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AARP VA Top Social Security Questions for 2013

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Recently, over 1,200 Virginians participated in live tele-town hall discussing Top Social Security Questions for 2013. Brian Bullock of AARP hosted. Alison Shelton from AARP’s Public Policy Institute was the guest. This tele-town hall was part of AARP’s continuing effort to help our members find peace of mind in retirement. Find out what the top questions were and the answers you need to know.

Nearly 58 million Americans receive Social Security benefits – and it’s more than just retirees. Spouses, widow and widowers, and children receive benefits as well. Social Security is an earned benefit for a lifetime of work and contributions and is a key part of Americans’ retirement plan.

According to Alison Shelton, it’s important for everyone to understand how Social Security works so you can choose the claiming strategy that works best for you and your family. If you are currently receiving SS, it’s also important to know how SS cost of living is adjusted and how your benefits are affected if you’re working.

"We know Americans rely on Social Security, possibly more now than in recent years. Some people approaching retirement found their personal savings took a hit during the recession and their retirement plans stalled along with their assets. Millions of retirees, widows, children and disabled workers could not get by without Social Security. It truly is the foundation of economic security for most Americans."

Here are four key questions addressed during the recent AARP VA teletown-hall with answers by Alison Shelton:

Question: I retired at age 58. If I delay taking benefits until full retirement age will my benefits continue to increase even though I'm not paying into Social Security anymore?

Answer: While you may initially claim benefits at age 62, as long as you make no claim, they will increase up to age 70 no matter when you actually stop working. Waiting until full retirement age, or later to age 70, will result in a larger monthly benefit. For many, that will be vital in their later years. Social Security is the only guaranteed, lifetime source of income that is adjusted for inflation, so maximizing your benefit is in your best interest.

Question: What are a few things I need to understand about when to begin drawing Social Security?

Answer: There's no single "best age." It's a personal decision. The basic question is, should you start your benefit early, at 62, at a REDUCED amount, or start it later at a higher level? If you wait, your monthly check will keep rising, by between 6 and 8 percent a year, until you hit 70. (The increase is about 6% between Early Retirement Age and Full Retirement Age and then about 8% between Full Retirement Age and age 70.)

Social Security sets the amounts so that if you live to the average life expectancy for someone your age, you'll receive roughly the same amount of total benefits over your retirement, no matter when you start taking them. Factors you'll want to consider when making your decision include your health, your family's history of longevity, your need for income, your other sources of retirement income, and your plans to continue working after you start benefits.

Question: What are the Social Security work implications?

Answer: If you are below the Full Retirement Age and you exceed the limit -- $15,120 for 2013 – then $1.00 of your benefits will be withheld for every $2.00 you make above the limit. The reduction is different if you have earnings during the year in which you reach Full Retirement Age . That threshold is much higher -- $40,080 in 2013. During that year your benefit is reduced by $1.00 for every $3.00 of earnings. Your benefit is no longer reduced beginning the month you reach Full Retirement Age. In fact, the Social Security Administration recalculates your benefits when you reach Full Retirement Age and raises them so that over a number of years you will recoup benefits lost to this provision.

You must promptly tell Social Security how much you expect to earn so that the correct amount can be withheld. If you receive more benefits than you're entitled to, you'll have to pay them back. Also, you may have to pay a penalty if you didn't promptly notify Social Security.

Question: How is the Social Security cost of living adjusted?

Answer: The cost of living adjustment (COLA) is based on the Consumer Price Index (CPI), a measure of inflation that the U.S. Commerce Department calculates by tracking changes in the prices of certain goods and services. Every fall, officials examine the CPI numbers. If they show inflation, beneficiaries receive an increase in their checks starting the following January. Due to the CPI numbers, beneficiaries receive a 1.7 percent increase for 2013. There was an increase of 3.6 percent in 2012, but no rise in 2010 and 2011.

Resources Available

AARP has a Social Security Benefits Calculator and other resources available on our website,, which can help you making important Social Security decisions. Not only will it estimate how much your benefits might be, but it also takes into account spouse benefits, something that is unique for online estimators.

The Social Security Administration has important information on their website

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