Tax planning - Financial & Tax Architects | Retirement & Wealth Planning

How to File for Social Security Correctly “Social security is an extremely complicated program.” Senator John Thune. The traditional major sources of retirement income in the United States—often called the three-legged stool or the three pillars—are employer-provided pensions (including retirement accounts), income from assets or savings, and Social Security benefits. Social Security is a social insurance program that provides an inflation-indexed lifetime annuity to aged beneficiaries. With social security being one of the major sources of retirement income for most Americans it is important to take it in the manner that is the most beneficial for you. Did you know that 96% of Americans file for their Social Security incorrectly? And this results in average household losing out on $111,000 in lifetime benefits. Currently there are over 500 different ways that a couple can take their social security benefits and less than 20% of Americans are taking advantage of many of the various ways. It seems that the government purposely makes it complicated to know how to get the most from your social security benefits and proper social security planning is a must if you are going to get the highest benefit that you are owed. What is Social Security? To understand how Social Security works, you need to understand two terms: First is Primary Insurance Amount, or PIA, which is the monthly amount that you receive when you file for Social Security. Second is Full Retirement Age, or FRA, which is the age at which you will receive your full monthly benefit amount. To put these terms in context, say your PIA is $2,000 per month, and your FRA is 66. If you file for Social Security at age 66, you will receive $2,000 per month. So it sounds simple, but it’s not just about taking it early or late. There are two factors that determine the success or failure of filing correctly. First, when you file for Social Security benefits. Second, how you file for Social Security Benefits. How to know when to take your Social Security To determine both factors there are 3 vitally important things you must do. First, perform a Social Security Maximization calculation. This shows you how to get the most money from Social Security. Next, run a Social Security Time Value of money calculation. This calculation is based on the Maximization calculation. This shows you how to end up with the most money from Social Security Finally, perform a Social Security Optimization calculation which ensures that you take Social Security in the most effective manner for you! Unfortunately, these calculations are not available on the Social Security website. It takes a financial professional to help make these calculations. Taxes on Social Security benefits Keep in mind, it’s not about filing sooner or filing later, it’s about filing at the OPTIMAL time for you. The difference between filing at the wrong time vs the optimal time could be as much as $500,000 extra dollars in your nest egg! One important factor is the tax implications of your retirement accounts on your Social Security benefits. As you start pulling money out of those accounts, you could find that your Social Security could be reduced by up to 80% by the taxes inflicted upon it. Costing you 10’s of thousands of dollars in unnecessary taxes. With proper preparation and support from a financial professional who is a fiduciary, most of these pitfalls can be avoided and save you tens of thousands, if not hundreds of thousands of dollars Here to help Financial & Tax Architects helps individuals nearing retirement make the right decisions on their Social Security. At FTA, our goal is to provide our clients with a worry-free retirement. We have expert advisors ready to build a plan to help you get the most of your Social Security benefits. Contact us today to schedule a discovery call and find out if our services are right for you. THERE'S NO TIME LIKE THE PRESENT Let's Schedule a Discovery Call We offer a complimentary "Get Acquainted" meeting to describe our services and to see if our services are right for you. SEND

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