Building Legacies that Last Estate Planning and Elder Law

Social Security Can Be Fixed

MP900390083 (1) People who are opposed to the Social Security system claim that it is about to go broke and disappear soon. That is not true.

Social Security opponents and opponents of government spending in general, like to make the claim that Social Security is going to go broke or bankrupt. They then normally use this piece of information to get people to support cuts to Social Security benefits or increases to the age of retirement.

They are using  recent government reporst as ammunition to suggest that if something is not done, then Social Security will go broke in 2022. The problem is the claim is not true, as Forbes discusses in "Fake News: Why Social Security Isn't Going Broke."

Social Security currently takes in more money every year than it pays out in benefits. That has created a surplus in the Social Security Trust Fund. What will happen in 2022 is that, due to demographic changes, Social Security will start paying out more than it takes in. However, since there is a surplus, current benefits will not have to change. The surplus can be spent down. It will not run out until 2034. When that happens, Social Security will not disappear. Instead benefits will be cut slightly, as the program will only be able to pay out as much money as it takes in.

This means is that politicians have a lot of time to fix Social Security, if they are willing to do so. They do not need to raise the retirement age or cut benefits. They can also fix things by increasing funding for the program.

Reference: Forbes (June 18, 2018) "Fake News: Why Social Security Isn't Going Broke."


Entitlement Reform Might Be Next

It is looking increasingly likely that next year Congress will take up reform to entitlement programs. Bigstock-Elder-Couple-With-Bills-3557267[1]

The U.S. has some political junkies who follow everything that goes on in Washington D.C. all the time. However, for the vast majority of Americans, politics is preferably just done every four years.

Presidential elections are held, a winner is declared, and most Americans go on with their lives not thinking too much about politics.

Things are different now. None of us can escape political talk. It is everywhere.

Many people would probably appreciate a break next year, until October before the mid-term election campaigns heat up.

But it appears that Republicans may propose cuts to some of the most popular government programs, according to Financial Advisor in "GOP Laying Groundwork To Cut Future Social Security, Medicare, Welfare Outlays."

Republicans are talking about making cuts to programs for the elderly, such as Social Security and Medicare. It is likely that any proposed cuts would be delayed and not effect current retirees.  However, they will still be controversial for Americans who plan to rely on the programs in the future.

Cutting Social Security and Medicare is considered to be like touching the third rail in American politics. These are not popular proposals. Going through with this plan, guarantees that we will not be getting a relief from politics in 2018.

Reference: Financial Advisor (Dec. 6, 2017) "GOP Laying Groundwork To Cut Future Social Security, Medicare, Welfare Outlays."


Major Social Security Raise Possible

MP900446481[1]Early signs indicate that Social Security benefits could see a dramatic increase next year. That will be welcome news for seniors whose benefits have lagged far behind their buying power.

Every year the Social Security benefits that millions of senior citizens receive on a monthly basis are supposed to increase with the cost of living. However, it has long been pointed out that it does not really happen.

The methods used by the federal government to determine cost of living adjustments are not an accurate reflection of the purchasing power of recipients. For example, since 2000 benefits have risen 43%, but senior buying power has risen 86% according to advocates.

The average increase in benefits in the last few years has only been 1%, since overall official inflation rates have been low.

That could change next year, according to Barron's in "Big Social Security Bump Could Be Coming."

Early signs indicate that a benefit increase of 2.1% is coming next year.

That is good news for seniors who have seen their benefit dollars pay for fewer and fewer of their expenses.

The bad news is what that might mean for the health of the Social Security system itself. It needs to be adjusted to make sure the Social Security Trust Fund does not run out of money in the next couple of decades, which would result in automatic steep benefit cuts.

Benefit increases are only expected for now.

No official announcement will be made until October.  Therefore, seniors should not plan for raises yet.

Reference: Barron's (June 6, 2017) "Big Social Security Bump Could Be Coming."


Online Social Security Changes Again

MP900316845[1]The last attempt by the Social Security Administration to increase online security was a disaster that did not last long. The agency is about to try again.

It is relatively easy to log in to the Social Security Administration and get access to all of the information about your account. A few basic details are all that is required.

This has led to concerns about privacy and identity theft.

Since it does not take much for a legitimate user to log in, it does not take very much for thieves to log in either. The agency attempted to fix this problem in 2016, by requiring a two-step verification process before account access was granted.

That was short-lived, however, as many people were unable to log in to their accounts.

The agency is going to try again with a modified process, as Investment News reports in "Social Security Administration steps up online security."

In its last attempt, the agency sent users a code via cellphone to verify their accounts before they could log in. That was a problem, since many elderly people do not use cellphones.

This time around, the agency will let people choose to have the code sent by cellphone or email. It is assumed that if are trying to access their Social Security accounts online, then they will almost certainly have email accounts, even if they do not have cellphones.

This change is scheduled to take effect on June 10, 2017.

Anyone who has problems accessing their Social Security accounts online after that, should speak to the Social Security helpline.

Reference: Investment News (May 15, 2017) "Social Security Administration steps up online security."


Social Security Myths

MP900442211[2]A recent survey found that most Americans think they know how the Social Security program works. The same survey found that most actually have some important misunderstandings about the program.

The Social Security program seems simple enough. When you reach retirement age, you can stop working and the government will send you a check, the amount of which is based upon your income during your working years.

People understand that much which leads them to believe that they know all they need to about the program.

However, a recent survey found that most people between the ages of 55-61 believe some myths that need to be corrected, as CNBC reported in "The three biggest myths about how Social Security works." The myths include:

  • Many people think that when they become eligible for Social Security, the government will know and automatically start sending them a monthly check. That is not true. You need to apply for Social Security and you need to do so, three months before you plan to receive it.
  • Another common misconception is the retirement age to receive full benefits. It depends on when you were born.
  • People also believe that if an ex-spouse claims Social Security benefits under their work history that it will decrease the amount of their benefits. This is also a myth. An ex-spouse's claim will result in no changes to any benefits that you will receive.

Reference: CNBC (April 25, 2017) "The three biggest myths about how Social Security works."


Do Not Bury Dad in the Yard

MP900382652[1]Two women in Florida have confessed that they improperly disposed of their father's body five years ago.

Fairly or not, the state of Florida has a reputation for weird news. One of the latest stories to come out of the state is not going to do this reputation any good.

The details are sparse, but two women have confessed to authorities that they buried their 94-year-old father in his yard five years ago. The man had previously been reported missing by his brother.

Law enforcement discovered the body after receiving a tip that body was buried at the house. The sisters claim they found their father dead in the house, panicked and buried him according to FOX News in "Officials: Daughters confess to burying father, 94, in yard."

The sisters have been referred to the state's attorney general's office for investigation of possible crimes of which there could be several, such as improperly disposing of human remains.

Various financial crimes are also a possibility if they used their father's bank accounts or if he was receiving Social Security benefits they used.

It is not clear why the sisters panicked and did not call authorities when they discovered their father had passed away, but it obviously raises suspicion.

Needless to say, if you find a family member has passed away, do not bury the body. Call authorities. Not doing so is against the law and could almost be considered elder abuse.

Reference: FOX News (Oct.21, 2016) "Officials: Daughters confess to burying father, 94, in yard."


Human Lifespan Limit Reached

MP900182808[1]People all over the world have been living longer and longer than in previous generations. That trend might be at its end in advanced nations.

Most people would consider the fact that Americans live a lot longer on average than they used to a wonderful development. Many would like to see that trend continue.

On the other hand, it cannot be denied that extended lifespans have put a strain on many of our important services for the elderly. Medical care for the elderly can be very expensive and that has increased the cost of Medicare.

The longer people live, the longer they collect Social Security and that safety net is under stress as a result.

From that perspective it might seem a good thing that it is unlikely humans will continue to see increasing lifespans in the future, according to a report in the Guardian "Human lifespan has hit its natural limit, research suggests."

It appears biological factors limit the human lifespan to somewhere around 115 years even when people are given the best possible healthcare. If this research holds up to scrutiny, it should assist with planning when it comes to paying for Medicare and Social Security.

Of course, there are some researchers who are looking into ways to overcome the biological obstacles and extend human life even longer. So far, they have not been successful.

Reference: Guardian (Oct. 5, 2016) "Human lifespan has hit its natural limit, research suggests."


Do You Know What You Need to Know About Social Security?

Old-couple[1]Many people rely on the information provided by the Social Security Administration to learn about their Social Security options and benefits. A recent government study suggests that they might not be getting all the information they need.

For decades the vast majority of Americans have made decisions about their Social Security benefits by asking experts about their options. The Social Security Administration has claims specialists whose job it is to provide all the important information so Americans can make informed decisions about how much they will receive and when they should start claiming those benefits.

However, a study conducted by the GAO alarmingly suggests that Americans who rely on the SSA for information are not always getting what they need to know.

This was recently reported by the Motley Fool in "6 Key Facts Social Security Doesn't Always Tell Retirees."

Americans are not always getting important information such as how the age at which they first claim Social Security benefits affects the amount of their benefits, how the amount of benefits is based on lifetime employment income, whether they are eligible for spousal benefits, and how their benefits might be taxed.

While it is to be hoped that the GAO report will lead to better information being provided by the Social Security Administration, that should not be counted on.

It is a good idea for people with questions about Social Security to seek out the advice of an elder law attorney to make sure they get all the information needed to make an informed decision.

Reference: Motley Fool (Sept. 26, 2016) "6 Key Facts Social Security Doesn't Always Tell Retirees."


Protect Access to Your Social Security Account

Elder Couple With BillsIf you receive Social Security benefits, it is very important that you that you understand how to protect your Social Security account from thieves.

Recently the Social Security Administration introduced a two-step verification process for access to Social Security account information online. Unfortunately, it required people have access to text messaging, which many senior citizens do not have.

The system had to be temporarily shelved.

That means that Social Security account information is still vulnerable according to Computer World in “Trusting the Social Security Administration?

The problem stems from Social Security requiring that all benefits be paid by a direct deposit. Identity thieves have been known to create an online account with Social Security before a retiree can do so. This gives them control of the account and they can change the account into which benefits are deposited.

As a consequence of this scam, it is very difficult for retirees to fix the problem as they do not know the login information since they did not create the account for themselves. This has been a known vulnerability for a few years. Attempts to address the problem have not had much success.

One way to help protect yourself is to make sure you create an online account with the Social Security Administration before any identity thieves have a chance to do so. However, that will not protect you should someone gain access to your account later.

For the most protection it is suggested that you block all online access to your Social Security account, which you can do at any time.

Reference: Computer World (Sept. 4, 2016) “Trusting the Social Security Administration?


Social Security in Foreign Countries

Whether you are currently working in a different country or planning to move to one after you retire, it might still be possible for you to receive Social Security benefits.

Increasingly more and more Americans are working in foreign countries or they are planning to live in one after they retire. In a globalized economy, this trend can be expected to continue.

Americans in either situation need to know what their rights are in regard to Social Security benefits and any benefits they might have in a foreign country’s retirement program.

Recently, Public Opinion gave a quick rundown in “Social Security: Retiring overseas? What you need to know to get benefits abroad.”

Bigstock-Large-Mixed-Race-Family-2589417_(2)[1]If you have worked in the U.S., paid into the Social Security program and worked in a foreign country with a public pension program, then you may be eligible to combine payments from both programs when you retire.

The U.S. has treaties with 25 other nations that allow for this. The details differ depending on the country in question and there are provisions to make sure people cannot draw full benefits from both countries and get a windfall.

If you plan to move overseas after you retire, then you might still be eligible to receive your Social Security benefits. Most American citizens should be able to receive benefits wherever they go.

On the other hand, it is much more complicated for resident aliens who have lawfully paid into the system and wish to leave the country after retiring.

Anyone in that situation should seek the advice of an elder law attorney.

Reference: Public Opinion (Sept. 4, 2016) “Social Security: Retiring overseas? What you need to know to get benefits abroad.”