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October 22, 2014 | by Jim Saulnier, CFP®
Know the Rules Before You File

When you're done reading, be sure to listen to our audio blog below!

Have you ever wondered about Social Security representatives and the information they provide? Sometimes it helps if you know the rules before you file for your Social Security benefits.

Social Security Representatives

Let me begin this week’s blog post by saying I did not write it with the intention of disparaging the hard work and training most Social Security representatives receive, and the ceaseless work they do.  Rather I share the following story as a warning to all Social Security eligible recipients that the Social Security representatives working to help enroll them into the program are prohibited by the Social Security Administration (SSA) from providing financial planning and Social Security planning advice. They are, however, tasked with having a working knowledge of the myriad of Social Security rules and regulations and explaining those rules to you in a clear and concise manner. (Do not misconstrue an explanation of Social Security rules as Social Security planning advice) And when you do file for a benefit claim the SSA requires they ensure you receive the largest benefit you are entitled to receive at the time you apply for benefits!

Most Social Security agents are well trained, and take their jobs seriously, yet occasionally lapses can occur in their training. These lapses can lead to mistaken information being shared with the public they are meaning to serve.  Since most people visiting their local Social Security office know precious little about the rules and regulations governing Social Security, this erroneous information could lead to a loss of untold thousands in overlooked benefits.

File and Suspend

In my career I have experienced firsthand several instances where people were provided inaccurate information by Social Security representatives. The most recent happened just a few months ago. In this situation I encouraged a person who was working with me to employ a strategy called “File and Suspend”. My intent was to reserve for him the ability to request a large lump sum payment from Social Security between his Full Retirement Age and age 70 should his personal financial conditions change and necessitate such a payment. (You can read more on that strategy by reading our File and Suspend for Singles blogpost.)  When my client visited with his local Social Security office (You must make an appointment and meet face to face with a Social Security representative to employ “File and Suspend”.) the Social Security representative told him he would not be eligible to receive a large lump sum payment and that the strategy he described was not allowed. The client insisted he was allowed to employ the strategy and a lump sum check could be issued should he request one.

Learned Something New

Both the Social Security representative and the man were dogmatic in their opinion and a “deadlock” ensued. The representative told my client she would check on the strategy and contact him should the strategy be found to work as he described. The following day that same Social Security representative called my client at home and informed him that the strategy could in fact be done exactly as he described. She apologized for her mistake and assisted him over the phone in completing his “File and Suspend” strategy. She later told him “I learned something new today.”

It is important you don’t let Social Security representatives learn “something new” with the rules and regulations of Social Security and any associated claiming strategies at your expense. Make sure you know your rights and the rules governing any Social Security claiming strategy before you visit with your local Social Security representative.

For more information on this topic be sure to use the play button below to listen to our audio post.

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