Your Social Security Benefits May Be Changing Dramatically!

As they said in the movie Jurassic Park as they went on the first dinosaur ride “hold on to your butts!”

As part of the new Congressional Budget bill, retirees may be taking another hit on Social Security.

Now they want to eliminate the ‘file and suspend’ option. This is a major change in retirement strategies for many retirees!

Section 831 of the bill states. Closure of unintended loopholes. This provision would eliminate (1) the ability to receive only a worker benefit or a spouse benefit when eligible for both, and (2) the ability of a family member other than a divorced spouse to receive a benefit based on the earnings of a worker with a suspended benefit.

The option currently allows a worker to file and suspend at their full retirement age so their spouse can collect the workers spousal benefit. This allows the worker to get 8% increases on their benefit and then collect at up to age 70 when that 8% is maxed out.

Also, the spouse was able to get their spousal benefit at their full retirement age (66 for most) and defer their worker benefit to 70 as well capturing the 8% increase.

Congress wants to eliminate this. So if passed, when you file for either a ‘spousal’ or your ‘retirement benefit’ you will automatically get the higher of the two and not have the option to collect spousal and defer your own work benefit. And a worker who files cannot suspend so their spouse can collect the spousal benefit even if the spouse did not work unless the worker collects their worker benefit immediately and not suspend it get increases.

This is not final, but expected to be voted on shortly.

All the more reason personal financial and retirement planning will become increasingly more important as it seems we can’t control what is going on with Social Security.

We all knew that the underfunding of Social Security, Medicare and Medicaid and the immense deficit with out of control spending in Washington would someday come home to roost. This is the start of what could be a lot of changes for Baby Boomers in years to come as their sheer numbers stress the system.

It’s ironic that I write this on the eve of Halloween as this is certainly no treat but it sure as heck is a trick on the American public. A government that can’t control its debt has to cut somewhere but somehow I feel there are plenty of other places and other waste we can cut rather than messing with taxpayer’s benefits that many have paid into all these years.

To see more on this bill go to

Guy A. Paredes, RFC is a Registered Representative offering securities and advisory services through Cetera Advisors LLC, member FINRA/SIPC.  Some advisory services also offered through Rockdale Financial Services, Inc., a Registered Investment Advisor (RIA).  Cetera is under separate ownership from any other named entity.

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