Nikki Foley: All right, quick. I just heard one of our advisors on the phone the other day was talking with a prospective client and the individual had shared with this advisor that they are age 76 and have not started social security yet.

Jeff Quick: Yeah. I’ve never heard that one before.

Nikki Foley: So, yeah, you did say though one to me when we were talking here that you did have a client that you were able to go back. Tell me that story that’s

Jeff Quick: Yeah, I had a client probably my first few months here, came to a seminar, came in and gathered all their information and I said, “I might be calling you shortly.” I said, “I think you’ve been missing out on your social security benefit.” I was 90% sure, but I didn’t want to say anything until I had it all checked out. And I ran it through, you know, the social security maximization software and it came back and yes, they should have already had filed at least the spousal benefit. And we end up going back six months, so they got one nice check for six months worth of social security. That’s as far as they allow you to go back. And then they started receiving benefits. So, nice way to start off a relationship just handing somebody a check, right?

Nikki Foley: You think that social security is cut and dry and I’m not sure that it is. I feel like there’s a lot of moving parts to it.

Jeff Quick: There still are, not as many as there were, but there’s still some things that can be done, you know, especially if you have age gaps and income gaps, you can do some fun stuff still.

Nikki Foley: Well, Quickster, welcome to Paladin Financial Talk. Today we’re going to cover social security and we are going to get into the nitty-gritty on not the retirement benefit piece, but survivor and dependent benefits. If that sounds good to you.

Jeff Quick: All right.

Nikki Foley: All right. Well, I have been asking, well, let me tell you just a little bit about what we’ve been doing here. We’re in a six-part series on social security and so we’re really trying to break down social security into bite-size pieces and so up to this point we started with Ellie and Jack cover kind of an overview of social security and then Jeff Foley and I last week went through retirement benefits and so you and me this week on the survivor and dependent benefits and so our goal is simple just to help our listeners better understand the system know the benefits available to them and just make more informed decisions about social security but I’ve started each one of these episodes with the question of I want your perspective what is the number one question that you get asked as an advisor related to social security and what’s your answer?

Jeff Quick: Yeah unfortunately it’s probably the same thing everybody says when should I file for social security?

Nikki Foley: Ding. Ding. Ding.

Jeff Quick: And the answer is it depends.

Nikki Foley: Ding. Ding. Ding.you are spot on with what Jack and Jeff have previously answered and so we’ll get into what this looks like and today like I said we’re going to focus on dependent or survivors and the children potentially but as I say that I know that’s even inaccurate and I’ll let you explain what is inaccurate about what I just said there so my question is when we hear social security survivor benefits most people probably think of a widow or widower but there actually could be others that might fit into these benefits when a worker dies. Can you take us through that perspective?

Jeff Quick: Yeah I mean I’ve actually dealt with this unfortunately in the past I had a friend of mine actually passed away early and had three young boys and I went to the social security administration’s office with his wife and helped her file so there are a lot of benefits for children especially if they’re minors still in high school they can receive a portion of the benefit as well and it’s actually a fairly high percentage of what social security does pay out I don’t remember the exact numbers but people don’t think about that they only think about you know the retirement benefits that it supplies.

Nikki Foley: Yeah absolutely so widow or widower, divorced spouse can also fit into that dependent children surviving spouse caring for an eligible child and this is one that I had not really thought about and I was recently reading something and it’s could be financially dependent parents as well. So, that spectrum is fairly large and I also had a situation that had a good friend pass away and you know, the kids are now part of that and so any perspective on like the kids and the ages or anything that you want to share that might help our listeners today?

Jeff Quick: I just think it’s something anytime you have a life change, a death or a birth of a child, anything like that, you want to always check and see if there’s benefits provided for you. Social Security being one. I even know that from my own experiences, a premature child, there’s benefits supplied for it. So, there’s a lot of situations where there are benefits that you may not know about and a lot of times unfortunately people aren’t going to tell you about it without you asking.

Nikki Foley: One thing that I again, I was reading an article recently or going through some education and a worker who dies young doesn’t necessarily need the traditional 40 Social Security credits for that family to qualify and so, there are a lot of moving parts and unique scenarios that as Jeff has said here, dig in, you might as well call, you might as well see what is out there and even if the answer in some of these cases aren’t what you’re looking for as maybe you know, as big as you’re looking for, something might be available. So, absolutely take into consideration that these aren’t just talking about the surviving spouse, but it expands beyond that definition. And so, what actually happens Jeff to Social Security when one spouse dies? For example, you know, both spouses are receiving their Social Security check and one spouse dies, what happens?

Jeff Quick: Yeah, the easiest way to think about it is the surviving spouse ends up receiving the higher of the two benefit amounts. Now, that’s not really how it works, you really get your own plus they make up the difference between the higher earning spouse, but the math is the surviving spouse receives the higher of the two Social Security benefits.

Nikki Foley: And so, when somebody passes, do they just call Social Security? Is that the next step in understanding?

Jeff Quick: That’s a good step. I mean, give them a call. They won’t tell you when or how to file, but they will tell you what’s available and give you some direction next steps. So, that’s a great place to start. And of course, your financial advisor is also a great place to go and check in. Absolutely.

Nikki Foley: And so, one of the pieces that we offer, and it’s actually our download for this episode in this entire series, is our Social Security Maximization Report. And you mentioned it in our beginning conversation there, is because there are so many moving parts and things that you might be eligible or not sure exactly how they work, that’s a report that we try to keep up-to-date on a regular basis, or especially as somebody has a life-changing event, so that we can run some numbers in making sure that you are getting the maximized or optimized benefit that you’re eligible for.

Jeff Quick: 100%. It’s a great one to have a rerun, too, as well. I will rerun that for my clients if it’s been a while since we’ve done that, because things change, Social Security amounts could change. You know, life events happen, so you know, you may look at Social Security differently than you did day one when you started working with us.

Nikki Foley: Absolutely. And if anybody is listening and missed our last two episodes, Jeff brought up some topics that we have covered in our previous two episodes, is go back and listen to those and understand where you might have some gaps in something that Jeff just said there. So, how about this one? I don’t think most parents realize that Social Security can provide benefits to children. So, you have gone through an experience, I’ve gone through a life experience, and we have seen that. So, if a worker retires or if a parent dies, like we have talked about, and the children are still young, what benefits could potentially be available to that family? Go through that in both of those situations. If somebody retires and they have young children or if somebody dies.

Jeff Quick: Yeah, if somebody retires and they have young children, you know, in high school or beneath the age of majority, if they’re 18 or up to 19 and still in high school, they can receive benefits if their parent is si- you know, old enough to be collecting social security, there’s benefits available for those children. And then unfortunately, when a parent passes away, there are benefits for those children as well and it can be quite significant. I talked about my client had three young boys. All three of them received benefits from social security and it’s typically between 150 and 180% of the total family benefit can receive. So, up to 75% of the deceased parent’s PIA, they’re eligible for. Yeah. So, it can be a significant amount.

Nikki Foley: There is a family cap on that as Jeff was saying, but yeah, when you look at those numbers and you start adding those up, those can make a real difference for a family. And you know, you even think about that with life insurance. I’m kind of getting us, you know, segued to a different, you know, topic, but when you think about retirement planning, but even just family planning, life insurance fits into that or financial planning as a whole. And that’s something to keep in mind when you’re talking about life insurance and how much coverage you might need as a family. Well, if somebody did pass away, a parent did pass away, it’s another consideration that social security comes into play as well.

Jeff Quick: It does. You can take that into account. I typically look at social security as a standalone product. I don’t take into account any life insurance provided through an employer, right? That’s not guaranteed. And social security, hopefully it’s going to be there in the same way it is today, but that could be, you know, decreased at some point. So, yeah, take it into consideration, but try and cover yourself with that life insurance. Just something that you know is going to be there, which is one of the best things about life insurance. You pay your premium, you’re going to get the benefit.

Nikki Foley: Yeah, so all the things to keep in mind as you’re looking at your overall financial plan. These don’t live in a silo all on their own. It’s the overall conversation, excuse me, about social security, about life insurance, and how they all play together. So, one thing I think you could be surprised by if a surviving spouse qualifies for both her own social security benefit and a survivor benefit, do they simply receive which one is larger, or is there actually some strategy behind that?

Jeff Quick: Yeah, there can be strategy behind that. A surviving spouse, if the other spouse passes away, number one, you can start receiving a benefit from social security as early as age 60. And you can take the lower of the two amounts sometimes early on and then switch to the higher amount later. Upon full retirement age is typically where that would happen. But, there are definitely some things that can be done to improve the total dollar amount you receive from social security. So, again, consult with your financial advisor or somebody that’s an expert in social security because there can be quite a bit of difference. And at a time when you really need the money and as much as possible. And the benefit’s there to be used. So, be sure you’re taking advantage of it and getting all the money that you’re qualified to receive.

Nikki Foley: I just had a scenario, Jeff, that I ran last week that I had a situation with a couple that was actually retiring a little bit early, both husband and wife, and it was optimized when she took hers at 62, then she moved to a spousal benefit, and then she moved to a survivor benefit. And so, it is not you know, just cut and dry at 62, full retirement age, or 70. You can definitely have a lot of variables that can go into it and switch among benefits.

Jeff Quick: Again, especially if there’s two things to look for. Number one that it makes it more opportunities available to you is if there’s an age difference between the two spouses. And then if there’s a lifetime earning difference between those two spouses because that survivor benefit can be huge. It’s not all about, you know, what can I get today, but you want to look at that overall picture and make some plans accordingly.

Nikki Foley: Absolutely. So what you said there Jeff that I heard and I think it’s a good thing for people to tie back to if there is a difference in age or a difference in lifetime earnings between two spouses, really make sure that you’re spending time on when is the right time to take a social security benefit.

Jeff Quick: Absolutely. And what all might be available not just yours.

Nikki Foley: So as we bring our discussion to a close today, do you have any recommended resources that might be great to give to our listeners that if they want more about this topic, what could they go out and search for or find?

Jeff Quick: Yeah, the best one is ssa.gov. I mean, there’s everything out there. It’s actually a great resource. There’s a lot of places you can go and try and find information. It’s difficult. They actually have a very user-friendly, I think, website and a lot of stuff that’s available. And you can count on that information being correct. If you go to, you know, some other site that somebody put together, they probably got the information from there anyways, but things do change from time to time. So be sure and go directly to the source. And then again, of course, you know, your financial advisor or come to Paladin Financial. We have all the latest sources. Our software is always up to date. We can rerun those at any time for you and get you new and updated numbers.

Nikki Foley: Yeah, and I would just, you know, to go along with the website, if you are running into a scenario, call Social Security. Get their information. Does not mean you have to make a decision that day on what they give you, but collect the information and then work with your financial advisor and see what you know the social security maximization report comes back with and take time to make these decisions to make sure you’re making a good decision or decision that’s right for you.

Jeff Quick: Yes, and know that you do have time because as I mentioned earlier you can go back up to 6 months. So it’s better to slow down, make the correct decision than to rush into something and make a decision that’s going to cost you more down the road.

Nikki Foley: Yep, absolutely. Well, if you have listened to this episode today and you are thinking gosh, I really would like more information about this topic. One of the things that we are offering first of all is a complimentary Social Security Maximization report that is personalized to you. And so there’s a template one out there available on paladinfinancialtalk.com but we will actually personalize this for you. We do have to do a quick 15 minute phone conversation to make sure we take all the appropriate information to get it personalized for you. But if you’re interested in this go out to paladinfinancialtalk.com certainly download that go to the top right hand corner and click the booking link so that we can spend that 15 minutes with you. And whether it is Jeff or another member of our team, we want to make sure that we’re getting this set up so that you can see the mathematical aspect of it that we get the timing decisions right and we really work through your individual situation. So again, go to paladinfinancialtalk.com where you can get the complimentary report and also book that 15 minute complimentary conversation. And if you’re sitting there thinking just all of this when we talk about the financial planning aspect and the different pieces that can work together like life insurance if any of that has resonated with you, make sure that you book 15 minutes with us where we’re just having a no obligation conversation and you can also do that like I said at paladinfinancialtalk.com or just call us at 651-842-8406. Jeff, is there anything else that you want to add before we wrap up on this conversation or anything that we’ve talked about?

Jeff Quick: I think you touched on it there at the end a little bit is that don’t just make this Social Security decision in a bubble, either. You can find that in hey, how should I file Social Security to maximize my Social Security income? It’s a great starting point, but you want to look at your overall financial plan and make that fit in because there’s other reasons to file at different times as well. If you’re planning Roth conversions, if you have a history of long life in your family or the opposite, there’s different things you can do. Medicare, a lot of other things come into the planning as well. So, you really want to keep an eye on that overall income and make sure your decision fits into your overall financial plan and not just the Social Security piece. It’s important, but it’s not everything.

Nikki Foley: Absolutely. Well, if you’ve enjoyed the conversation we’ve had today and you’re looking for more, make sure you’re following along with us on our social media platforms for more insights and resources that we can offer you. Find us on YouTube, Facebook, Instagram, LinkedIn, and more. And Jeff, thanks so much for joining us and having this conversation today. And thanks for listening and we look forward to seeing you on the next episode.