Changes to Social Security

Changes to Social Security: What does this mean for me?

Many of you have heard about recent changes to Social Security that came from the Federal Bipartisan Budget Act of 2015. Note that the dates below are estimated based on when the bill was signed, however, the Social Security Administration has yet to give any official guidance.

Who is affected?

· No one who is currently receiving Social Security benefits will be affected by the prospective changes.

· Married couples or divorcees age 62 or older may be affected.

· Recipients under age 62 as of December 31, 2015 will be prevented from utilizing certain advantageous “spousal” strategies.

What is being eliminated?

· The spousal strategy called “Restricted Application” which allows one spouse to collect on his/her spouse’s benefit while deferring (and increasing) their own benefit is being eliminated for all people under age 62 as of December 31, 2015.

· In order to implement the “Restricted Application” strategy, the other spouse needs to have filed for his/her own Social Security benefits and be Full Retirement Age. The option that allows that filing spouse to “File and Suspend” (not actually take benefits) is being eliminated as well as of April 30, 2016.

What does this mean for you?

· If you are 66 or older now — or will turn 66 by May 1, 2016 and have not filed for benefits or filed and suspended your benefits — there might be an advantage in doing so immediately (before May 1, 2016) if your spouse is age 62 or older by December 31, 2015.

· Generally, widows and widower benefits won’t be affected by the new law.

· Divorcees (married 10+ years) will only be able to claim a spousal benefit at age 66 if they are age 62 by December 31, 2015.

We are continuing to review specific family situations, but we suggest being proactive. Depending on your situation, we recommend that you contact us or the Social Security Administration with questions.