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PSA Social Security Mistake

March 27th, 2024 at 06:04 am

Public service announcement.  It turns out you can make mistakes for social security.  My mom found out the hard way.  For the past 10 years my mom has said "oh it doesn't matter that I collected social security at age 62.  I have enough and I'll get your dad's when he passes."  So my dad passed this month (see prior note) and my mom immediately told SS so she could get his social security.

Turns out she can't.  Or rather turns out it's not worth it.  She got really bad advice 10 years ago in 2014.  They told her taking her own social security 10 years ago was more than talking 50% of my dad's social security.  He waited until full retirement age to take it in 1995.  The problem?  While he got the maximum amount in 1995, it still was substantialy less than in 2024.  Why?  Inflation.  The person starting at full retirement age in 2024 would be able to collect at FRA $3822, if you wait until age 70 it is $4873.  

So my mom took her's at 62 with a penalty at 82.5% of hers.  That was still more than 50% of my dad's in 2014.  But the winning formula would have been to taken my dad's social security and let hers ride to age 70.  Then it would have built up a lot.  She also would have started in 2021 and it would have been really high.

So reading online, people say that the people at social security are not financial planners.  They just look at the benefits at that moment. They were correct that iwas more for her to take hers.  But she was part of the donut hole of people who could collect off their spouse and suspend theirs. 

So don't listen to the people in Social Security.  Do the cost benefit analysis yourself.

2 Responses to “PSA Social Security Mistake”

  1. terri77 Says:

    You can get ten different answers from ten different people. They are not experts so you really have to know the rules for yourself.

  2. Lots of ideas Says:

    I agree that Social Security is very convoluted and the answers you get from different people to the same question are vastly different.

    The biggest fight my brother and I ever had involved dealing with my mother’s social security. He insinuated that I was incompetent - until he went with her and realized it wasn’t me who was the problem…

    I hope your mom ends up ok financially.

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