Social Security Column
September 2009
By Karyl Richson
Social Security Public Affairs Specialist in Milwaukee, WI


Financial Planning is not just for people nearing retirement.  In fact, it’s a good idea to begin planning for a comfortable and secure retirement when you’re

That’s why Social Security has a new financial planning tool especially for the 25 to 35 crowd.  It’s a special mailer with information about Social Security,
savings, and other items of interest to young workers.  If you’re between the ages of 25 and 35 and you work and pay Social Security taxes, you’ll get this
automatically with your next Social Security Statement.  

Social Security is the foundation for a secure retirement, but was never intended to be your only source of income when you retire.  While Social Security
replaces about 40 percent of the average worker’s pre-retirement earnings, most financial advisors say that you will need 70 percent or more of pre-
retirement earnings to live comfortably.  Even with a pension, you will still need to save.  If you will not have a private pension, you will need to save
more — and start saving sooner.  Today’s young workers can expect to spend 20, 30 or even more years in retirement, so saving is critical.

Want to start planning your future?  There are some easy ways to do so.  Take a look at Your Social Security Statement, which you’ll receive in the mail
about two to three months before your birthday, as well as the helpful two-page insert tailored specifically to workers ages 25 to 35.  

Pay close attention to the information provided, including tips on saving, getting your employer to help with matching contributions to retirement plans,
and how much of a difference beginning to save early can make.  There’s even a graph showing the significant difference saving over time can make,
even if it’s just $25 or $50 a week.  

The insert also includes helpful links to outside websites that can help you.  For example, you can go to for information on getting
credit, paying for education, buying a home, creating a budget, starting a business as well as financial calculators and planning tools.  Or, visit www. for a worksheet that will help you establish a budget to meet your financial goals.  These and other financial links on the insert will
help you become the master of your own financial future.

Don’t forget that Social Security coverage is not just for retirement, but also for disability and survivors benefits in the event that you are unable to work,
or you leave behind a family that depends on your income when you die.  Read more about retirement, disability and survivors benefits at

# # #


Hurricane season is here for many parts of the country.  In other areas of the nation, it’s wildfire season.  As you prepare for the threat of a natural disaster
in your community, put signing up for Direct Deposit at the top of your “to do” list.  Doing so can eliminate the delay or non-delivery of your monthly
payment if a disaster forces you from your home.

For years, Direct Deposit has been the safest, fastest and easiest way for people to receive their payments — and it still is the best way to get benefit
payments for people who have a bank account.   Here’s why.
Direct Deposit is safe.  Your money is deposited directly into your account at your bank or other financial institution.  Because it’s transferred
electronically, there’s never a risk of your check being lost or stolen.

Direct Deposit is quick.  You’ll get your payment faster when it’s deposited directly into your bank account.  Your money is immediately available to you
once it’s deposited.

Direct Deposit is convenient.  No more standing in line at the bank to cash your check, or leaving your house when the weather is bad.  It’s nice to know
your payment is safely in your bank account instead of the mailbox when you’re out of town or, worse, displaced from your home by a disaster.

For those who don’t have a bank account, there’s Direct Express.  With Direct Express, we automatically deposit benefit payments to a person’s Direct
Express card account.  The card can be used to make purchases, pay bills or get cash at thousands of locations, and most services are free.  To learn
more or to sign up for Direct Express, visit

To learn more about Direct Deposit of your benefit payments, and to sign up, visit our website at  You also can call us at
1-800-772-1213 (TTY 1-800-325-0778).

To learn more information about Direct Express, visit

In the unfortunate event that you are displaced by a natural disaster, your benefits do not have to be.  Your payments will be safe and secure, and arrive
on time to your account with Direct Deposit or Direct Express.

# # #


These days, everyone is taking a new look at their finances — and no one is looking more closely than the millions of baby boomers who are nearing
retirement age.  While some boomers expected to retire at one of the traditional milestones, such as age 62, the current economy is forcing many of them
to re-evaluate their plans.  Many are wondering if they should work longer, or how their Social Security benefit – or their spouse’s benefit – would be
affected if they continued working.

To help them find answers, Social Security has published a fact sheet called When To Start Receiving Retirement Benefits.  You can read it online at

As most workers know, your choice of a retirement age — from 62 to 70 — can dramatically affect your monthly Social Security benefit amount.  

If you choose to start receiving benefits early, the monthly payments will be reduced based on the number of months you receive benefits before you
reach your full retirement age.  The rate of reduction will depend on the year you were born.  The maximum reduction at age 62 will be:

•        25 percent for people born between 1947 and 1958.
•        30 percent for people born after 1959.

If you wait until your full retirement age, your benefits will not be reduced.  And if you should choose to delay retirement, your benefit will increase up to
eight percent a year from your full retirement age until age 70.  However, there is no additional benefit increase after you reach age 70, even if you
continue to delay taking benefits.

Social Security also has created several retirement planners to help you make an informed decision. Social Security has an online calculator that can
provide immediate retirement benefit estimates to help you plan for your retirement.  The online Retirement Estimator uses information from your own
earnings record, and lets you create “what if” scenarios.  You can, for example, change your “stop work” date or expected future earnings to create and
compare different retirement options.

To use the Retirement Estimator, visit

Read When To Start Receiving Retirement Benefits at

And for general information about Social Security, visit

Retirement decisions are unique to everyone.  Make sure you are up to date with the important information you will need to make the choice that’s right for

# # #


If you’re a teacher, chances are you know the lessons you’re going to teach like the back of your hand, inside and out.  That’s because you took some time
and prepared ahead with lesson plans.

But how much time have you devoted to your retirement plan?

Whether you’re 30 years in, or in your freshman year as a teacher, it’s important to spend time learning your retirement plan.

You may be a teacher or other government employee covered by state or local government retirement plans instead of Social Security.  And, even if you
do work at a second job and pay into Social Security, your benefits would most likely be affected by your other retirement plan.  So take a lesson from us
and learn about two important provisions that may affect you:  the Government Pension Offset (GPO) and the Windfall Elimination Provision (WEP).  

Who is affected by GPO and WEP?
Government employees who didn't pay Social Security taxes on their government earnings are affected.  The Government Pension Offset (GPO) reduces
the potential Social Security spouse’s/widow’s/widower’s benefit amount someone could receive if he or she also receives a pension from a federal,
state or local government for work on which no Social Security taxes were paid.  The Windfall Elimination Provision (WEP) can reduce a worker’s monthly
Social Security benefit amount, if he or she also receives a pension from work not covered by Social Security.

What is the purpose of these provisions?
GPO and WEP are designed to ensure that all American workers are treated equally under the Social Security program.  GPO generally requires that
Social Security spouses’ or surviving spouses’ benefits be reduced by two-thirds of the entitled person’s government pension.  Why?  Because GPO
removes an advantage that some government workers once had.  Before GPO, a person who worked in a government job that was not covered under
Social Security could receive, in addition to a government pension (based on his or her own earnings), a full Social Security spouse's or surviving
spouse's benefit.  No other workers had this option because Social Security benefits payable to a person as a spouse or surviving spouse must be offset,
dollar for dollar, by the amount of that person's own Social Security benefit.

Similarly, WEP takes away an advantage that the regular Social Security benefit ‘formula’ would give people who have substantial pensions from non-
Social Security covered jobs.  Without WEP, a worker who spent most of his or her career in employment not covered by Social Security and who worked
for a short time to get Social Security coverage would end up with much higher benefits than if all of his or her work were done under Social Security.  
This is because we calculate Social Security benefits using a formula that gives proportionately higher benefits to workers with low lifetime earnings.
Want to learn more?  You can dig deeper, and see some examples of just how the two provisions work in real-life situations, at www.socialsecurity.
gov/gpo-wep.  Or you can call toll-free, 1-800-772-1213 (for the deaf or hard of hearing, call our TTY number, 1-800-325-0778) and ask for Social Security
publications on the Government Pension Offset or the Windfall Elimination Provision.

There’s no pop quiz now, but the real test will come when you’re ready to retire.  A little time preparing for your retirement now can help you ace your final
exam: retirement.  To learn more about Social Security, visit

# # #


If you’re planning on retiring sometime early in the new year, now is the time to apply for retirement benefits.  The most convenient way to apply for Social
Security benefits is online -- from the comfort of your home or office.  Just go to  

Our website will walk you through the online retirement application process.  We will tell you what information you will need to answer the questions on
the application.  Further, we will describe the documents you may need to present once you have submitted your application.

Before you start your application, we recommend you get an estimate of your retirement benefit. This too, you can do on the Social Security website at  The Retirement Estimator uses your personal employment history to estimate your retirement benefit.  It also will help
you to answer some of the questions on the retirement application.

You can use the online application to apply for Social Security retirement or spouses benefits if you:
•        Are at least 61 years and 9 months old;
•        Want to start your benefits in the next four months; and
•        Live in the United States.

You will want to be fully informed of your options and their consequences before applying.  The website will tell you everything you need to know about the
Social Security "basics" so you’ll be ready to retire when you apply online.

Before filing online for retirement, we suggest you have the following information on hand:
•        Your date and place of birth and Social Security number;
•        Your bank or financial institution's routing transit number and the account number, for direct deposit of your benefits;
•        The amount of money earned last year and this year.  If you are filing for benefits in the months of September through December, you also will need to
estimate next year's earnings;
•        The name and address of your employer(s) for this year and last year;
•        The beginning and ending dates of any active U.S. military service you had before 1968;
•        The name, Social Security number and date of birth or age of your current spouse and any former spouse. You also should know the dates and
places of marriage and dates of divorce or death (if appropriate); and
•        A copy of your Social Security Statement.

Even if you don't have all the information we need, you should go ahead and apply.  We will contact you later if we need additional documentation.
Applying online means there is no need for you to go to a Social Security office or wait for a scheduled appointment with a Social Security representative.  
Besides, retiring online is so easy.  You can apply in as little as 15 minutes.

So if you want to start the new year off as a retiree, or plan to start collecting benefits early in the new year, now’s the time to take action.  Don’t delay;
apply online today at