Ask Liz Weston

Get smart with your money

Social Security

Q&A: Don’t fall for Social Security phone scams

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Dear Liz: I have just received a phone call advising me that my Social Security number “is about to be suspended” and that for help, I should call a certain number. Is this legitimate?

Answer: No. Your Social Security number can’t be locked or suspended or any of the other dire-sounding consequences these robo-callers threaten. If you did call the number, the scam artist on the other end would try to trick you into revealing personal information or convince you to wire money or buy gift cards, which they can quickly exchange (or “wash”) to erase their trails. People lost $10 million to these Social Security scams last year, according to the Federal Trade Commission.

Q&A: Working after retirement

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Dear Liz: My profession was one of the hardest hit by the Great Recession. I retired by default when I turned 62 in 2012. My Social Security payment was reduced because I started it early. I’ve found it necessary to return to the workforce part time to move beyond just surviving and have some discretionary funds. What does my employment mean for future Social Security payments?

Answer: You’re past your “full retirement age” of 66, so you no longer face the earnings test that can reduce your Social Security benefit by $1 for every $2 you earn over a certain limit ($17,640 in 2019).

Sometimes returning to work — or continuing to work after you start receiving Social Security — can increase your benefit if you had some low- or no-wage years in your work history. Social Security uses your 35 highest-earning years to calculate your checks. The amounts are adjusted to reflect changes in average wages, which is somewhat similar to an inflation adjustment. If you should earn more this year than you did in one of those previous years, your current earnings would replace that year’s earnings in the calculation and could increase your check.

Another way to boost your benefit if you’ve reached full retirement age but are not yet 70 is to suspend it. That means going without checks for a while, but your benefit earns delayed retirement credits that can increase the amount by 2/3 of 1% each month, or 8% a year. It may not be practical for you to do this: You probably need the money, and you could be too close to 70 to get much benefit. But perhaps that’s not the case for someone else reading this.

Thursday’s need-to-know money news

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Today’s top story: What will long-term care cost you? Also in the news: Social Security myths, the best cities for first-time home buyers, and how to pay less to your credit card company.

What Will Long-Term Care Cost You?
Almost everyone will need it after 65.

Don’t Believe These Social Security Myths
Checking the facts.

These are the best cities for first-time home buyers
7 spots to look at.

Here’s how to pay less to your credit card company
Just pick up the phone.

Don’t believe these Social Security myths

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Researchers tell us that most people would be better off waiting to claim Social Security benefits. Yet most people file early.

More than half apply for Social Security before they reach full retirement age, which is currently 66 and rising to 67 for people born in 1960 and later. More than 30% apply as soon as they can — at age 62. Only about one in 25 applicants waits until age 70, when monthly benefits max out.

Some people have little choice, of course. They may have no savings and no job. Others have better options than applying early, but don’t realize it.

In my latest for the Associated Press, the myths surrounding Social Security.

What will long-term care cost you?

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Many people are frightened of long-term care costs — for good reason.

Most people over 65 eventually will need help with daily living tasks, such as bathing, eating or dressing. Men will need assistance for an average of 2.2 years, while women will need it for 3.7 years, according to the U.S. Department of Health and Human Services’ Administration on Aging.

In my latest for the Associated Press, the high cost of long-term care and why planning ahead is essential.

Q&A: Finding a financial planner

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Dear Liz: Your column on delaying Social Security suggests using a certified financial planner on an hourly basis to review one’s retirement plans. I have struggled to find one who charges this way. They almost all want to control your money for a fee. The one I found after some effort charges $500 to $600 an hour. Please make some recommendations. I don’t mind if the CFP is not local. I just want someone who is certified, reputable, with a reasonable hourly fee.

Answer: There are a growing number of options for people who want “advice only” financial planning from a fee-only, fiduciary advisor:

XY Planning Network is a network of planners who offer flat monthly fees in addition to any other options, including hourly or assets-under-management fees. Monthly fees are typically $100 to $200, with some planners requiring an initial or setup fee of $1,000 to $2,000.

Garrett Planning Network represents planners willing to charge by the hour, although many also manage assets for a fee. Members are either certified financial planners, on track to get the designation or certified public accountants who have the personal financial specialist credential, which is similar to the CFP. Hourly fees typically range from $150 to $300, with a consultation on one topic such as Social Security-claiming strategies or a portfolio typically taking two or three hours. A comprehensive financial plan may require 20 hours or more.

Advice-Only Financial is a service started by financial blogger Harry Sit to connect people with fee-only advisors who just charge for advice and don’t accept asset management fees. Sit charges $200 to help people find fiduciary CFPs who are either local or willing to work remotely. The planners typically charge $100 to $400 an hour.

Another option for those who don’t have complex needs would be an accredited financial counselor or financial fitness coach. Those in private practice typically charge $100 to $150 an hour, although many work on a sliding scale, said Rebecca Wiggins, executive director of the Assn. for Financial Counseling & Planning Education.