Receive Up To an extra $1,500/Month Using a Restricted Application When Applying For Social Security
Troy Sharpe: Taking Social Security is one of the biggest decisions you’ll make in regards to your retirement income. When you take it and how you take it impacts everything else. In this video, I’m going to show you a planning technique that we’ve used over the years to help some families get tens of thousands of dollars additionally from Social Security that they were completely unaware of.
Hi, I’m Troy Sharpe, CEO of Oak Harvest Financial Group, CERTIFIED FINANCIAL PLANNER™ Professional (CFP®), and host of the Retirement Income Show. Okay, to use this planning technique, there are a couple of rules that you need to be aware of. First, you need to have been born before January 2, 1954. The rules changed a few years ago when it comes to filing for Social Security. This is what’s called a restricted application. This has been taken away for those born on or after January 2, 1954.
If we see this example right here, we have Joe, who’s 67, Mary, who’s 67, both of them have worked their entire careers. Joe decides at full retirement age, he’s going to take his Social Security benefit of $3,011 per month. This is the maximum Social Security income you can receive at full retirement age in the year 2020, this year. Mary, she says, you know what, I don’t want to take my Social Security yet, I’m going to let it defer because at age 70, I’m going to receive $3600 per month.
When you defer Social Security from your full retirement age all the way to age 70, you receive an 8% increase to your benefit. It’s an 8% simple interest increase to your full retirement age benefit. If Joe waited, his would be a lot more, but Joe doesn’t want to wait, he wants to get his $3000 a month. Mary, she says, you know what Joe, you take your Social Security, I’m going to wait, I want the higher benefit because I’m healthy, I’m going to live a long time and I want more income from Social Security.
What Mary is failing to do here, which can help you if you’re in this situation where you’re born on or after, or excuse me on her before January 2, 1954, is Mary should file a restricted application. Once Joe files for his benefits, Mary is entitled because she is at her full retirement age as well, 50% of Joe’s Social Security check, which will still allow her benefit to continue to increase.
Mary could be getting an additional $1500 per month while her benefit continues to roll up without having any impact on it whatsoever. $1500 a month, that’s $18,000 per year, over the next three years. That’s about $54,000 in additional income from Social Security that Mary could be receiving by using this restricted application technique.
This happens about 10 times a year where a family will come in, a prospective client, and we’re doing a retirement income analysis, a Social Security, a tax analysis, an investment analysis, looking at our full Oak Harvest Retirement Process process and putting a plan together, and we’ll find out that they’re leaving sometimes $1500 a month, $1,000 a month, which again, this equates to $10,000, $20,000, $30,000, $40,000, $50,000 over the course of a few years that they are potentially leaving on the table. This is not an infrequent occurrence, it’s something we see pretty frequently.
I encourage you to have a retirement income analysis, a Social Security analysis because even if you’re not in this situation, there still are other planning techniques and other strategies that you can use to help maximize your benefits. If you liked this video, make sure to share it with a friend or a family member, hit that thumbs up button, hit that subscribe button, and we’ll see you on the next video.
