Navigating Social Security
* Test your knowledge of benefits.
Here’s a quick quiz for anyone who thinks they know about Social Security:
1. What’s the earliest age at which you can qualify for benefits? (a) 65 (b) 62 (c) 55 (d) at birth.
2. At what age can you can collect full retirement benefits? (a) 65 (b) 67 (c) 65 and three months (d) 66 (e) depends on when you were born.
3. Social Security can provide benefits to (a) dependent children (b) surviving spouses (c) dependent parents (d) all of the above.
Answers: d, e, d.
Surprised? You’re not alone. Social Security is a highly complicated system that evolved from a simple safety net for retirees into an insurance program for the aged, disabled and survivors--be they 8 or 88.
Many people don’t understand the rules, when and how they can apply for benefits or how much their benefits might be.
For those who would like to know more about the system, how it works and who does and doesn’t qualify for benefits, there’s a free book: “Social Security: Understanding the Benefits.”
To get a copy, write to the Consumer Information Center, Dept. 517C, Pueblo, CO 81009. When you order the book, you’ll also get a form, called a Request for Earnings and Benefit Estimate Statement, which you can fill out and send in. The Social Security Administration will then shoot back a detailed statement showing the monthly amount of benefits you should expect at retirement or disability, based on the wages and work history recorded in your file.
Anyone who is considering retirement in the next 10 to 20 years ought to get this benefit estimate. It’s a pivotal step in determining how much you’ll need to save to have adequate income during retirement.
* Get free college planning information.
High school seniors--and parents--should know that now is the time to start getting your act together for college. Why? Many types of financial aid are awarded on a first-come, first-served basis. Those who apply early have the best chance of getting all the financial help they need.
Many experts suggest you get a form, called the Free Application for Federal Student Aid, in November (usually about as early as it’s available). The forms should be mailed in early January. The two-month lead time is to give you enough time to find the financial records necessary to fill it out. (It’s a doozy of a form.)
Students who want to attend pricey private universities may also have to fill out a second financial aid form, which would be provided by the target college or university. Those who already know where they’ll go to college should talk to the school’s financial aid office to get more information on how to apply for school-based aid. Some schools and private scholarships accept applications early. The Nicolas Green Scholarship Fund, a $2,500 grant for gifted students who want to study overseas, started accepting applications this month, for example.
You can get general federal student aid information--including the FAFSA form--by calling (800) 4-FED-AID.
In addition, American Express Financial Advisors has put out a nice little booklet that explains the basics of what college costs and where the money might come from. The booklet is available free to those who call (800) 986-9598.
* Read long-term care “shoppers guide.”
If your company has just started offering long-term care policies as a discretionary employee benefit and you don’t know whether you should sign up, you should know about a terrific little booklet put out by the National Assn. of Insurance Commissioners.
“A Shopper’s Guide to Long-term Care Insurance” explains what long-term care is, when long-term care expenses are covered by Medicare and how to evaluate whether long-term care insurance is right for you.
It also explains the differences between the types of policies and specific items you should consider when shopping. It also lists where you can get help--in every state--if you need information on issues affecting insurance and aging. Finally, it includes handy work sheets to help you compare the costs of different long-term care policies.
Companies selling long-term care insurance should be able to give you a copy of this booklet for free. It’s also available at no cost through most state insurance departments.
In California, you can get a copy by calling (800) 927-HELP.
Consumer Checklist is a weekly feature that covers a range of pocketbook issues of interest to Californians. To contribute information about new legislation, products, services or surveys, write to Kathy M. Kristof, Business Section, Los Angeles Times, Times Mirror Square, Los Angeles, CA 90053, or e-mail kathy.kristof@latimes.com
