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Expert Tips on Navigating Social Security with Tom Margenau
Expert Tips on Navigating Social Security with Tom Margenau
In this episode of Peaceful Life Radio, hosts David Lowry and Don Drew interview Tom Margenau, a former Social Security Administration employee with 32 years of experience and a nationally syndicated columnist. They discuss critical aspects of Social Security, including optimal signup ages, the myths about illegal immigrants receiving benefits, potential privatization, and survivor benefits. Tom Margenau also shares insights from his updated book 'Social Security: Simple and Smart' and addresses common questions about disability benefits, earnings penalty, and the significance of life expectancy in making informed Social Security decisions.
00:00 Introduction and Guest Welcome
01:26 Current Changes in Social Security
02:58 Privatization of Social Security
04:29 When to Start Taking Social Security Benefits
12:14 Disability vs. Retirement Benefits
17:07 Handling Social Security for Incapacitated Individuals
19:15 Filing Early to Grandfather into the System
20:16 Working While Receiving Social Security
22:03 Filing for Social Security Benefits
23:59 Addressing Social Security Myths
25:47 Tom's Books and Closing Remarks
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Well, people, they're always asking me, when should I sign up for Social Security? And I come back with another question. I say, when are you gonna die? Of course, since people don't know the answer to that question, they don't really know when is the best time to sign up for Social Security. I'll put it this way, I've heard from a lot of widows who told me, told my husband, insisted on waiting until age 70 to take his Social Security and he died at age 71. And gosh, I wish he would've taken benefits sooner.
David Lowry:Welcome everybody. These opening remarks were from Tom Margenau, today's guest on Peaceful Life Radio. I'm David Lowry and I'm glad you found your place on the internet for navigating the second half of life with purpose, wisdom, and grace, and like always a good buddy and co-host Don Drew is with us here today.
Don Drew:Hello, David and hello to all our folks out there listening to Peaceful Life Radio. We're glad to have you with us today. As David said, our guest is Tom Margenau, and Tom worked for the Social Security Administration for some 32 years, and since 1997, has been writing a nationally syndicated newspaper column about Social Security, so he knows a thing or two, doesn't he? Tom's got a wealth of information. He spent almost a half a century answering people's questions about Social Security and he is the author of a book called Social Security Simple and Smart. It's just been updated for 2025. So, Tom, welcome to Peaceful Life Radio.
Tom Morgenau:Hey, glad to be here with you guys.
David Lowry:Tom, if we had done this show about four months ago, it would've been a pretty standard show. I guess we should start with the big elephant in the room. What do we need to know about 2025 given all the changes happening in Washington dc?
Tom Morgenau:Well, the changes that are happening aren't really affecting 99% of your listeners. We're talking about all the stuff going on with President Trump and Elon Musk, but they're doing things like closing ancillary, not main, any kind of real Social Security offices. They're closing secondary little, the hearings offices that are rarely used. There's all kinds of talk about how they're finding problems with Social Security files. I've written columns recently about that. For example, the issue with supposedly dead people getting Social Security benefits wasn't true. Benefits are not being paid to deceased people. There's a Social Security number file that has nothing to do with the Social Security payment files. And the file that Trump and Musk were referencing is this Social Security number file that does have some deceased people's names on it, but that has nothing to do with Social Security payment files. Even though there's a lot of hullabaloo in Washington today about Social Security, frankly most of it shouldn't be affecting your listeners. They're gonna keep getting their Social Security checks. They're gonna be able to file for Social Security benefits. So, I don't think people should be too worried about what's going on with Social Security.
Don Drew:One of their big questions on people's minds these days and is part of the same line of thinking, do you think there's any kind of possibility that Social Security could be privatized?
Tom Morgenau:They've been talking for years about privatizing Social Security and it simply can't happen. First of all, lemme point out there's a 165 Social Security programs around the world. Every country on this planet has a Social Security system for its citizens. They're all run by the government because that's the only way to run such a huge social insurance program is to let the government run it. There's different forms of privatization. If we're talking about turning the Social Security over to a Wall Street bankers and let them make decisions about Social Security, that is never ever gonna happen. Although there is talk about taking some of social securities trust funds and investing some of those funds in the private. That's another form of quote unquote privatizing Social Security. But as far as privatizing Social Security, unless they take a small portion of the Social Security Trust fund and start investing that in the private markets, that's the only kind of quote unquote privatization I see ever happening. But again, it's never going to be turned over to private Wall Street bankers because a program that takes up one fourth of the entire budget of the United States, you don't turn that over to private interest to take care of. You need the government to run a program like that.
David Lowry:I think one of the questions people have as they get closer to Social Security and receiving benefits is, when should I do it? What factors should I consider? What are your thoughts on that?
Tom Morgenau:Well, they're always asking me, when should I sign up for Social Security? And I come back with another question. I say, when are you gonna die? Of course, since people don't know the answer to that question, they don't really know when is the best time to sign up for Social Security. You just have to look at all the factors in your life. You gotta look at your income situation. You gotta look at your marital situation. You gotta look at your life expectancy. You just take all these things into account and then make the best choice you can as far as when to start your benefits. I can tell you that nowadays most financial planners will tell you that you should probably wait until your full retirement age to start those benefits. Then you get your full 100% benefit rate. Just a few years ago though, same financial planners were telling people they should wait until 70 to start their Social Security. But what people have learned over the years is that if you wait until 70, most people just aren't living long enough to come out ahead of the game by delaying their benefits until such a late age. So, that's why the current wisdom seems to be take those benefits at your full retirement age. I will say this, if you are trying to maximize a potential benefit for your surviving spouse, and usually we're talking about a husband trying to maximize benefits for his wife once he dies and she becomes a widow. If he's trying to maximize those future widow's benefits, then it probably makes sense to wait until 70 to start your Social Security because at age 70 he gonna start getting 130 percent of his full benefit. And the wife will also get that 130% once he dies. So again, if you're trying to get your wife a maximum widow's benefit someday, wait until 70 to start those benefits.
David Lowry:Thank you very much for that, Tom. That's one of the big questions people have. Here's a funny thing that happened to me. I was working, enjoying my job. I realized I reached a full retirement age and it caught me out of the blue. I got a notice from the Social Security administration saying, Hey, you gotta sign up for this.
Tom Morgenau:Well, most people, as you're pushing Social Security age, should be thinking about retirement. Let me make this point. I started working for Social Security in the seventies and back then the vast majority of people were signing up for their benefits at 62. That was the earliest age you could get your benefits. You get a reduced benefit by taking it at 62. It's about a 70% benefit as opposed to the full 100% if you wait until the full retirement age. 50 years ago, everybody, or almost everybody was waiting till 62. Now many, many people are waiting till their full retirement age, many waiting until 70 to start their Social Security. We're living longer, we're living healthier. So there are people like pushing that age, but you don't even think of yourself as an old Social Security retiree. You think of yourself as active working person. And I could see where Social Security could sneak up on you and you suddenly decide, oh, I better do something.
David Lowry:I actually knew that Social Security was an option. But I just never thought about it much because I was still working and I had heard things like if I take Social Security, I would get a reduced benefit. I mistakenly thought that because I was working, even though I was at a age where I could take full benefits, I thought, oh, it's gonna decrease what I could get from the benefit, but that's not true, is it?
Tom Morgenau:There is no earnings penalty or anything that prevents somebody over their full retirement age from getting Social Security benefits. So somebody who's over their full retirement age, even though they're working. If they don't sign up for Social Security, you're starting to throw benefits away every month. Matter of fact, if you are over your full retirement age, and for most people nowadays, that's somewhere between 66 and 67 years old. If you're over your full retirement age, even if you're working, you could be making a million dollars a week and you can get a Social Security check. After age 66, you could have been getting a Social Security check. It's just something to think about that once you reach that age, you might wanna start grabbing those benefits. Otherwise, the money's just sitting there in the government coffers instead of in your bank account. I'll put it this way, I've heard from a lot of widows who told me, told my husband, insisted on waiting until age 70 to take his Social Security and he died at age 71. And gosh, I wish he would've taken benefits sooner. But then of course there's other people that lived to a hundred years old. You just have to make the best choice you can based on the information you have at the time you're pushing Social Security age.
David Lowry:My wife's grandma lived to be 102 years old. I think she probably got the best Social Security benefits of all of us.
Tom Morgenau:You do have to think about your family's genes. I've pointed out many times I took my Social Security at age 62. Now, why did I do that? Because I didn't inherit the best longevity genes. My dad died at the age of 47. I don't have a single uncle on my dad's side who lived past the age of 60. So, back when I was a younger senior, my early sixties, I figured, Hey, I got the wrong genes. I'm gonna grab my Social Security while I can at age 62. Of course here I'm now 75 years old and I beat the the gene pool system. Maybe I've come out on the short end of the Social Security stick because I took my benefits early. But who cares? My wife and I have been having fun. We've been enjoying our Social Security income. We've been traveling. Everything's good. I'm not worried about the fact that maybe I should have waited until a later age to start my Social Security. So, the message I'm always giving people is just make a decision and be happy with it, and live with it and don't worry about it. And once you make that decision, go on with your life.
David Lowry:It's not uncommon that some people are divorcing in their senior years. How do the Social Security rules work for divorced individuals, especially in their senior years?
Tom Morgenau:I'm constantly surprised by that. I got an email just the other day from a lady who divorced her husband after 50 years. And here's the Social Security rules about that. The law says if you've been married to somebody for 10 years, you are gonna get Social Security benefits off of that person's record. Let me clarify that a little bit. We're almost always talking about divorced women here. 95% of the benefits that are paid to divorcees are paid to women. And there's a reason for that. Men generally get higher Social Security benefits because men have worked longer, men's salaries and income has been generally higher than a woman's salary. A husband in a marital relationship almost always gets a higher benefit than his wife, which means the wife is the one who's potentially going to get a dependent spousal benefit on the husband's record. So, if a woman has been married to a man for 10 years or more, she's gonna get benefits on his record someday, unless she remarries. Now, if she remarries, then she can't get benefits from her first husband. If she's married a second time and is currently married to husband number two, then she can't get benefits from husband number one.
David Lowry:As people approach the age for drawing Social Security, it's not uncommon to face some medical issues. Should they take Social Security or apply for disability benefits? Are those separate programs or are they tied together?
Tom Morgenau:Yeah, they are separate programs. There are Social Security disability benefits, and there are Social Security retirement benefits. Let me point out, they're both. Social Security benefits. I frequently hear from people who are getting Social Security disability benefits, and then they say, when can I get real Social Security? I always say, you're getting real Social Security if you're getting a Social Security disability benefit. It just happens to be a disability benefit instead of a retirement benefit. But if you're pushing retirement age and you've got some medical issues, it certainly wouldn't hurt to file for disability benefits. But what you would do if you're under age 62, 62 is the earliest age you can get retirement benefits. If you're under age 62, then you should just file for disability benefits because you are not yet eligible for retirement benefits. In other words, if a 60-year-old guy has a heart attack. He should file for Social Security disability benefits because he's, again, not quite old enough yet for retirement benefits. But if a guy who is 62 years old has a heart attack, then he should file for both Social Security retirement benefits and Social Security disability benefits. And what they'll do is they'll start paying the retirement claim right away because it's relatively simple to process a retirement claim, but it's gonna take three months or so to process that disability claim. So, they'll start paying him retirement benefits and then if they approve his disability claim, they'll switch him from a retirement to disability benefits. And the reason that would switch is a disability benefit. A higher rate. Essentially, a disability benefit pays the same rate as a full retirement age benefit. So, the bottom line answer is if you're over 62, and have some kind of medical condition. You should file for both retirement benefits and disability benefits and see what happens.
David Lowry:Tom, when spouses are collecting Social Security at retirement age and one of them passes away, what happens to the benefit? Do they get two checks or what happens there?
Tom Morgenau:Let me do what is a normal situation again. Once again, 95% of benefits paid to a person in a death case are gonna to women. 95% of survivor benefits are widow's benefits. So, let's take a typical example. We got a guy who's getting$2,000 a month and his wife is getting$1,200 a month and she's getting that$1,200 in her own Social Security. He's getting a$2,000 Social Security check. If he dies, the widow will keep getting her$1,200 Social Security check, and then she'll get an extra$800 in widow's benefits to take her up to what her husband's level was at the time he died. So she'll get$1,200 in her own benefits. She'll get$800 in widow's benefits for a total of$2,000. So, that's the way it usually plays out. Now, let me point something else out here that people always ask when somebody dies. They always say, how come I got a return that last check he got? So, let's take an example where a guy dies on April 15th. And he's gonna get a Social Security benefit for April. What people need to understand is the Social Security benefits always come one month behind. So, the April check is paid in May. The May check is paid in June and so on. So, if a guy dies on April 15th, if a Social Security check shows up in May, which is his April Social Security check, that check has to go back to the government because the rules say you have to be alive every day of the month to get a Social Security benefit for that month. Because he died on April 15th, he's not due benefits for April. In other words, Social Security benefits aren't prorated. That's kind of the easiest way of putting that. A lot of people don't like that law, but there's actually a plus side to it in that if he has a widow, she is gonna get a widow's benefit for the entire month of April, even though she was a widow for only 15 days of that month. So, the lack of proration actually helps people getting survivor benefits, even though they might have to return the guy's last Social Security check. But again, she's gonna get widow's benefits for the whole month that he died. He could die on April 29th, and even though she was a widow for only one day of the month, she's gonna get a widow's benefit for that entire month of April.
Don Drew:David has a sister who recently had to go into a nursing home because of dementia, and she was at Social Security age. Could you walk us through the process of handling Social Security in such cases where David, in this case, had to advocate for her?
Tom Morgenau:A lot of people have power of attorney for a loved one, for an aunt, a mother, a grandma, or something like that. Well, power of attorney is kind of a useless designation for Social Security purposes because the Social Security law is based on privacy rules drilled into Social Security employees. I remember the very first day of my training class way back in 1974 or 1973. We spent that whole day talking about the privacy of Social Security that, you know, somebody's records are private and you can't share with anybody. So, if you have a sister who has problems. You can act on her behalf for Social Security purposes if she's mentally incompetent, I'll put it that way. If she is mentally incapable of handling her own Social Security affairs, then you can go to Social Security and say, I wanna be what they call a representative payee for my aunt. I wanna take care of her affairs. That means that her Social Security benefits would come in your name. You're essentially responsible for all her Social Security affairs. The way that works with when you're trying to help somebody out is if the person is mentally incapable of handling their affairs, you become their representative payee.
Don Drew:David, did you have very many problems becoming her representative?
David Lowry:I had to go through a court system to become her conservative or guardian, and a judge appointed me that. When I showed those papers to the Social Security office, they were very helpful and said, okay.
Tom Morgenau:If you did not have those papers, David, they would've asked you to get a notice from some kind of medical professional, like a doctor or somebody saying, you know, Susie Smith is not able to take care of her own financial affairs. So what's needed in these cases, is some kind of medical statement that says the person can't handle their own affairs.
Don Drew:One of the questions you've mentioned to being asked is whether someone should file early to grandfather themselves into the system? What's your advice on this?
Tom Morgenau:Usually they're asking me that for political reasons. In other words, they think, I think President Trump or Elon Musk or somebody is gonna mess around with Social Security and radically change the program. So, I wanna get on the bandwagon as soon as I can before they have a chance to do that. And I've always told people for years, for 50 years now, I've been telling people do not make Social Security decision based on politics because it's almost inevitable that there will be changes to Social Security down the road and those changes, whatever happens, they might raise the retirement age, there's a number of things that they could do, but they'll be phased in over a long period of time. They won't happen overnight. So, nobody's gonna pull the rug out from under you if you're pushing Social Security age now. Don't do it!
David Lowry:Many people worry about retiring or starting to draw Social Security at 62 instead at 65 because they think that if they work, it's gonna reduce their benefits. Is that true? What should they do?
Tom Morgenau:Now, if you are 62 years old and still working, then don't sign up for benefits because there are earnings penalty rules built into the law for people who are under their full retirement age. And those earnings penalty rules essentially say if you make over a certain limit, and that limit changes every year, it's currently about$23,000 or so. So, if you are working and making over$23,000, you are not due any Social Security benefits or you're due radically reduced Social Security. So don't sign up Social Security if you're under your full retirement age and still working, unless you just have some parttime job where you're making less than this$23,000 annual limit. Then, you could take your benefits at 62 even though you're working. But again, most people are working in a fulltime kind of capacity and they're making way more than$23,000. So those folks should definitely not file for benefits at 62 because they're not due any benefits. The law is gonna prevent them from collecting anything. Now, once they stop working or reach their full retirement age, then they can sign up for Social Security. But again, big message to folks is if you're 62 years old or under your full retirement age, and you're working, don't think about signing up for Social Security because you're just not eligible.
Don Drew:That's really good to know. So, a lot of our listeners might be 60, 61. They're approaching a Social Security age here pretty rapidly. What are some of the things that they really need to know and think about?
Tom Morgenau:Well, you can file online, which most people should do nowadays. It's much, much simpler to file for benefits at www.Social Security.Gov, www.socialsecurity.Gov. Signing up for benefits online is a piece of cake. You're gonna have to do one thing in most cases, and that is prove you're old enough for Social Security. So you're gonna have to show somebody a birth certificate. So, if you're pushing that Social Security age, one of the things you should do is gather the documents you need, and usually the only document you need is a birth certificate. And you need a certified copy of a birth certificate, not just a copy you might have laying in a desk drawer. It has to be a birth certificate with that seal on it from the agency that issues the birth certificate. If we're talking about people who just aren't comfortable working with computers and they'd rather do it in person, then they got call the Social Security Administration, and their full free number is 800 7 7 2 1 2 1 3. 7 7 2 1 2 1 3. So, you call the Social Security Administration and make an appointment to file that claim. The appointment can be either over the phone or at a Social Security office. Oh, and the other thing I should point out, do that about two or three months ahead of time. Social Security computers are set up to start taking claims three months before a person turns, whatever eligibility age we're talking about. In other words, don't do it six months ahead of time. If you called Social Security six months before you turn age 62 and you want benefits to start at 62, they're just gonna tell you, well have a nice day, but call us back in three months. So, three months before you want your benefits to start. Get a birth certificate and either go online or call the Social Security Administration to file that claim.
David Lowry:You addressed some myths in your book, breaking them into political and program myths, and I'd like to talk about a couple of them. One of them is the idea that illegal immigrants receive Social Security benefits and that Social Security hands out welfare benefits to people who never paid into the system. Is that true?
Tom Morgenau:There must be a current rumor going around because I probably got a half a dozen emails just today from people saying, I heard that illegal immigrants are getting Social Security. This has been a rumor that's been off and on for 30, 40 years. There are no illegal immigrants getting Social Security benefits. You have to be living in this country legally to get a Social Security check. Matter of fact, another current rumor says that the Biden administration was handing out Social Security numbers to people crossing the border illegally down in Texas, Arizona, and California. And of course, that's just ridiculous. Of course, they're not handing out Social Security cards to people crossing the border illegally. The bottom line is if you're living in this country illegally, there is no way you're gonna get a Social Security benefit. Simple as that. Now, there are many, many people living in this country legally who are not citizens. They move to this country legally. They're living in this country legally. They're working in this country legally, just like many Americans working in foreign countries. And those Americans working in foreign countries might be paying into that just as the people who have moved here legally and are living here legally, they're paying into our Social Security system. So those folks certainly can get a Social Security number and pay Social Security taxes and potentially collect Social Security benefits someday.
Don Drew:Thomas, as we're drawing to a close, can you tell us a little more about your book and the work you've been doing lately?
Tom Morgenau:Yeah, well, I got a couple books. But the main one is called Social Security, Simple and Smart. Social Security, Simple and Smart. You can get it at Amazon or Barnes and Noble online at either of those two sites. I don't think you'll find it in bookstores because it's too much of a specialty book to actually be on a shelf in a bookstore, but you can easily get it online at Amazon.com or Barnes and Noble dot com. The Simple and Smart book is really good book that takes you through all the different facets of Social Security. It's not a huge book at all. It's only like a hundred pages long. So, they should get that book if they want a good overview of Social Security. There's another book I wrote called Myths and Facts. 100 Myths and 100 Facts About Social Security. That book does just what it says. It clears up the many myths that are out there about the Social Security program. Or they can read my column. I write a weekly column about Social Security. It's called Social Security and You. And to find that column, they can go to www.creators.com. I write this weekly column about Social Security. By the way, your listeners send me a question to my email address and I don't mind giving it out. It's my name, Thomas dot Margenau, M-A-R-G-E-N-A-U, Thomas Margenau at comcast dot net. And I just love to answer questions for people about Social Security, so I wouldn't mind at all. If you listeners have a question, send it to my email address and I'll be happy to help them.
Don Drew:Thank you for being such an informed guest. We appreciate your tremendous knowledge on Social Security, and we wanna remind our listeners to get a copy of Tom's book, Social Security, simple and Smart. Thank you for being our guest today on Peaceful Life Radio.
Tom Morgenau:Yeah, you're welcome. I enjoyed it.
