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Social Security Questions
By Gary Case

Published in the Idaho Press Tribune Jan 21, 2010

In my last column I dealt with some questions regarding Social Security Retirement Benefits questions. In addition to thoughts here and my last column, our office has asked a public relations speaker to present a workshop on Social Security benefit on Tuesday, January 25th at 6:30pm in the Marriott Courtyard Suites at the corner of Overland and S. Eagle Road. Please contact our office for additional details, 466-1971 or www.idwm.net.

Many people wonder about the future of Social Security. While my crystal ball doesn’t work perfectly, the Social Security Trust Funds contains about $2.5 trillion. According to the system’s board of trustees, the existing funds and continuing tax contributions will allow payment of all benefits at current rates until 2037. After that, tax revenue projections indicate that ~78% of current benefit levels will be funded. Social Security determines the amount of your benefits based, in part, on your highest 35 years of earnings. So you might get a larger monthly benefit if your extra years of work are your top earning years.

Assuming at least some benefits will be there for you, questions as to how to best structure your Social Security benefit deserve your attention. If you begin collecting benefits prior to your full retirement age (anywhere from 66-67 for must of us under current regulations) income you earned above $14,160 in 2010 would cost you $1 in


benefits for each $2 you earn above the limit. In the year you reach full retirement, $1 is withheld from very $3 earned above $37,680 in 2010. However, your benefit is recalculated upward in following years to compensate for the money that was withheld.

If you claim benefits prior to your full retirement age, they’ll be reduced. If, for example, you claim benefits at age 62 and get $1,000/month, you could get more monthly income by waiting until age 66, you’d get at least 33% more ($1,333). If you wait until you’re 70, you’ll get at least 75% more ($1,750).

Generally, pensions, even government pensions, do not reduce social security retirement income benefits, as long as you are eligible for benefits. Of course, some Federal employees and others such as some railroad workers are not eligible for Social Security as they have not paid into the Social Security Fund. You can also collect Social Security while you are collecting Worker’s Compensation and your Social Security is protects in bankruptcy and are excluded from the disposable income calculation in a debt repayment plan.


Securities offered through Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA/SIPC. Investment Advisor Representative, Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor. Cambridge and Cornerstone Financial Planning are not affiliated.