We all need to remember that Social Security was never intended to be a full retirement system. It’s intended to supplement your investments so that you will not be penniless in retirement.
Jefferson City, Missouri (PRWEB) November 18, 2015
Bert Doerhoff, CPA, founder of Aura Wealth Advisors, notes that most investors should know they will not be affected by recent changes in Social Security regulations.
Congress recently passed a budget deal that includes changes to Social Security that are being discussed by some politicians as a significant blow to retirees that are counting on a strategy called “file and suspend.”
When retirees “file and suspend,” they claim up to four years of spousal benefits while delaying taking their own benefits. In this strategy, a retiree’s fund could continue to grow while their spouse receives half of their benefit amount each month.
For example, at age 66, a retiree could file for Social Security, then immediately suspend receiving payments while their spouse still receives the spousal benefit of half the payment each month for the next four years. The retiree waits until age 70 to receive checks from Social Security, allowing their benefits to increase by 32 percent. If the retiree was going to receive $1,000 per month at age 66, instead he can receive $1,320 each month at age 70, all while collecting $500 per month through spousal benefits in the interim.
In six months, this method of claiming spousal benefits while allowing the retiree’s benefits to continue to grow will no longer be available. While the news has resulted in media attention and discussion about the loss of “file and suspend,” Doerhoff notes that most retirees do not know about this loophole thus most people are not using it.
Doerhoff also reminds investors of the purpose of Social Security. “We all need to remember that Social Security was never intended to be a full retirement system. It’s intended to supplement your investments so that you will not be penniless in retirement,” says Doerhoff. “There is also a push in the insurance industry to sell insurance and annuity products associated with social security. These are generally high-cost products that leave the retiree with less money in the long run.”
About Bert Doerhoff:
Bert Doerhoff, CPA, the founder of Aura Wealth Advisors, is a fee based investment advisor who works with families and small business owners to help them protect and grow wealth for life. He designs comprehensive tailored investment solutions with strategic defensive investment approaches that retain growth potential. Guided by fiduciary standards, he works with clients to build a legacy and deliver ever increasing cash flow in retirement that will protect their lifestyle from the effects of inflation.
Contact Bert Doerhoff, CPA, by email at bdcpa(at)AccuBiz(dot)net; by phone at (573) 634-4006; or learn more at http://www.AuraWealth.com.