Deanna Sauceda: It is Tuesday and time for Ask Deanna. This week’s questions comes from Sue Winder: “I’m 53 and my husband is 65. If something were to happen to him, would I be eligible to receive his Social Security? And then once I reach retirement age, do I get both benefits?

Phone Voice: Please try your call again later.

Deanna Sauceda: Well, that’s what I got on one of my calls to the most obvious place to find the answer – the 1-800 number for the Social Security Administration. And if I was more patient I probably would probably would have found the answer there eventually. I tried 2 more times and I got this:

Phone Voice: Okay, I’ll transfer you for agent service. Your estimated wait time is greater than 10 minutes.

Deanna Sauceda: So I went to the yellow pages and called Action Disability Representatives and talked with John Bishop.

John Bishop: The answer is probably. If he has earned enough credits by paying enough into Social Security for her to be eligible, she would get benefits from whichever account would pay higher (pay more money).

Deanna Sauceda: Alright. So Sue, you would get his SSA until you were eligible and then the Social Security Administration does an assessment and gives you the higher of the two, but not both.

And next week’s question has to do with a favorite subject around here: fishing. [...]

This is not an error but an actual policy of Social Security. It wasn’t always that way; the new rule took effect in June 1982, as a result of PL 97-35, The Omnibus Budget Reconciliation Act of 1981 (enacted 8/13/81). [thanks to Larry]

Multiplied by 50 million SS recipients, the amount not paid out because of this rule amounts to approximately $300 million per year. What happens to this money? It’s simply not paid out and therefore remains available for future payouts. But some people are worried that somebody else might be collecting their missing cents, which is a pretty reasonable concern, but fortunately not true.

“I got a fifth-grade math problem for Social Security. The question is, I was told that I will get a benefit of $685.90 by their letter to me. But I have been getting only $685. They shortchange me by 90 cents. So my question is what happened with 90 cents? I don’t know. So I called and I was told that they just drop off 90 cents. It just disappears. I don’t know where, but it just disappears. Now, I was taught that when you round to the last one dollar, you’re supposed to round up if it’s more than 50 cents, so that makes sense that I should get a check for $686 and not $685. But they gave me $685 and they’re saying 90 cents they just drop off. They don’t worry about it.

Well, somebody is collecting those 90 cents. Now, the simple same typical math problem, we can extend that, too. Today there are 50 million people collecting Social Security checks every month. So on the average, they’re collecting 50 cents for every Social Security recipient per month and there are 50 million people so they are collecting $25 million per month times 12, that’s $300 million per year. What happened to those $300 million? Why can’t we get that back? Why are these other people, Citigroup, Bank of America, they are still getting… “

The first 5 most popular names for girls are: Emma, Isabella, Emily, Madison, and Ava. As for the most popular U.S. boys’ names, the top 5 are: Jacob, Michael, Ethan, Joshua, and Daniel. If you’d like to see more details about America’s most popular baby’s names, Socialsecurity.gov offers a new page called “Change in Name Popularity”.

Of course everybody is wondering why the name Barack didn’t make to the top 1000 most popular U.S. baby names. But the truth is Barack made an impressive jump from position 12,535 on America’s most popular baby name list to position 2,409. It took just one year for Barack to jump 10,000 positions and Social Security’ prediction is that Barack will make it to the top 1,000 most popular U.S. baby names in 2009.

This year, 2009, brings major changes in America’s Most Popular Baby Name List. There are many newcomers to the list and Isla, Mareli, Dayami, and Nylah are just a few girl names that made it to the first 1,000 most popular U.S. names for babies. As for the most popular boy names, 2009 brought new names to the top 1,000: Aaden, Chace, Marley, Kash, and Jadiel are just a few newcomers to the top 1,000 U.S. most popular boy names in 2009.

If you are wondering about Elvis, this popular boy name fell from position 673 in 2007 to position 713 in 2008.

Visit socialsecurity.gov for a complete list of the top 1,000 most popular boys’ and girls’ names for the year 2008. You can also check a list of the first 100 names for twins born last year. The Social Security website offers lists of popular baby names for each year starting 1880.

Social Security Representative: The SSI program used to be, you know, referred to as old age assistance and programs like that and what we have is that Supplemental Security Income, for individuals who are aged 65 and older, that hasn’t changed, that hasn’t increased with the full retirement age for retirement. That stayed with Medicare age, age 65.

So SSI is for individuals who are 65 and older who need help because of having limited income and resources or younger individuals who are either blind or disabled with limited income and resources. As long as you own a home and you live in it, then we are going to be fine with you having that property. We’re not going to count it for what it’s actually worth, you know, if you were to try to sell it, because if you’re living in it, you can’t really sell it. You need a place to live in.

So for SSI, we do help individuals, even if they have a fairly nice asset like a home because it’s not saleable while you’re living in it.

Social Security Representative: I was thinking a little bit about this while I was planning to give the answer. What I really wanted to add to this is that our clients need to actually ask these questions of us. You know, they’re great to talk about on our TV show, but if this is going to happen with a client, when do you think the client should come in and ask the question. You know, ten months after they got the money, or you know, when they find out that their NV will or in the state. Contact us, ask us the question, and we can help the individual to prepare better to have this money actually do have some good. You know, if you’re going to inherit $5,000 and you have to use the money for the funeral expenses, then we’re going to find a way that we don’t count this money if it’s all spent on the funeral bill.

But if you’re going to get that money and you’re going to be able to say pay off your car bill or car loan, then come in and talk to us and we’re going to advise you that the month you get the money that month you’ve got to go in there and actually pay it on this bill, so that you only lose your SSI for the one month.

But try not to ask these questions after the fact. When you’re on a benefit program like SSI, it’s best that the individual contact us. Go right into our website. We’ve got answer to some of these questions right there. You can search it out and ask, you know, income or inheritance affect benefits and the answer would be given to you right on our website, or give us a call and one of our telephone operators would be able to send you a pamphlet on Supplemental Security Income and that might explain the information a little bit better.

Social Security Representative: I like to use this question here because the answer is something that most people should just kind of understand, but sometimes people get pension systems mixed up. Social Security does not have a fixed amount for an individual when they get to be 62.

In fact, with my sister, up in Canada, they have a fixed amount that an individual gets because of being a worker in Canada and then you get something above and beyond that. Well, for workers in the United States, we look at how much you’ve earned and paid into the system to figure out how much you’re going to get.

We send out a benefit statement every year. That’s what people need to do. Pull out their benefit statement, you look to see what your benefit is at age 62, what your benefit would be at age 66, if that’s your full retirement age. Well, for that four years, if your difference is $480 and there are 48 months there, well, then you know that your benefit is going to increase $10 per every month that you wait and hold off retirement from age 62.

So do the math, do look at that benefit statement because that’s the first place that you need to start looking when you start doing some retirement planning and you don’t have to wait until, you know, a date of birth. You don’t have to work until January. Sometimes retirement plans are, you know, personal.

Senior Citizen: Right.

Social Security Representative: You know, maybe October is the right time to go out on retirement for you and you can find all that information on our website to help make those decisions.

Senior Citizen: It’s awfully hard to get along anymore without the access to the Internet, isn’t it?

Social Security Representative: Well, and that’s the thing is that if you’re paying for Internet access and you have it at home, use it.

Senior Citizen: Right.

Social Security Representative: Also, we’ve talked to a lot of individuals where the libraries have got Internet access. We have some tribal council organizations that make Internet access available to their members and so use the access where you have availability, but be, you know, safe. Be sure to come right into our website, socialsecurity.gov.

Senior Citizen: Okay, thank you, Mark.

Now, in comparison, you’re money-ahead to start with, but what happens if you outlive your retirement? You know, when you take it early and many times the breakeven point is only like 14 years into the future. Well, we were kind of comfortable with that comparison until, looking back, we realized that people are living longer. So what happens on the end of the comparison where somebody gets to be 80 and it would have been a better decision for them to have left their money in the program and not taken it out as early and their benefit would be higher for the rest of their life.

Well, what kind of economic comparison can you make between being money-ahead or outliving your retirement so that you are going into poverty levels, in some cases, by starting your retirement too early? So we’re really kind of pulling back and saying, “It’s up to the client. Let the client make their decision”. If they feel they want to take their benefit at age 64 because their brother took it at 64 and he seems to be doing okay with that decision. If a client wants to take it at 62 and they think they have thought ahead enough, we’re not going to try to give them a lot of comparisons as to, well, what’s your breakeven point.

There is no breakeven point in life, you know, and in your finances. If a stock broker would have told me what my breakeven point was a few years ago, I would have put my money in a sock under my mattress. So, you can’t always just look at the economics, sometimes you have to realize that there is no set answer into the future and we’re not really going to give people comparisons, because we’re comparing apples to oranges, and that’s not correct.

So we’re going to pretty much leave it with the client. And we have a sheet that talks a little bit about what the client should be looking at: longevity (how long they expect they live), finances (what other money they have), how they are planning on making ends meet into the future. That review, that factsheet is called “when to start receiving retirement benefits”, and the best way to get that sheet is to go to our website www.socialsecurity.gov and in the search feature just type in “when to start receiving benefits” and it will refer you to our fact sheet, and you can print it right off your computer. Of give us a call 1-800-722-1213 and we’ll send one to you.

Interviewer: Lot of unknowns there, there’s always an element of chance.

Hess: Well, and you’re one of the best people to talk to because you’ve got a lot of background in finance, in taxes and you don’t know until the dust has settled how things are going to turn out, and you can’t always be looking at the rosiest outcome because the rosiest outcome is to put your feet up, settle back in your hammock and hope that everything turns out and that you’ll have a lot of good years in retirement by taking retirement early.

But, you get to be 80 and you’ve outlived your income and bills have kept rising, your income is not staying at that same level. You have to cut back on driving, you have to cut back on living in your own home, you have to cut back on medical insurance. Well, there are a lot of things that are hard to cut back. Like this winter, cut back on heating your house just because you’ve outlived how much you needed to survive on? That’s a tough one.

So, I don’t want to be the person to advice people to take benefits early just because they’ll have more time on their hands and they’ll have money to start with when, you know, at the end they might not be living as they could be had they waited and taken retirement later.

Interview: One person said “I’ve got enough money for the rest of my life: if I die at 4 o’clock tomorrow afternoon.”

Hess: I don’t want to see people really come away from a comparison saying, “Well, I’ve got enough money to live until 79″. Well, that’s not a good decision to make because people are living longer than that. And that’s not a good decision to make. Try to maximize your income until your late 70s, because a lot of people live much longer than that.

Then, the IRS sends that information or makes that information available to us. So, we take that information and use it in calculating and verifying that a person is eligible for benefits. The IRS is the collection agency. They make sure that it’s there, they make sure that you get credit for it, and so you always have to go back to the IRS if your tax return got lost or whatever, you have to re-file it with them.

If you ever find out that you don’t have credit… well, we send a statement every year to show you how much credit you have got over your lifetime. If you find that there is a gap where your employer didn’t pay in your Social Security contribution for you and it’s not recorded, you can come to us, and we’ll help you get credit for that. But everything goes to the IRS, then it comes to us, and we use that information calculating.

Now, I would like to give the people a little caution as far as when they get that statement from us every year, if it doesn’t show their earnings are on there for last year, that’s not too worrisome, because it takes a while for the IRS to get all the W2s posted, and then that information will come to us. So, we’ll have earnings recorded, but not for the current year and one year into the past. Everything else should be on the record.

That’s a credit, and this year it’s a $1,050 that gets you one credit. During the year you can get as much as 4 credits for 4 quarters; you have to have 10 years worth of credits… 10 times four is 40 credits. So, that’s how most people have heard, you know, how do you get insured for Social Security retirement, is that you have to have that 40 credits over your lifetime and once you have that, then you have minimum protection.

I like to throw the word “minimum” in there because your benefit is based on how much you earn, not the fact that you have at least the 10 years.

So, then we go in and we look at how much you have earned over your life time to come up with the calculation of how much your benefit will be. So, you can be covered for something, but your benefit is based on how much you have made over your whole lifetime.