“As advisors, we have to rely on the Social Security Administration for interpretation of these convoluted rules,” Frank says.
The other change that was made phased out the restricted application. Still, using a traditional situation of a high-earner husband and low-earner wife, the wife could file a restricted claim to her benefits and not receive them while she receives benefits through her husband’s Social Security. Her benefits would continue to grow and she could later switch. Now, this technique is only available to those who turned 62 by the end of last year.
“Women in general are already at the short end of the benefits scale and now they are being hurt even more by having this option of a restricted application taken away,” she adds. “This all has to be part of the divorce negotiations, but both parties need to know what they are entitled to.”
Frank says those wanting to claim benefits are not always given accurate information by financial advisors, legal consultants or even the Social Security Administration.
“I have sent more than one client back to the Social Security office to ask for a second explanation if something did not conform to what I thought the rules were and I would tell any advisor to do that, or to ask for themselves.
“These clients have one chance to get their benefits right and you want to do everything in your power to make sure they make the right decisions,” Frank says.