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Virginians Can Now Replace Social Security Cards Online

Until the recent past, everyone had to visit a Social Security office to replace a Social Security card. However, over the past couple years the Social Security Administration has rolled out a program whereby residents of certain states can now replace their Social Security card online.

Now, Virginia is added to list list of states with online Social Security card replacement.

Social Security Reserves and Sources of Income

Good article which outlines how Social Security invests its current $2.9 trillion in excess reserves.

Highlights :

Social Security received generated $957.5 billion in revenue in 2016

Sources of income for Social Security :

- Payroll (FICA) taxes : 87.3 percent

- Taxation of Social Security benefits : 3.4 percent

- Interest from bonds (excess reserves) : 9.2 percent

The problem is the program expects to begin paying out more in benefits than it's generating in income beginning in 2022.

Investment Income Does Not Count in Social Security "Earnings Limit"

If you're receiving Social Security retirement benefits AND you receive income from wages, your Social Security wages may be reduced if you earn more than $16,920 (2017).

However, if you receive investment income, this will not affect your Social Security benefit.

If you have considerable investment income, this may mean your Social Security benefits are TAXED, but they will not be REDUCED.

Social Security Disability Benefits Taxable if Your "Base Income" Exceeds $25,000 or $32,000

Just like Social Security retirement benefits, Social Security disability benefits are taxable if your "base income" exceeds $25,000 (single) or $32,000 (married).

Your "base income" includes half of your Social Security benefits, plus other income (including tax-exempt interest).

Dramatically More Americans Plan To Delay Social Security Retirement Benefits

According to May, 2017 survey, only 28 percent of 61-year-old respondents said they would receive Social Security retirement benefits as soon as possible (age 62).

This is a big decline from 2008, when 45 percent of 61-year-olds said they would file as soon as possible.

There are probably two reasons for this.

One, in 2008, many seniors could not find worthwhile employment, so getting Social Security was perhaps the only option.

When to Take Social Security in Retirement - Think "MATH"

MATH translates to :

* Market
* Affordability
* Taxes
* Health

Health -> Take Social Security early if your life expectancy is limited

Affordability -> If you NEED the money now, maybe you need to start benefits

Taxes -> If you're still working, your up to 85 percent of your Social Security benefits may be taxed

Market -> If the stock market is way down, maybe you need to start benefits soon

Five Social Security "Secrets"

Here are five Social Security "secrets" according to Motley Fool :

1. Your benefits increase each month you wait

2. Your benefits are taxable (at higher income levels)

3. You may be able to claim benefits based on ex-spouse's work history

4. You may be able to claim benefits despite no work history (ex. spousal, surviving child)

5. Social Security is not going "bankrupt" (but benefits may be cut)

US CFPB Cautions About Using Reverse Mortgage to Delay Social Security Benefits

Lately, some financial advisers have suggested that seniors delay taking Social Security retirement benefits. Instead of taking Social Security at age 62, for example, these advisers suggest using a reverse mortgage to "fund" your retirement and delay initiation of Social Security benefits until later. Delaying benefit initiation means a larger retirement benefit.

However, the US Consumer Finance Protection Bureau (CFPB) has cautioned that this strategy has drawbacks. The CFPB says the best way to increase future benefits is to keep working past age 62, if possible.

Avoiding Income Taxes on Social Security Benefits Through Loans

This is an interesting paper which looks at how a relatively well-off retiree can avoid paying income taxes on Social Security taxes by taking out a loan against their life insurance policy (or, presumably against other assets).

Under scenarios studied, instead of making taxable withdrawals from their 401k, a couple could obtain similar "cash flow" by borrowing against their life insurance policy (or presumably other assets).

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