

Two wives, two sets of Social Security benefits

By Mary Beth Franklin

Thank you to the more than 2,500 listeners who tuned in to my Social Security Bootcamp webcast on Tuesday. If you missed it, or want to review it, an archived version of the webcast is available. Click here to access it.In the meantime, I'll try to plow through the more than 365 questions that I received from InvestmentNews readers before and during the webcast.One reader asked if she would have to share Social Security survivor benefits with her husband's ex-wife if he predeceases them.The reader is the younger, second wife of a retirement-age husband. She is 48 years old and her husband is 66. He and his first wife were married for more than 30 years and have been divorced for 14 years. His ex-wife did not remarry.(Don't miss: Hurried trip down the aisle nixes widow's survivor benefits)In an e-mail, the reader explained that her husband was recently diagnosed with a medical condition that could shorten his life expectancy.“I... Read full post

Earlier Posts »

  @IN Wire

Apr 20 10:34PM
MT @ariweinberg: Fund managers fret as Facebook pushes into financial services http://t.co/6CZ1EVRWV8 via @FT
Apr 20 09:04PM
Bankrupt City Fighting to Open a Crack in California?s Pension Agency, via @nytimes http://t.co/GJOk9Dlng9

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