Retirees who expected to use loopholes to get extra money from Social Security will need to find another strategy, as Congress has eliminated the loopholes that allowed many to collect tens of thousands of dollars.
Under the old rules, married couples could file for benefits but immediately suspend the benefits, allowing them to collect benefits on their spouses' records, while the spouses waited longer to collect their own benefits, reports The New York Times.
Another strategy being eliminated allowed married couples, once they reached their full retirement age, which is now 66 to file a "restricted application," which allowed them to collect only a spousal benefit while allowing their own benefits to climb for a few more years.
But one guideline has remained the same: healthy people should wait as long as they can, even though they can start collecting benefits at age 62. If they can wait until they're 70 years old, retirees earn a check that is 76 percent higher, but fewer people wait that long.
And with the new rules, retirees only get the larger benefit, the spousal or their own, but not both, and can lose anywhere from $10,000 to more than $60,000 because the loophole will be gone.
The changes were made because the Social Security Administration and Congress determined that the loopholes benefited wealthy recipients, but critics say the strategies also helped low-to-middle income retirees as well, and will harm retirees that needed to use the money.
However, Alicia Munnell, director for the Center for Retirement Research at Boston College, told the New York Times that the tactics were an "unfair system" because most people did not know how to use them.
They did, though, allow retirees to receive at least some money while they delayed taking Social Security.
“It takes longer for a delayed strategy to be superior to one where you claim early,” said William Meyer, founder of Social Security Solutions
, which helps users maximize their benefits. Further, he said that with the new rules, it would help some users to claim at their full retirement ages instead of waiting until they turn 70.
"Of course, if you are healthy and could possibly live a long life, the delay strategy is best since it hedges longevity risk," he told The Times.
However, it's not always obvious which strategy is best, said Meyer, even though the new rules simplify matters.
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