Social Security Basics
Chapter 1: Getting Started with Social Security
Chapter 2: Retirement and Family Benefits
Chapter 3: The Election Claiming Decision
Chapter 4: Social Security Optimization
Module Overview of Topics Covered
Most retirees are confused and misinformed about the topic of Social Security and many are seeking expert advice. As professionals working in accounting and finance, many of you may be getting questions from your clients about their Social Security benefits.
This first module will provide you with detailed basic Social Security information that pertains to all retirees, including a history of the Social Security program, how funding works and how benefits are calculated, descriptions of benefits available for married, single, divorced and widowed retirees, and critical information to consider when evaluating the election claiming decision. Case examples will be used to illustrate the most commonly used rules and strategies needed to optimize Social Security benefits through the comparison of best versus worst claiming decisions.
Financial professionals who are confident in their understanding and knowledge about Social Security will quickly become the "go to" resource, not only in their own organization, but community-wide. Social Security expertise builds trust and adds value for existing clients and is a topic that easily attracts prospects.
Upon successful completion of Module I, participants will be able to:
Choose the most commonly used terms and acronyms using the Social Security definitions learned in the course.
Identify the effect of life expectancy on lifetime Social Security income amounts and survivor benefits using a given couples' case example.
Recognize important Social Security program historical facts and changes to the program.
Recall the funding mechanisms of Social Security, including the maximum taxable earnings amounts.
Specify the steps used to calculate a retiree's PIA.
Calculate a client's PIA given their AIME.
Choose the full retirement age (FRA) for a retiree given their birth year.
Select the correct amount of annual decrease or increase in Social Security benefits for retirees who claim prior to their FRA or after that date.
Identify the current year earnings test income limits and the amount of Social Security benefits to be withheld given a retiree's age and earnings.
Recognize the rules and requirements for retirees to collect spousal and survivor benefits.
Specify the factors that determine eligibility for domestic partners to collect Social Security under the spousal rules.
Recall how quarters of coverage are calculated and the number required to qualify for Social Security benefits.
Fields of Study
Social Security Advanced Topics
Chapter 1: Claiming Strategies
Chapter 2: Pensions and Social Security
Chapter 3: Social Security Income Taxation
Chapter 4: Disability
Chapter 5: The Future of Social Security
Module Overview of Topics Covered
Every year more retirees see their Social Security benefits subject to Federal income tax, due to the taxation threshold limits that have not been adjusted for inflation since their initial inception in 1983 and 1994. This critical fact makes the timing of collecting benefits and withdrawal of funds from taxable retirement and other investment accounts, an even more complicated decision for retirees each year.
Module II begins with a description of the Social Security program rule changes included in the Bipartisan Budget Act of 2015. The legislation contained changes to Section 831 of the Social Security program that phased out two couples' claiming strategies.
The "restricted application" claiming strategy is still available in the coming years, but only for couples in which one or both were 66 or older by the end of 2019 (and including January 1, 2020). The strategy will be explained, including which age group is affected, the phase-out timing for the rule and a case example.
The Social Security income claiming decision is often more complex for retirees who have special situations such as minor children, a dependent parent, a disabled adult child, or a pension from non-covered employment. Also, due to the earnings test, those who are still working between the ages of 62 and FRA and also collecting Social Security benefits, may discover upon filing their Federal income taxes that some of their future benefits will be withheld.
Module II covers family maximum benefits, factors that make the benefit claiming decision so important for women, and in Chapter 2, the two pension related rules, the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO).
Chapter 3 of this module focuses on Social Security Federal income taxation - the history of that taxation, the method of determining if and how much of a retiree's Social Security income will be taxed, and case studies illustrating the need for education and retirement planning to include and manage this taxation.
Chapter 4 addresses Social Security disability, including the general rules, eligibility criteria, application and determination details, and family disability benefits. Like Social Security retirement benefits, disability rules are highly personal for each case and to be eligible a worker must meet both work and medical requirements.
Module II concludes with a discussion of the future of the Social Security program. Options to be considered include changing the amount of payroll tax to the Federal Insurance Contributions Act, FICA; raising the earliest age of benefit collection and/or the full retirement age (FRA) for younger workers; and adjusting the income thresholds that determine the amount of Federal taxation on benefits.
Some of the topics covered in this module may not be frequently encountered, but must be understood to provide accurate, in-depth advice when offering Social Security and retirement income planning services to a broad base of clients and prospects.
Module II prepares you for the complex interplay of Social Security income, retirement account and other investment fund withdrawals, and the impact of Federal taxation of benefits as you move on to Module III, Bridging to Retirement Planning.
Upon successful completion of Module II, participants will be able to:
Recall the two major Social Security claiming strategies that are being phased out due to changes made in the Bipartisan Budget Act of 2015.
Recognize possible future adjustments to the Social Security program that will help the trust fund to remain solvent.
Determine the monetary impact of the Windfall Elimination Provision and Government Pension Offset provisions on retirees Social Security benefits given specific case information.
Specify which family members are eligible to collect Social Security benefits based on a worker's earnings when given the family's information.
Calculate how much individual family members may collect in Social Security benefits based on the Family Maximum Benefit rules.
Estimate the Family Maximum Benefit for a given case example.
Identify the factors that support the need for women especially to fully understand their Social Security benefits and claiming choices.
Choose the correct definition of combined (provisional) income.
Recall the two different combined income thresholds for single and married taxpayers and the portion of their Social Security income than may be subject to taxation.
Define the two eligibility requirements for Social Security disability insurance.
Name the five steps in the process used to determine a worker's eligibility to receive disability benefits.
Specify which family members are eligible to collect Social Security disability auxiliary benefits based on a disabled worker's earnings when given the family's information.
Select the two amounts of Social Security benefits subject to taxation and the years those laws were enacted.
Fields of Study
Bridging to Retirement Planning
Chapter 1: Elements of Retirement Planning
Chapter 2: Retirement Income Taxation
Chapter 3: Retirement Planning Case Studies
Chapter 4: Medicare
Module Overview of Topics Covered
Planning to retire requires a major shift, from years of working and accumulating wealth to suddenly relying on that nest egg and other sources of income for the retirement years. Recognizing the value of making a smart Social Security income election decision in the context of all other retirement finances is just the start of analyzing cash flow throughout retirement years.
Chapter 1 of this module starts with a review of some important Social Security terms and abbreviations and then moves on to retirement planning 101, a discussion of the retirement planning team, retirement income streams, and how Social Security is the foundation of retirement plans.
The elements of retirement planning are described, include gathering, reviewing and assessing all retirement financial information, income, assets and expenses. A discussion of lifestyle, goals, expectations, needs versus wants and other retirement topics is critical to understanding retirees' complete retirement financial picture.
Clients should also be encouraged to evaluate their tax liability, medical, insurance, legal and legacy planning prior to reaching retirement age. This module provides a system and process to guide clients on setting goals that will allow them to achieve the retirement they desire.
Often retirees are surprised to discover their Social Security income may be taxed. The impact of this taxation can play a role in the longevity and stability of their portfolios. Chapter 2 addresses the taxation of retirement income and the importance of Social Security income taxation management in the context of overall retirement planning.
Chapter 3 will provide case studies that illustrate the tax implications from making the interrelated decisions of maximizing, or optimizing Social Security income and the sequence of withdrawals from retirement accounts and other funds. Social Security maximization may not be the best strategy when accounting for taxation and the types of retirement funds providing income. Initial software results are often just the starting point for discussions with clients about income gaps, referrals to other professionals, legacy planning and more.
Social Security and Medicare are very interconnected and no discussion about retirement is complete without a general understanding of Medicare. Chapter 4 includes an introduction to Medicare, the eligibility requirements, a description of Medicare benefits, what Medigap, or supplemental insurance plans, are available, and the Medicare application process.
Upon successful completion of Module III, participants will be able to:
Choose the common retirement planning terms and acronyms used in the course.
Select the reason(s) why Social Security income planning is the "foundation" of a retirement financial plan.
Differentiate between the funds in a retirement planning "stool" versus a retirement planning "pyramid".
Recognize how consideration and inclusion of Social Security taxation and income planning in a comprehensive retirement plan can increase the longevity of portfolios.
Determine features to consider when choosing a software to help with Social Security claiming decisions.
Recognize the difference between optimization and maximization of Social Security benefits.
Identify client information needed to evaluate Social Security and retirement financial information to optimize net after-tax income for retirees.
Recall how the timing of claiming Social Security benefits and the sequence of retirement account and other asset withdrawals can impact retirement finances.
Determine for given retirement planning case studies, the impact that claiming Social Security at certain ages can have on total taxable income and taxation of benefits.
State the four Medicare parts and the different types of care and services each part covers.
Choose the eligibility criteria for Medicare Part A.
Identify the work requirement to qualify for premium-free Medicare Part A.
Select the correct way that Medicare Part B premiums are calculated.
Recall the benefits provided by Medicare Part and Part D.
Differentiate between the various Medicare supplemental insurance (Medigap) plans.
Fields of Study
Marketing Social Security Income Planning Services
Chapter 1: Social Security Services
Chapter 2: Becoming an Expert
Chapter 3: Marketing Your Services
Chapter 4: Getting Started
Module Overview of Topics Covered
Chapter 1 of Module IV will focus on the current Social Security advisory environment and retirees' need for Social Security income planning services. We will address questions you may have about offering this service, and how changes to the Social security program can provide an enhanced marketing opportunity for providers of this service.
A detailed Social Security analysis will include a report and recommendations generated from software calculations. However, your "product" is really your expertise on the Social Security program. This requires an in-depth understanding of the rules and the ability to interpret case-specific recommendations and answer clients' questions.
Chapter 2 discusses the value of this expertise, education needed to become confidently knowledgeable and conversant on the subject and some further resources, websites, and columnists that will help keep you current with that understanding. Suggested steps to practice your skill are also explained in this chapter.
Chapter 3 begins with a general discussion of marketing service-based businesses versus those selling products. As with all service businesses, you are selling the intangible product of your expertise, and developing trust with your clients is vital to success. Especially in today's online world, the power of social networking, including referrals from satisfied clients, will play a significant role as you grow your business.
Chapter 4 includes suggestions on offering your services, the team of other professionals that can help you succeed, recommendations of both business to business (B2B) and business to consumer (B2C) marketing niches if you want to specialize, and further advertising tips that can accelerate your new business growth.
Anyone who sincerely wants to help retirees with their Social Security income claiming decision can become an expert on Social Security if they are truly "all in" with their knowledge and interest in offering this service.
Upon successful completion of Module IV, participants will be able to:
Identify factors contributing to the need for Social Security income planning advice.
Choose the correct answers to some of the most frequently asked questions about providing Social Security income planning services.
Select the impacts on the need for expert Social Security advice that result from changes to the Social Security program.
Specify useful steps to take to become an expert on Social Security.
Recall the educational resources available to Social Security income planning experts.
Recognize the options available to practice and highlight your knowledge about Social Security and your skills working with retirees to analyze their optimal claiming age(s).
Differentiate between the marketing of a service business and the marketing of a product business.
Identify the characteristics of a "trusted advisor" who offers expert advice on a topic.
Select the attributes of social networking that make it such a powerful marketing tool.
Choose other professionals who would be valuable team members to work with a Social Security expert.
Name some of the specific Social Security claiming niches available for working with groups of retirees.
Recall some cost-effective advertising tips for service businesses.
Fields of Study
Communications & Marketing
Social Security Software Case Studies
Chapter 1: Singles Cases
Chapter 2: Married Cases
Chapter 3: Divorced Cases
Chapter 4: Special Situation Cases
Module Overview of Topics Covered
The goal of NARSSA is to train you to become a Registered Social Security Analyst so that you may offer Social Security income planning and analysis for retirees.
In this final module you will learn to use the sophisticated, cloud-based analytical software program, Maximize My Social Security. The knowledge you learned in the first four modules will be applied to real-world case studies using this software.
Using Maximize My Social Security gives you the ability to examine any number of "What-If" claiming age strategies. Think of the "What-If" dates you enter in the software as optional claiming ages.
For each person, the month and year that they file and start collecting Social Security result in a different benefit amount. There are, therefore, thousands of possible collection strategies to examine, and it is only due to this type of software that we can provide retirees with this precise, personal information.
As you transition from advisor to analyst, this software program will enable you to help your clients collect tens of thousands of dollars, or more, over their lifetime by making the right choices. You will be able to easily enter your clients' data, including uploading their Social Security earnings history, with their permission, directly from the Social Security Administration website.
The software program generates custom, client-personalized PDF reports with your company's logo and contact information. It's important to review the reports' details with your clients so they can understand and appreciate your advice.
At first glance, the software program analysis may seem overwhelming due to the unique terminology used and the numerous charts and graphs. But the side-by-side comparisons between any number of Social Security claiming ages and strategies allows you to show clients the difference in amounts of lifetime, annual and, for couples, survivor income benefits.
Although the software strives to maximize the lifetime income for each case, it is often not possible for retirees to follow that particular claiming strategy. This may be due to them having to wait to claim for a number of years or to keep working longer than they'd like to. Also, the maximized lifetime income is based on our life expectancy, which is not knowable.
Therefore, the value you can provide to clients is to show and allow them to compare various amounts of annual income they will receive by filing at different ages. Using the "What-If" claiming dates, you can generate a comparison report or any number of optional claiming age reports, as PDFs, to review, discuss and provide to your clients.
Once you become comfortable with the software, you'll see the ease with which you can run one version of a claiming age decision, save it, and quickly run another to compare to the first. Often clients like to examine a number of different claiming age options to see the different amount of annual income they will be receiving.
In these cases, it is helpful to create an Excel spreadsheet so they can see at a glance the critical numbers they care about. As a RSSA, we will provide you with such a spreadsheet and the tutorials needed to create and review Social Security analyses with your clients.
In Chapter 1 you will meet Mark Hamill, who is single and will be receiving a non-covered pension in addition to his Social Security benefits. This case highlights the changes to Mark's Social Security benefit due to the Windfall Elimination Provision (WEP).
Chapter 2 presents the case of a married couple, Robert and Sarah Marsh, who have an adult disabled son Greg. Determining the best Social Security claiming dates and strategies for couples involves analyzing thousands of possible claiming ages. In this case, it is even more complex since their son is also eligible for benefits when they start collecting their retirement benefits.
Your client in Chapter 3 is a single woman Julie Woods. She was married for over 20 years and has been divorced now for about ten years. She is nearing her Full Retirement Age (FRA) and understands that by waiting to collect Social Security up until age 70, she will receive a higher monthly benefit. She is surprised to learn that she may also be eligible to collect an ex-spousal benefit.
The example in Chapter 4 illustrates the case of a self-employed attorney Thomas and his wife Anne. As the owner and sole shareholder of his company, Thomas has the option to take his compensation as a salary or as a distribution from the company. At age 60, Thomas is wondering how these two options will affect their ultimate Social Security benefits, including the survivor benefit.
In all four cases, you will be provided with the pertinent client information and their Social Security earnings histories. Videos illustrating the first three cases are included to introduce you to the software and guide you through the cases. Case 4 does not include a video, however detailed instructions will be given to assist you with the analysis.
For each of the four Social Security case examples, you will produce a PDF report that can be downloaded and saved to your computer. Some of the chapter review and module exam questions will be based on the results in these reports.
Upon successful completion of Module V, participants will be able to:
Differentiate between the WEP and GPO rules.
Recognize the reason(s) estimating maximum life expectancy is important when deciding which age to start claiming Social Security benefits.
Recall how collecting a non-covered pension can affect a retiree's Social Security retirement, spousal, and survivor benefits.
Identify why certain Social Security retiree cases will be subject to the Family Maximum Benefit rules.
Determine the difference in lifetime benefit amounts between the maximized and alternative filing age(s) for a married couple Social Security software case example.
Select the Social Security rule(s) that determine if an adult disabled child is eligible for Social Security benefits.
Choose the requirement(s) that divorced retirees must meet to be eligible to collect an ex-spousal benefit.
Recall the conditions that a retiree must meet to be eligible to use the "restricted application" claiming strategy.
Estimate the difference in lifetime benefit amounts between the maximized and the default alternative filing age for a divorced Social Security software case example.
Recognize the Social Security claiming factors that a self-employed owner, and sole shareholder of a corporation, must consider when determining whether to collect "reasonable compensation" in the form of salary or a company distribution.
Specify one of the most important issues that couples must consider when deciding when to begin collecting Social Security.
Calculate the amount of Social Security and Medicare taxes that a self-employed worker will pay on a given salary.
Fields of Study