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Don't Make These Mistakes! Social Security Earnings Limit 2022 | Your Retirement Authority - YouTube
Channel: Mark Singer CFP Your Retirement Guide
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the new earnings limits for 2022 are in
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and i want to share with you
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six little-known facts that you need to
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be aware of so you can make sure
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that you don't make a mistake here that
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could cost you some money but before we
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get there subscribe to my channel hit
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the notifications bell i have over 30
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years of experience in this business we
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specialize in social security and the
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transition into retirement
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talk a lot with our clients and i want
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to share some of those conversations
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with you so you don't make some of the
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mistakes that others could be making so
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let me share with you why this is so
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important and i'll give you an
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illustration of this by sharing with you
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a story of a client of mine
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a number of years ago who called me up
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and said listen i want to take the
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grandkids to disney
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seemed like a pretty innocent nice thing
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to do for the family right create a
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whole bunch of memories go down to
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disney
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well bobby at the time was under full
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retirement age she was not yet 66 years
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old
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and she was collecting social security
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and she was also
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working
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part-time
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and what she had calculated sort of you
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know on the back of a napkin
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was that she needed to generate another
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thousand dollars of income and
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calculated how many hours that was going
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to be
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so that she could pay for and fund this
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marvelous trip that she was going to
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have with the grandkids so when she
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called me up i then called her
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accountant and we took a look at some of
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the numbers
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and as it turned out it was the perfect
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storm for bobby because she hit
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just the wrong thresholds at just the
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wrong time and with just the amount of
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withholdings
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the reality was she was only going to
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keep
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about eight of the eight thousand
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dollars about 22
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or about 1600
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so unfortunately my advice to bobby was
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it doesn't make a lot of sense to put in
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those extra hours we need to find
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another source
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to fund the trip
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but that's why this is so important to
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understand this
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particularly
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if you're going to be taking social
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security before full retirement age so
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let's get right to it let me share with
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you that chart as you can see here if
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you are under full retirement age
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you can earn up to nineteen thousand
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five hundred and sixty dollars
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but for every dollar over that
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and what they say here is for every two
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dollars over the limit a dollar was
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withheld
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from the benefit as important in the
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calendar year full retirement age is
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attained
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that number changes to 51
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960
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and then above that number
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for every three dollars over that number
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one dollar is withheld from your
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benefits so this is important to
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understand this is where the bobby's
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story came into account where she hit
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that threshold number not only for
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social security for her income tax and
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withholdings and therefore for her it
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didn't make any sense to go about
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generate that extra income so here are
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the six items you really need to be
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aware of and maybe the questions you
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should be asking so you can understand
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it from your own particular perspective
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so the first question is particularly if
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you're married and you're each earning
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money whose income
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are they looking at
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is it the joint household income
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or the individual so this is a little
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tricky because the taxation of benefits
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really has to deal with
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joint filing if you are a couple but
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with regards to whether or not they're
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going to withhold
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your individual benefit they look at
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your individual
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earnings
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so it's important to recognize the
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difference the second item you need to
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be aware of is
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what is the definition of income so all
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income is not created equally let me
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take you to my chart for a moment
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as you can see here
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income that does not count
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would include pension payments annuity
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payments ira distributions
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dividends
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interest income
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and capital gains
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so interest that does count really is
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what they call earned income which we
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would
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categorize it either as employment
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income or net earnings from
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self-employment so now that we know
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what income is and how they gauge
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whether or not they're going to withhold
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it
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the third item to understand is
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the withholdings
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where does it go does it go poof
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magically into the air and then it
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disappears well the answer is no
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once you reach full retirement age
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that they start to pro-rate bringing
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back that money to you but it takes some
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a number of years to get it back to you
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so you don't lose it
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but it does come back to you
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over time now i have three more items
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that i think that you need to be aware
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of but before i get there if you're
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interested in a broader picture
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in my recent book don't outlive your
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money in retirement
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you can go to our banner here the second
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chapter is devoted just to social
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security because we really specialize in
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the area of social security and you can
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find out what many of the questions and
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answers are so that you can have some
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more clarity in terms of which of the
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567 different social security strategies
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you need to claim so the next question
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is in regards to whether or not your
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spouse
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or kids
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are taking money off of your work record
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and if you're you've hit the earnings
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limits and monies have been withheld
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will it impact
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your spouse
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or kids
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benefits and the answer is
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yes
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but here's an interesting twist to this
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how about if you had been married and
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your ex
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is eligible for divorced benefits will
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his or her
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benefits be impacted because your
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benefit is being withheld or you've hit
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a threshold
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so the interesting answer is here no
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as long as you meet the criteria and
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just say basically you had been married
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for 10 years and it's been at least a
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couple of years and you're 62 years old
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then you can claim
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your benefit and it doesn't really
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matter
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what happens it doesn't really matter
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and it doesn't impact your benefit the
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other exes
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no matter how many times he or she had
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been married
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there is no impact
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the fifth item really is about
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disclosure
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should i tell social security if i'm
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going to be over the limit and i know it
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the answer is yes
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because what will happen maybe a year
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two three even four years later
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they will catch it and then they'll send
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you communications
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that will ask you to
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give back some of that money that you
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may have already spent and it may become
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a real problem
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so be upfront with them
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and let's do it honestly because it will
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come back to bite you
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and that could be a really confusing and
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messy situation to be and here's the
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last little known fact
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we'll call it the mulligan
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yes i am a golfer and i love using the
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terminology
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you can call it the redo if you like
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but if after let's say watching this
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video
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you find out that you took the social
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security at the wrong time
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and let's say you've done it within the
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past 12 months no longer just within the
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past 12 months
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you can go back in and withdraw
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your application you give back your
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benefits but you can do a redo a
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mulligan if you like if you think that
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you made the wrong choice and you want
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to redo your strategy at some point
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later on
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for more information you can go to our
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playlist
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you
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