5 Important Social Security Issues For Women – Community News
Social Security

5 Important Social Security Issues For Women

Social security plays an important role in total pension income. Unfortunately, many customers risk oversimplifying Social Security and may not realize there is a strategy to get the most out of it. Financial professionals can add significant value by educating clients — especially women — about their specific and unique scheduling options.

Marcia Mantell, founder of Mantell Retirement Consulting and author of: What’s the deal with Social Security for women?, and Rod Mims, SVP of National Sales at Athens USA, weighed in on five of the most common social security issues affecting women.

1. Married women should consider the possibility of solo years.

For couples nearing retirement, it’s still common for the man to have earned the woman more and even more likely to outlive him. If he claims benefits before full retirement age or FRA, he will commit a lower benefit amount that will not increase with FRA. This also results in a reduced survivor benefit if he dies. Mantell emphasizes that couples should plan together for Social Security. “Women don’t realize that the decisions their husbands make can have a long-term effect. If he claims early and locks in a reduced payment, and if he dies assuming his benefit was higher, she gets less than she could have gotten.

2. Housewives/informal carers can receive benefits.

Women are more likely than men to be employed at work and looking after children or elderly parents, making them more likely to be ineligible for Social Security on their own. “A woman may know intellectually that she has not deserved an advantage, but seeing that zero on her statement is a real showstopper,” Mantell noted. Despite that zero, a woman can get a benefit in her own name on her husband’s (or ex-husband’s) file. This is up to half of the spouse’s primary insurance amount, or PIA (the amount he qualifies for at full retirement age) — not half of what he actually collects.

3. Single divorced women can and should claim their ex’s employment history.

“When clients estimate their retirement income, there can be a lot of confusion and concern about Social Security benefits and divorce,” says Mims. An unmarried divorcee may not be aware that under certain circumstances she can claim benefits from her ex-husband’s file (including that their marriage has lasted at least 10 years and that her ex is eligible for benefits). Even knowing this, she may be hesitant to ask her ex for permission to claim benefits because she believes it will affect the ex’s benefit amount, especially after a difficult divorce. Fortunately, her claim to the ex-husband’s file is completely confidential – her ex is not notified or influenced.

4. Widows should be prepared for reduced benefits.

When a woman’s husband dies, she continues to receive the higher of her benefit or her deceased husband’s benefit. However, she still loses one benefit and at the same time moves from filing taxes jointly to a single filer. Since a widow’s retirement income is unlikely to fall much, this change could have a major impact, likely increasing the amount of her benefit subject to income tax. In addition, her Medicare Part B premium (based on income and subtracted from her benefit check) can rise significantly.

5. Teachers and other public sector employees should carefully examine their advantage.

The Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO) can reduce or even eliminate Social Security benefits for public sector employees who receive a pension in lieu of Social Security. However, women affected by this may still think they can claim as a spouse or surviving spouse, which is often not true. Mantell explains: “A lot of people have no idea about this integration between Social Security and public pensions, and it can be a very difficult situation for couples who were counting on her to get a partner’s benefit.” Determining the true benefit can be complicated — the impact varies by state, and those who have also worked outside the public sector may find that Social Security statements do not reflect the WEP or GPO reduction.

As you work with clients to take a holistic view of retirement planning, it’s important to understand the most common Social Security intricacies, including those that may be specific to women. Mims encourages starting the conversation about Social Security early. “Not only can you help your female clients get the most out of their benefits, but you’ll also get a clearer picture of the role Social Security will play, and thereby be able to more accurately identify the gap between projected expenses and retirement income.” he explains. . “Introducing a fixed indexed annuity or registered indexed annuity into a retirement plan can help close the income gap.”

Download the Social Security IQ Toolkit to learn how to connect with customers, discover new prospects, and calculate results for specific scenarios.


This material has been prepared for informational purposes only and is not intended to provide tax, legal or accounting advice and should not be relied upon. You should consult your own tax, legal and accounting advisors before entering into any transaction.

Not affiliated with or endorsed by the Social Security Administration or any government agency. This material contains educational information about the availability and details of the Social Security program and is not intended to promote products or services offered by Athens. The information represents a general understanding of the Social Security program and should not be construed as personal advice regarding Social Security, tax or legal advice. Details of the Social Security program are subject to change. A tax or legal advisor should be consulted before making a decision. Visit www.ssa.gov for more information.

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