Social Security Rules are Changing FAST!

Popular Claiming Strategies May Be Extinct

Wow! Things are changing fast! The Bipartisan Budget Act of 2015 is poised to deliver a tremendous reform to Social Security claiming strategies.

social security claiming strategies 2015 changes

For the past several years an entire industry has sprung up around Social Security claiming strategies. The big financial services firms recognized that there was a tsunami of retirees that needed help with Social Security and they invested millions of dollars into software development. Most of these software outputs were all aimed at “maximization strategies.” The goal was to use claiming strategies to get the highest amount of lifetime benefits available.

Now it looks like the party is over.

Under the “Social Security Benefit Protection and Opportunity Enhancement Act of 2015,” popular claiming strategies such as “File and Suspend” and “Restricting the Scope of Application” may be gone for good.

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“Social Security Is So &#%!@ Complicated!”

Under normal circumstances, my office walls don’t hear much profanity or coarse language. I suppose that day wasn’t normal.

Confused about Social Security

My client was mad. “Devin, why is Social Security so &#%!@ complicated?”

Thankfully, he wasn’t mad at me but at a screwed up system that is often incomprehensible.

If you are one of the few who believe Social Security is easy to understand, read this excerpt from their rules.

“We consider that an initial determination is correct even if we send an incorrect notice.”


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What You Should Know About The Government Pension Offset

If you have a pension coming from work where you did not pay Social Security tax, you need to know about the Government Pension Offset. Why? If you are affected, it could drastically reduce, or even completely eliminate, your Social Security benefits.

Social Security's Government Pension Offset Unfair

I’ve had more than one client who was shocked to find out they would not receive a spousal or survivor’s benefit due to the Government Pension Offset. It can seem incredibly unfair and can be a nasty surprise. Especially if you’ve been planning your retirement income with this stream of payments calculated in.

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Check Your Social Security Earnings Statement Before It’s TOO LATE

If your Social Security earnings have been recorded incorrectly, it could make a big difference in your benefit amount. You need to check for errors TODAY! Whether you are close to retirement, or in your early working years, this is not something that can wait. Why? The Social Security Administration imposes time limits on correcting your earnings record. Even if it’s not your fault!

Social Security Earnings Statute of Limitations

Mistakes in the Social Security earnings record are fairly common. For proof, look no further than the Earnings Suspense File. (This is where earnings reports are stored that have a mismatched name and SSN combination.) Since the inception of Social Security, there have been a total of $1.2 trillion in wages that could not be matched to an earnings record and thus were added to the Earnings Suspense File. In tax year 2012 alone, the Social Security Administration reported $71 billion added to the file!

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Medicare Open Enrollment


Below is a timely reminder of the Medicare Open Enrollment Period from our friends at The Barnette Agency.

medicare open enrollment

It’s that time all over again. The Medicare Annual Enrollment Period begins October 15 and runs through December 7 (Pearl Harbor Day). Missing those dates can have dire consequences. It is important to remember that Medicare Prescription Drug plans and Medicare Advantage Plans are all under year to year contracts with Medicare. Therefore Medicare Insurance plans, as they are called, can significantly chance each January 1, resulting in big surprises to you if caught off guard.

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Should Ministers Opt Out of Social Security?

Examining The True Cost of Opting Out

If you are a minister, you have several key tax issues that makes you uniquely different from other taxpayers. These differences include the housing allowance, self-employed treatment for W-2 wage earners and the big one…the ability to opt out of Social Security.

All of these tax differences can create a great deal of complexity, and should only be handled with a team of competent tax and financial advisers. However, the ability to irrevocably opt out of Social Security is probably the most complex financial planning issue for new ministers as it carries a high degree of long-term consequence if the wrong decision is made.
Should Ministers Opt Out of Social Security


If you are a new minister, I know this decision can be complicated. It’s more than just a financial decision.  If you opt out, you must agree to the following language:

I certify that I am conscientiously opposed to, or because of my religious principles I am opposed to, the acceptance of any public insurance that makes payments in the event of death, disability, old age, or retirement; or that makes payments toward the cost of, or provides services for, medical care. 

That’s weighty for sure, but my focus for this article is not to debate the ethical and moral issues of opting out, the good Lord knows there’s already been plenty written about that.   My goal is to examine the economic aspects of opting out.  Specifically, I want to help quantify what it would take to replace the benefits that you’re walking away from.

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