I am always reading about the future of Social Security. Recently, I read that in 2016 we will begin paying more in benefits than we collect in taxes, only 7 more years. Without changes, by 2037 the Social Security Trust Fund will be exhausted and there will be enough money to pay only about 76 cents for each dollar of scheduled benefits.
Saving is even more important and in this economy even harder. But, it is essential that we save which for most of us means to stop spending. The money to save has to come from somewhere and if our economic situation does not change, then not spending is our savings program.
Give your comments and thoughts here or contact us at www.ythlaw.com
Showing posts with label social security. Show all posts
Showing posts with label social security. Show all posts
Friday, October 2, 2009
Thursday, July 30, 2009
Social Security - Myths and Facts
As part of our Elder Law work, we often address social security questions. I recently read a good article by Renee DeFranco, Social Security Myths Debunked, which addressed 7 important social security questions. Here are 2 of the questions with part of the answers and a link to the article so you can review the other 5 questions and answers.
Q: Social Security is predicted to run out of money within the next 30 years. Should we start collecting as soon as possible, at age 62, before there's nothing left to claim?
A: According to Social Security commissioner Michael J. Astrue, benefits for today's retirees are safe. However, if nothing is done to reform the system, the trust funds will begin to lose money in 2016 and will run out by 2037. A Social Security spokesperson John Shallman assured that Social Security tax income would be enough to pay roughly 75 percent of scheduled benefits through 2083. However, if the thought of insolvency keeps you up at night, it might be better to cash in early.
Q: Do I have to pay income tax on my Social Security benefits?
A: Less than one-third of current beneficiaries pay taxes on their benefits, according to the Social Security Administration. The rule: If you file a federal tax return as an "individual" and your total income is more than $25,000, you will have to pay taxes. If you file a joint return, and you and your spouse have a total income over $32,000, you will also have to pay taxes. Consider having taxes withheld from your Social Security checks.
For the 5 other questions and answer visit www.comcast.net/finance/forwhatitsworth/145/socialsecuritymythsdebunked/
Feel free to leave your comments or contact us at www.ythlaw.com
Friday, June 19, 2009
Retirement insurance and financial planning
Most of you have heard and all of you know that Social Security should not be your only nest egg. First of all, as have been covered yesterday, Social Security may not be around for everyone, definitely not in its current form.
That being said, it should have always been understood that Social Security is intended to supplement, not replace, the total financial resources needed by a worker at retirement. Social Security retirement benefits replace about 40 percent of an average wage earner’s income, less if the benefit is permanently reduced due to early retirement. The belief is that at retirement age your financial needs are reduced. The mortgage on your home is paid off or you downsize to a smaller home. Your children have left home and are independent or possibly providing assistance to you. You have no long term care health needs.
Ok, is this the reality for most retirees? How many are still paying a high mortgage? How many still have kids at home, grown or otherwise? Many financial planners suggest that 70–80 percent of an average wage earner’s income will be needed for a comfortable retirement. Our changed reality demands more advance planning for retirement than most people have realized.
Let us help you plan. Visit us at http://www.ythlaw.com/ for a free phone consultation. Feel free anytime to leave a comment.
That being said, it should have always been understood that Social Security is intended to supplement, not replace, the total financial resources needed by a worker at retirement. Social Security retirement benefits replace about 40 percent of an average wage earner’s income, less if the benefit is permanently reduced due to early retirement. The belief is that at retirement age your financial needs are reduced. The mortgage on your home is paid off or you downsize to a smaller home. Your children have left home and are independent or possibly providing assistance to you. You have no long term care health needs.
Ok, is this the reality for most retirees? How many are still paying a high mortgage? How many still have kids at home, grown or otherwise? Many financial planners suggest that 70–80 percent of an average wage earner’s income will be needed for a comfortable retirement. Our changed reality demands more advance planning for retirement than most people have realized.
Let us help you plan. Visit us at http://www.ythlaw.com/ for a free phone consultation. Feel free anytime to leave a comment.
Wednesday, June 17, 2009
Social Security Retirement Insurance
As we continue our discussion on elder law, let's turn to a subject most of us may be addressing at some time. Even with the controversy over whether social security will continue, at present it is still our current system. Therefore, we need to have some idea how our specific circumstances will be affected.
Social security benefit payments would be based on how much you earned during your working career. Higher lifetime earnings result in higher benefits. If there were some years when you did not work or had low earnings, your benefit amount will be lower than if you had worked steadily.
The full retirement age is 65 for people who were born before 1938. But because of longer life expectancies, the Social Security law was changed to gradually increase the full retirement age until it reaches age 67. This change affects people born in 1938 and later.
You can choose to receive your Social Security benefits before you attain your full retirement age. If you begin to receive Social Security retirement benefits before full retirement age, your monthly payments will be reduced. Once the full retirement age is 67, the permanent reduction if you retire at age 62 will be 30 percent. Nevertheless, there are many retirees who choose to take benefits as soon as possible at age 62 due solely to the fear that Social Security is not secure and that benefits may be reduced in the future.
More on social security tomorrow. Leave your comment here or contact us at http://www.ythlaw.com/ with your questions.
Social security benefit payments would be based on how much you earned during your working career. Higher lifetime earnings result in higher benefits. If there were some years when you did not work or had low earnings, your benefit amount will be lower than if you had worked steadily.
The full retirement age is 65 for people who were born before 1938. But because of longer life expectancies, the Social Security law was changed to gradually increase the full retirement age until it reaches age 67. This change affects people born in 1938 and later.
You can choose to receive your Social Security benefits before you attain your full retirement age. If you begin to receive Social Security retirement benefits before full retirement age, your monthly payments will be reduced. Once the full retirement age is 67, the permanent reduction if you retire at age 62 will be 30 percent. Nevertheless, there are many retirees who choose to take benefits as soon as possible at age 62 due solely to the fear that Social Security is not secure and that benefits may be reduced in the future.
More on social security tomorrow. Leave your comment here or contact us at http://www.ythlaw.com/ with your questions.
Tuesday, April 14, 2009
Probate - Duties of Administrator/Executor
Many times the person appointed as an administrator or named as the executor under the will knows very little about the duties of that position. I advise my clients to tell the person they appoint as executor. It should not come as a surprise to anyone. I then let them know what that person's responsibilities would be so that such information can be shared with their executor.
The main duties of an administrator (one who is appointed during probate if there is no will) or executor (person named under the will) are to:
(a) ascertain the assets subject to probate (not all assets are subject to probate, such as assets owned jointly, assets in a trust, assets transfered by beneficiary designation;
(b) gather and provide an inventory of the assets;
(c) open up an estate account (checking account) to place assets and receive other assets due the estate, including interest, dividends, and other income;
(d) determine the beneficiaries - who is going to get what and how much under the Will (if there is no Will, the state’s "interstate succession laws" apply);
(e) determine or obtain appraisal of the estate’s assets;
(f) give legal notice to potential creditors (generally done via legal advertisement - determine state or local requirements for notifying creditors);
(g) investigate the validity of claims against the estate;
(h) pay funeral bills, outstanding debts, and valid claims;
(i) pay the expenses of administrating the estate;
(k) handle various paperwork, such as discontinuing utilities, memberships and charge cards, and notifying Social Security and others of the death;
(l) file and pay inheritance tax;
(m) distribute the remaining property in accordance with the instructions provided in the Will or under intestate law; and
(n) close probate.
In some states, you may be required to hire an attorney to handle probate. In other states, you proceed without counsel. Call our office if you have a probate issue and we can help you meet the requirements.
The main duties of an administrator (one who is appointed during probate if there is no will) or executor (person named under the will) are to:
(a) ascertain the assets subject to probate (not all assets are subject to probate, such as assets owned jointly, assets in a trust, assets transfered by beneficiary designation;
(b) gather and provide an inventory of the assets;
(c) open up an estate account (checking account) to place assets and receive other assets due the estate, including interest, dividends, and other income;
(d) determine the beneficiaries - who is going to get what and how much under the Will (if there is no Will, the state’s "interstate succession laws" apply);
(e) determine or obtain appraisal of the estate’s assets;
(f) give legal notice to potential creditors (generally done via legal advertisement - determine state or local requirements for notifying creditors);
(g) investigate the validity of claims against the estate;
(h) pay funeral bills, outstanding debts, and valid claims;
(i) pay the expenses of administrating the estate;
(k) handle various paperwork, such as discontinuing utilities, memberships and charge cards, and notifying Social Security and others of the death;
(l) file and pay inheritance tax;
(m) distribute the remaining property in accordance with the instructions provided in the Will or under intestate law; and
(n) close probate.
In some states, you may be required to hire an attorney to handle probate. In other states, you proceed without counsel. Call our office if you have a probate issue and we can help you meet the requirements.
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