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The Truth About Increasing Your Social Security
David GrebowWhen Social Security Forgets, You’re the LoserDid you know that only 1 in 400,000 people know about this secret provision that can help you raise your Social Security after 62? Read on and you’ll see what I mean.You’re almost there. Reaching age 62. Or you’re there already. Maybe even headed for 66 or 70. So its time to make an important decision. A decision that will change the rest of your life no matter if you live to be101.Social Security. Your Social Security. The payback for all the money they took from each and every one of your paychecks for all the years you worked. The decision is a tough one. Early Retirement at 62 starts the checks coming but at the lowest level possible. Wait until you’re 66 and you get a much higher amount every month. And if you gamble that you can make it until you’re 70, you win the Social Security Lottery, and get the top amount for the rest of your life.Here’s an example of what they tell you in Your Social Security Bulletin:Take Early Retirement at age 62, your payment would be about $1,401 a monthTake your Full Retirement at age 66 Years and your payment would be about $1,930 a monthHit the jackpot and reach age 70 and you Bonus Full Retirement would be about $2,626 a month.So if you get to 70 it’s almost twice as much every year!Now before you start to make any decisions you need to remember something. To begin with, it’s your money they’re playing with and deciding when and if and how much you get it back.Also, when they tell you once you decide to start taking it, you’re stuck at that benefit level until you die? They lie. It’s simply not true. Convenient for Social Security to keep the extra money that rightfully belongs to you. After all, that money has been borrowed for everything from the Interstate Highway project to the Wall Street bailouts.Which brings us back to the first point. It’s your money. You worked hard to earn it, they borrowed, and until they change the law, you deserve to get it back. All of it, especially when you turn 66 or 70 and your benefit levels dramatically increaseThe problem is, these hard recession day, who can wait? I know I couldn’t so I took my Social Security early when I turned 62. And like millions of other people who don’t know what they don’t know, you could be living a much richer, less stressful and absolutely nicer life. Sigh …Not much money each month to supplement what I had left in my diminished savings and crushed 401K. I said there must be a way to increase my benefits. They – the people at my Social Security office – had to be wrong when they told me “No way!” So I started to go through the stacks of SSA provisions and rules, and guess what? After months of searching through the most boring material I ever read, I found hidden treasure.Buried in one of the dusty SSA Provision Guidelines books, in Chapter 15 Right to Withdraw Application, I found what almost no one either knew or remembered. I found out that they – all the people I spoke with in person and on the phone – were wrong. And it could have cost me thousands!Here’s the right answerThere is a way, a totally legit way, of increasing your Social Security benefits as you grow older. You can start at 62 and change the benefits to the higher levels at 66 or even 70! And it’s a simple one page form that takes 3 minutes to complete.The provision was written into the Social Security rules years ago. No one I spoke with remembers exactly why but who cares? It’s there, Provision 1515, and you can use it today if you’re 62 or 66 or even 70. You can add thousands of dollars – dollars that are indexed to inflation no less – every year to your retirement.And if you’re headed towards 62, the deal is even sweeter.Here are all the benefitsSince most Boomers these days will need to keep working until at least 66, imagine what you could do investing four years of Social Security checks! How many additional bucks would that add up to between 62 and 66? Or even better, 62 and 70!I’ll use myself as an example. My check comes in every month for $1300. So this year alone I’ll bank $15,600. At a conservative 3.5% compound interest rate that becomes $546, In 4 years that becomes almost $60,000 with over $7,000 in interest. And that’s only part of the deal. Wait until you hear the details about the tax deduction, Again, it’s totally legit. Social Security set it up themselves, so you could raise your benefits as you grew older, and get a bigger Social Security check every month.They just conveniently forget to tell you if you applied early at 62.Quick ReviewJust to make sure you understand what happens when you take advantage of the rule Social Security wrote for you, here the list or at least 5 great benefits:Use this little-known rule and add thousands to your retirement for life. Complete this form and receive up to $6,230 (or more!) in one hour. Receive a completely tax-free investment thanks to Washington. Take an unbelievable one-time tax deduction for up to 8 years of your Social Security benefits. Leave more money to your survivors. Plus a whole lot more!How You Make It HappenThe approach to use is simple. It allows you to restart your benefit clock by essentially coming out of retirement using Social Security Form 521, or a “Request for Withdrawal of Application”.You then repay all the Social Security benefits received to date, and you keep any interest earned on the money. Since you we’re planning on not using the money anyway until you reach at least 66, then it should be easy for you to return the money. Then, when you pay them back, you reapply at the higher age and get the higher benefits. You can do it only once, and it is irreversible.Once the Social Security Administration approves your request, which is usually automatic, you collect at the stepped-up amount for as long as you can fog a mirror. One more added plus: Your spouse collects spousal or survivor benefits based on your increased benefits level rather than your meager early-retirement amount.Next steps on your redo dancecardSo some people think that taking their Social Security at 62 is like having a bird in the hand. This restart provision lets you have all three.So despite the common wisdom, and bad advice from Social Security, taking your benefits early can pay off big time. For example, let’s say you make it 70 and are paying back $80,000. It’s a lot of money but here’s whet you get.The money you pay back is like an investment, buying an inflation-indexed annuity from Social Security. At that age, an annuity would provide a much better standard of living until the day you die. And it’s anywhere from 30-40% cheaper that buying an inflation-indexed annuity from even the lowest cost provider. Restarting your Social Security at 66 or 70 allows you to purchase that annuity from the safest and lowest cost provider – Social Security.I know, it seems like the deal of a lifetime. It is. There are millions of Boomers between 62 and into their 70’s that can benefit from this provision and withdrawing and then reapplying.I’ve checked with my local SSA office and called the Washington, D.C. headquarters and heard the same story. Yet, from our checking with local Social Security and discussions with top Social Security officials, and once they looked up the provision, they told me applying would be routine. You go to your local Social Security office, complete the form, hand them the check, and then reapply right there and start receiving the higher benefit. According to the Social Security officials I spoke with, this is a legitimate option to consider. If it makes you enjoy a healthier and wealthier retirement, you should use it. After all, it is your money.The One CaveatNothing is perfect. Restarting the Social Security clock means you need another source of income for the years between 62 and 66 or 70. And you might not live long enough to enjoy your investment. Still, the bigger risk these days is not running out of time but running out of money or having inflation beat you to the ATM machine. Yet, as any good financial planner will tell you, an inflation-indexed annuity is the best way to go, especially when you’re 66 or 70 and headed for 100.
David Grebow spent years researching Social Security and found the truth behind what many people thought was an urban legend. It’s an almost lost and forgotten provision, that can be used by anyone to increase their benefits after 62. For more details read
The Truth About Increasing Your Social Security.