Do You Know Your Flood Risk?

Almost everyone has a risk of being flooded, regardless of where they live. According to the U.S. Federal Emergency Management Agency, more than 20 percent of all flood insurance claims come from areas outside of high-risk flood zones. That still means the vast majority come from high-risk areas. How can a property owner find out what his flood risk is?

FEMA considers a property to be at high risk of flood if there is at least a one-in-four chance of flooding during the life of a 30-year mortgage. Geographic areas with this risk are known as special flood hazard areas (SFHA). Federal regulations require federally regulated or insured mortgage lenders to confirm that mortgaged properties in these areas carry flood insurance.

The traditional way to determine a property’s flood risk is to locate it on a flood insurance rate map (FIRM). FEMA publishes these maps based on geographic survey data. They are the official depictions of flood hazards in a locality. FIRMs are freely available for review on Flood Map Service Center on FEMA’s web site. A property owner can view his flood risk by entering the address in the search field.

Flood maps assign each area in a community to labeled flood zones. Areas with low-to-moderate risks of flooding are assigned to zones with labels beginning with the letters B, C, X or a shaded X. SFHAs are designated with the letters A or V. These areas are shaded on the maps for easy identification.

Property owners can also search for their flood risks at FEMA’s flood insurance consumer web site, By entering the address in the fields on the home page, they can quickly learn whether they face a low-to-moderate or high risk. The site offers other valuable tools, such as an estimator that can calculate how much damage a given amount of water (two inches, four inches, etc.) would cause in homes of various sizes. For example, six inches of water in a 2,000 square foot home would cause $39,150 in damage.

FEMA also offers a suite of flood risk products that go beyond the information provided in a FIRM. They include Flood Risk Maps, which show the overall picture of flood risk for a given area; Flood Risk Reports, which show community-specific flood risk information; and the Flood Risk Database, which stores all flood risk data for an area. These products are helpful for community planners, but individual property owners can also use them to get a clear idea of their flood risks.

Elevation certificates may also be on file with local governments for certain properties. This document shows the elevation of the lowest floor of a building (including the basement) compared to the base flood elevation for the area. It demonstrates community compliance with floodplain management laws and is used to set appropriate flood insurance premiums.

A flood can be every bit as catastrophic as a fire. It is worthwhile for property owners to learn their flood risk and take steps to reduce it.

Most Americans Lack Disability Insurance Or Means To Financially Survive A Long-Term Disability

According to a Cigna survey, about 50 percent of workers in the United States liked their jobs, and 10 percent would continue working the same job even if they had enough money to never work again. However, the survey also found that most workers did not have solid plans for sustaining income if they suffered a severe injury or disability. In 2014, more than 1.5 million American workers suffered illnesses or injuries that resulted in long-term work absences.

Of the workers who reported taking steps to financially protect themselves, these are some examples of their positive actions:

  • Adopting a healthy lifestyle to prevent chronic illnesses
  • Saving money for unexpected health issues
  • Taking steps to avoid injuries at work

Only 10 percent of survey responders had disability insurance or a similar plan such as critical illness insurance. The Bureau of Labor Statistics reported that less than 40 percent of those who work in the private industry have short-term disability insurance, and even fewer carry long-term disability coverage.

In the Cigna study, almost 45 percent of participants reported worrying about how they would pay medical costs that their plans would not cover if they were seriously injured. Government disability benefits only provide a fraction of a worker’s previous income. However, supplemental personal policies can help fill those gaps. Many disability plans also include services designed to help people stay at work even if they cannot return to the exact same position. If they are unable to return to work at all, most disability plans offer assistance in obtaining Social Security benefits as well.

Employers can help their workers prevent these struggles by offering disability insurance and other beneficial policies such as accidental injury, critical illness and hospital indemnity. Also, employers must educate their workers about the importance of supplemental coverage. Many survey respondents mistakenly believed that the Family and Medical Leave Act’s provisions would suffice for a long-term absence after an injury. However, FML provisions only cover periods of absence and do not offer any financial assistance. To learn more about employer-sponsored disability coverage and other supplemental options, discuss concerns with an agent.

Take Steps To Protect Your Information From Cyber Criminals

A woman learns about a possible security hole in her internet browser. She does a search to find out more about it and lands on a site that explains the problem and offers a free download to fix it. Wary of downloading a file from an unfamiliar site, she leaves it and goes to the browser publisher’s site. She finds the patch, downloads and installs it, and believes she’s protected.

Unfortunately, software running on the first site detected that her browser had the vulnerability. It used the vulnerability to upload and install a program that will record and transmit back every keystroke she types. As she does some online banking, the program captures her login information, account number, answers to security questions, and other private information. Weeks later, she finds that her bank account is cleaned out.

Her experience is not unique. In 2015, there were more than two data breaches every day, exposing more than 150 million records. In 2014, cyber criminals stole $16 billion from 12.7 million U.S. consumers. More than one-third of cyber crime in 2015 involved computer hacking. With so many successful data thefts occurring, everyone must assume that the criminals are coming for their information.

There are things individuals can do to reduce their chances of becoming victims:

  • Set tough privacy settings on all computerized devices – laptops, desktops, phones and tablets. Use complicated passwords. It is harder for a hacker to figure out a password like “77g0HH**6” than it is to figure out “birthday”. Change your password periodically.
  • Do not respond to unsolicited requests for your information via email or web sites.
  • Do not download files from web sites unless you are familiar with and trust them.
  • Before sharing personal information on social media, carefully consider whether the benefit is worth the risk.
  • Learn about the fraud protections offered by banks and credit card companies. Find out what the terms and conditions are. Keep the phone numbers for reporting fraudulent activity handy.
  • Some states have laws that permit consumers to place security freezes on their credit information at no cost. Find out if yours is one of them.
  • Before buying hot new technologies in a car or for home appliances, consider the data risks. Any computerized device can be hacked. Buyers should consider whether the convenience offered by these technologies outweighs the risks.
  • Find out the insurance options available. Some insurers bundle identity fraud coverage with homeowners and auto policies. Talk to an agent about what the insurance does and does not cover.
  • Periodically check credit reports. The three major credit reporting agencies – Experian, TransUnion and Equifax – provide one free credit report per year to consumers. These reports should be monitored for unfamiliar activity.

Internet technology has made life better and more convenient in many ways, but it has also opened new pathways for criminals. Consumers cannot assume that they are safe. Taking precautions may not completely eliminate the chance of being hacked, but they will make it much less likely.

Understanding Reverse Mortgages and Their Purposes

For people who are in their 60s, a reverse mortgage is an option for acquiring more money to pay bills or other expenses. Since a reverse mortgage uses the equity in the home, it also reduces a person’s assets. This means less asset value for heirs if they would otherwise inherit the home.

How Reverse Mortgages Work With a traditional mortgage, a person pays a lender every month and eventually owns the home. A reverse mortgage is a loan where the lender pays the homeowner. The value of the loan is tied up in the home’s equity, which is converted into payments for the homeowner. Think of it as an advance on the equity. Payments are typically not taxed, and the money does not have to be paid back as long as the homeowner remains in the home. However, the balance is due when the homeowner moves out, dies or sells the home. When that happens, the homeowner or the estate must repay the loan. For this reason, a reverse mortgage can be a burden on surviving family members if it is not planned correctly. If there is a life insurance policy, a policyholder should update the amount to include enough for survivors to pay off the balance.

Reverse mortgages may be single-purpose, proprietary or insured by the government. When they are insured by the government, they are considered home equity conversion mortgages. For all types of reverse mortgages, the homeowner keeps the title to the home. An advance is received every month instead of making a mortgage payment. In some cases, a spouse who is not on the loan may still remain in the house if the borrower dies. This is usually true of a HECM. However, the spouse will not receive any monthly payments after the borrower dies.

These are some important considerations for reverse mortgages:

There are additional fees. Plan on an origination fee, closing costs and servicing fees. Mortgage insurance may also be required for HECMs.

The amount owed grows. Since interest is added to each equity payment, the amount due grows over time.

Interest is not deductible each year. Interest cannot be deducted on a tax return until the loan is being paid off.

Interest rates may change. Reverse mortgage loans have variable rates, which fluctuate considerably. HECMs may have fixed rates with a lump-sum payment at closing.

Homeowners still cover their own costs. Since the homeowner retains the title, he or she is still responsible for utilities, maintenance, insurance and other costs. Also, the lender can stop loan payments if the homeowner does not pay for insurance or property taxes.

Types Of Reverse Mortgages

When considering a reverse mortgage, it is important to understand the three options. Each one has its own benefits.

Single-purpose mortgages are less expensive. Local and state government agencies usually offer these loans, and some non-profit organizations may offer them. The lender specifies one purpose for the loan. For example, the lender may say that the loan funds are only for conducting major home improvements if the home is a historic one. To qualify, homeowners usually only need low or moderate income.

Proprietary mortgages are backed by their originators. If a lender develops this type of loan, that financial institution or party will back it. This is a good option for people who own high-value homes and want a larger advance. Those who have a small mortgage balance and a high appraisal value will receive the biggest advance.

Home equity conversion mortgages are for any purpose. Homeowners can use these loans for anything from paying off personal bills to making improvements on the home. HECMs are backed by the U.S. Department of Housing and Urban Development. These loans tend to be more expensive and come with higher upfront costs. There are specific criteria for qualification, and potential borrowers must meet with appointed personnel before applying.

With careful planning, a reverse mortgage can be a benefit for a senior citizen who needs money and does not have a better source for it. To learn more about this option and planning for it with insurance, discuss concerns with an agent.

Get Insurance for your Kids in College

Back in the day kids showed up to their college dorms with not much more than the clothes on their backs and a couple of suitcases, maybe a small stereo. A generation ago, laptops were nearly unheard of in college dorms. Obviously, those days are over.

Today college students rely on a small arsenal of laptops, tablets, smart phones and other valuable electronic devices – all critical for socializing, as well as completing homework and studying. Access to a laptop isn’t a luxury for students anymore – it’s a must.

Homeowners vs. Renter’s Insurance

Fortunately, for parents with a homeowner’s insurance policy, most full-time students are covered against theft and other common hazards under that policy if their primary residence is still the parent’s home, even if they are living far from home in a college dormitory.

There are exceptions and exclusions, of course. Insurers usually set an upper age limit of 24 on students they are willing to cover under a parental policy. Carriers will also typically insure 10 percent of the value of the parents’ insured belongings and personal possessions and effects.  Because of this, you may not want to rely entirely on your homeowner’s insurance policy to protect your college age child.

Furthermore, homeowner’s insurance is not well suited to covering relatively small losses such as a typical dorm theft. Homeowner’s insurance deductibles tend to be $500 to $1,000 or higher- too high to provide the student with meaningful protection against a stolen tablet or smartphone, for example and repeated small claims over a short period of time could cause your homeowner’s insurance company to increase your rates or can even cancel your policy. Most experts suggest preserving the homeowner’s policy for bigger events, such as a fire, which could cause your child to lose all their possessions.

For a college student living in a dorm, a renter’s policy may be more effective. Renter’s policies are extremely inexpensive in most cases – average costs are around $200 to $300 per year, for about $15,000 in personal possessions coverage, and have lower deductibles that are more appropriate for college students. Additional insurance is easily purchased if necessary.

Auto Insurance

If you own the car your student is driving, then you are still responsible for it, even when it’s being driven by a full-time student. If the car is kept in a new location, such as on or near campus, rather than at the parents’ residence, you must notify the insurance carrier. Be sure to add your child to the list of authorized drivers and remind them that it’s not a good idea to allow their friends to drive the car. Talk to your college student about using ride sharing services or taxis when going out drinking.

Sending your kid to school without a car may be the best choice. The recent rise of ride sharing services like Uber and Lyft is making it easier and more economical for students to function without a car.

As always, speak with your college student about the risks of drinking and driving, texting while driving, driving while distracted, etc.

Umbrella Liability Insurance

You may wish to consider adding umbrella liability coverage to protect yourself and your college-age child. Umbrella coverage kicks in in case there is a claim against you that exceeds the coverage limits of your auto and homeowner’s insurance policies. For example, imagine your college-age child causes a car accident that results in $500,000 in damages to another party. Your car insurance policy only covers $200,000 in liability. In that case, your umbrella insurance policy will cover the difference, up to the limits of the policy.

Health Insurance

Under the Affordable Care Act, parents are generally entitled to keep full-time students on their own policies until the age of 26. Keeping your college age child on your health insurance plan, whether individually-owned or employer-sponsored, is usually preferable to enrolling them in the college health plan, because coverage is typically more limited with these plans. For example, many of college health plans limit catastrophic coverage to $50,000 per accident or illness, and exclude injuries that are incurred as a result of alcohol or drug abuse.

If your health plan is a health maintenance organization (HMO) or preferred provider organization (PPO), take a look at the available network of care providers. These models of care rely on narrower networks of approved care providers to control costs. They may not have any approved in-network providers near the college campus at all.

Top Concerns of Retirees And Those Nearing Retirement

According to a study conducted by the Society of Actuaries, paying for long-term care and inflation were the two main concerns of individuals who were nearing retirement or those who had recently retired. The study’s purpose was to identify financial decisions and resource management habits for pre-retirees and retirees. In the survey, pre-retirees were identified as people who had not yet retired but were at least 45 years of age. They were concerned about their ability to pay for health services in the future. 

Working And Delaying Retirement


Although retirees and pre-retirees voiced the same concerns, researchers said that there are differences between what people thought they would do after retirement to manage their funds and what they actually did. About 70 percent of pre-retirees reported expecting to work after retiring. More than 45 percent said that they would delay retirement. In contrast, only 30 percent of the retired respondents actually worked after retiring, and only about 10 percent attempted to postpone retiring.

Life Expectancy

As they did in the previous year’s SOA survey, pre-retirees continued to miscalculate their life expectancy. Most of the respondents in the current survey predicted living until age 85. However, more than 50 percent of respondents reported having one or more family members who lived beyond age 90. The average predicted life expectancy by respondents was about 10 years shorter than their longest-living family member’s lifespan.

To counteract the risk of outliving retirement savings, about 30 percent of respondents reported buying a guaranteed life insurance policy. This number included more than 20 percent of the retired participants. Researchers said that this still shows a major problem with most people planning on a short-term basis instead of a long-term basis.

Additional Survey Findings

The most common financial shock that retirees cited was expensive home repairs. About 25 percent required costly dental work, and another 20 percent mentioned prescription prices or out-of-pocket medical costs.

When researchers asked pre-retirees when they plan to retire, more than 15 percent said they plan to retire within the next 10 years, about 20 percent said within 10 to 15 years, and almost 40 percent were undecided.

For pre-retirees, the main form of debt is mortgages. More than 50 percent of pre-retirees are still paying a mortgage, and about the same percentage reported having considerable credit card debt. Another 40 percent of this group mentioned that they have car loans to pay and approximately 30 percent have $30,000 of debt aside from their mortgage balance. In comparison, more than 50 percent of retirees had less than $10,000 of total debt.

Adequately planning for retirement involves setting up savings vehicles and overestimating life expectancy instead of making a low estimate. Life insurance, retirement plans and investments are all important topics to research. To learn more about retirement options and how to build a solid retirement plan, discuss your concerns with an agent.


What To Do When A Windstorm Threatens Your Business

Over the past several years, windstorms have damaged countless businesses in the United States. Although business interruption and property damage are both covered issues, a damaged reputation and market share losses can still be financially devastating. Problems are worsening for business owners everywhere as windstorms continue to increase in frequency and severity and wiith adequate preparation, business owners can prevent some of the biggest losses. Use this checklist as a guide.

Develop an emergency plan with comprehensive provisions. Assign roles to different people within the organization, and train them regarding their responsibilities every year. The plan must provide for assembling supplies in a safe place. Make a list of vendors related to recovery and salvage. Also, make a business continuity plan as part of this step, and revise it as necessary each year.

Designate a storm monitor. Choose someone who is capable of monitoring and reporting the status of the storm. This person should be able to communicate with other workers or departments while allowing time to coordinate and implement emergency procedures.

Keep the roof in good repair. Inspect the roof regularly for loose coverings, flashing, gutters and downspouts. Repair them immediately. If drains are clogged with leaves and debris, clean them. Secure any stacks, signs and ventilators on the roof, and anchor any large equipment.

Store loose items in advance. If there is a threat of a windstorm, put away any chairs, equipment or decorations that could become flying hazards. Also, be sure to cover, secure or store any flammable containers properly. Do not store them in the main facility. Also, keep trees and shrubs trimmed to avoid falling or swinging branches.

Protect doors and windows. Any windows and exterior doors should have pre-fitted storm shutters. If these are not available, use plywood to secure them. Inspect windows and doors regularly for loose hardware. If there are any roll-up doors with metal brackets, install steel bars on the inside of them.

Fill generator tanks. Also, fill fire pump tanks and gas tanks on company vehicles. To prevent wind damage to above-ground water tanks, fill them in advance. Keep any basins or drains free of debris.

Protect valuables in the building. Keep computers away from windows or glass doors. If there are expensive inventory items, be sure that they are in a safe place in a warehouse and are kept away from doors or windows. If rain is expected with the windstorm, put protective covers on expensive items.

Prepare for flooding. Those who are located in flood zones should relocate important equipment and records to places that are safe from flood waters. For sewer systems, install back-flow prevention parts. If necessary, place sandbags along vulnerable points around the business. When there is impending danger, turn off the power to the building. However, power for fire pumps should be left on.

Be prepared to terminate operations. Shut off everything that is flammable or combustible. Enforce rules for no smoking, welding or cutting.

Follow safety procedures during a storm. However, keep watch over the property as much as possible without violating safety rules. When the windstorm is over, contact key personnel and the insurance company to assess damages. Perform any temporary repairs as necessary to prevent further damage, and save all receipts. Call salvage contacts to pick up damaged or ruined equipment if necessary. When it is safe to do so, start cleaning up the property by trimming broken tree branches, cleaning out the gutters and taking steps to prevent mold growth. To learn more, please discuss your concerns with an agent.

Prevent Depletion of your Retirement Funds due to Healthcare Costs

Six out of every ten Americans worry they will become a financial burden on their families as they get older. And of affluent pre-retirees, nearly seven out of ten of them fear that even with Medicare, high health care costs could put their retirement plans at risk. Indeed, 57 percent of Americans say that they are “terrified.”

More than half of Americans say that it’s important for their financial professional to speak with them about protecting themselves and their families against the risk of unexpected health care costs – including major medical, long-term care, nursing home and hospice care – in their retirement years. 38 percent of Americans believe that healthcare costs will be their biggest expenditure in retirement.

55 percent of Americans fear their healthcare costs will consume all the money they planned to leave for their children, and 45 percent of adults with children say they would give all their money to their children so they can qualify for long-term care costs under Medicaid.

Nevertheless, only 10 percent of Americans report that they have even had a conversation about it with their financial advisors.

That’s according to the recently published Fourth Annual Health Care and Long-Term Care Study, from the Nationwide Retirement Institute.

You Can’t Cheat.

Sometimes, people expecting to need nursing home care in the near future, or who are already in nursing home care, will try to game the system by transferring assets to family members. The intent is to bring their own assets down under their own state qualification criteria so they can receive Medicaid benefits.

But there’s a problem with that: The Medicaid program was designed to provide basic care for the truly impoverished and indigent. And so with the Deficit Reduction Act, Congress elected to create a ‘lookback’ period of five years prior to the date you apply for Medicaid. Any transfers you make within five years prior to applying are effectively disallowed, and those assets considered available to spend down before you can qualify for Medicaid benefits.

So what can you do?  

If healthcare and long-term care costs in retirement are a concern for you, then you may consider protecting yourself with long-term care insurance. This insurance typically pays up to a few hundred dollars per day in benefits should you become unable to care for yourself and need nursing home or other support assistance.

Specifics vary widely by carrier, and most policies come with options like inflation protection, shared care (allowing a married or otherwise connected couple to share a combined pool of benefits, if necessary), return of premiums on unused coverage, and higher or lower daily benefit rates.

This insurance coverage effectively protects not just your retirement assets, but also your income as well: The average cost of a semi-private room in a skilled nursing care facility is now more than $80,000 per year – more than enough to devour an entire pension.

Certain tax-qualified long-term care policies also provide an important benefit: They help shelter your assets from seizure by state Medicaid authorities to reimburse taxpayers for the costs of care. Here’s how it works: If you purchase up to $200,000 in long-term care benefits from an insurance carrier, using a qualifying policy, the state will exempt the first $200,000 in your estate from seizure to pay themselves back for benefits paid on your behalf.

Long-term care planning is a vital component of your financial plan – especially if you have assets to protect, or if you want to pass a financial legacy on to your children instead of on to the state coffers.

To start the ball rolling, contact your insurance professional today.

The Most Common And The Most Costly Homeowners Insurance Claims

Recent research information from the Travelers Companies, Inc. showed the most expensive and the most common homeowners insurance claims. Their data was based on home insurance claims filed in the United States between 2009 and 2015. During this time period, they found that weather-related damages were the most common causes of claims. Freezing pipes, broken pipes, wind, flashing leaks, roof leaks and ice dams were some of the biggest problems related to weather.

The Most Common Causes Of Home Insurance Claims
Exterior wind damage comprised 25 percent of all losses, and water damages that were not related to weather took second place at 19 percent. These included appliance problems, toilet flooding, burst pipes and similar issues. Hail was the cause of 15 percent of claims, and weather-related damages made up 11 percent of claims. These damages included those resulting from snow, ice and rain. Six percent of home insurance claims were filed because of theft.

Although many things could possibly go wrong in a home, most incidents are not predictable. Experts said that if homeowners focus on the common risks, they can perform regular maintenance and take the right steps to prevent these common damages. 

The Most Expensive Home Insurance Claim Causes
Although weather-related claims were the most common type, claims from fires were the costliest. They accounted for about 25 percent of all claim costs. In most instances, the fires were caused by the misuse or failure of machines and appliances. Electrical fires, wiring issues, faulty outlets and cooking mishaps were also common causes of fires. Hail, wind and leaks from appliances or plumbing parts ranked below fires for being the most expensive home insurance claim causes.

Water damage was also a costly type of claim. For water damage, there are two types of problems – internal causes and external causes. Internal causes are plumbing issues, burst pipes and similar issues. External causes are snow, ice or rain. The majority of water damage claims happened because of internal issues rather than external ones in this research project.

How Claims Differ
Claims and their causes differ by region. Wind was the leading cause of claims in the Northeast. In this area, the weight of snow and ice during the winter also led to a large amount of claims. For the costliest type of claim in the Northeast, fires took first place.

In the South, the most common claim cause was wind. Hail ranked the highest in this area for being the costliest type of claim. Hail was the leading cause of claims in the Midwest and in the West. It also caused the most expensive damages in those areas. As a secondary problem from the hail, many homeowners in the Midwest experienced problems with their sewers or sump pumps backing up.

Preventing Common And Costly Claims
There are several ways for homeowners to keep themselves and their families safer. Simple tasks such as cleaning leaves from the gutters in the fall and keeping a trickle of water running when the temperatures drop in the winter can prevent costly water damage. Fire safety plans and extinguishers are also a must for every home. There are plenty of other tips. Every family’s risks vary in likelihood depending on several factors. It is important to have a personalized assessment of risks before setting up a plan to prevent serious claims. To learn more about protecting a home from claims and what steps to take based on individual risks, discuss concerns with an agent.


New Social Security Rules Change Filing Strategy for Couples

A 2015 law made a number of changes to Social Security benefit maximization strategies. Section 831 of The Bipartisan Budget Act of 2015 amended the Social Security Act to close two loopholes that primarily affect married couples: The timing of multiple benefits (AKA: “deemed filing”) loophole and the file and suspend loophole.

Timing of multiple benefits

Prior to the reform, Social Security rules, individuals could claim spousal benefits without claiming their own Social Security benefits. By delaying claiming their own benefits, individuals could live, in part, off of spousal benefits while letting their own eventual monthly Social Security benefits grow larger.

Under the previous law, individuals who were eligible for both benefits — as a retired worker themselves and as the spouse (or qualified former spouse) of a retired worker – who were not yet at full retirement age had to apply for both benefits. They would then receive whichever of the two benefits was larger.

The new law expands the rules to apply not just to those who have not yet reached full retirement age, but also to those who have reached their full retirement age under Social Security rules.

The change means you can no longer receive one type of benefit while enjoying a bonus for postponing applying for the other benefit.

Who is affected? 

The law applies to all Social Security beneficiaries who turned age 62 on January 2ndof 2016 or later. However, the new rule does not apply to widow(ers), nor those who are receiving spousal benefits and who are also entitled to receive disability benefits from Social Security as well. Individuals who are receiving spousal benefits because they are caring for the retired worker’s child are also exempt from the new rule.

File and Suspend

The file and suspend loophole allowed beneficiaries who had reached full retirement age to apply for Social Security benefits, triggering payment of Social Security spousal benefits to a spouse. The retired worker could then voluntarily suspend his or her own benefits and let those benefits accrue, while still allowing the spouse to collect spousal benefits.

After the passage of the new law, if you suspend your own benefits, you will also suspend any other benefits you receive from another person’s record.

Example: Suppose you turn 66 this year – your full retirement age – and your spouse turns 62. You could start your benefits this year and take advantage of your full retirement age. Your spouse can also take advantage of his or her spousal benefits based on your record.

Under the previous law, if you suspended your benefit, your spouse could continue receiving benefits. Meanwhile, you let yours accrue until age 70. You get a higher monthly benefit for every month you postpone receiving them – and your spouses benefits could help you postpone them, because they provide some extra money for you to live on while you wait.

Under the new law, if you have not already requested to suspend your benefit by April 30th, 2016, your spouse’s spousal benefit will also be suspended as soon as you suspend your own benefits.

The rule does not apply to spouses who have divorced. If your ex-spouse suspends his or her benefit, it will not affect any spousal benefits you receive.

The new rules will apply to any individuals who turn in a request for a suspension on April 30th, 2016 or later. Note also that Medicare Part B premiums cannot be deducted from suspended benefits. If you are enrolled in Medicare Part B, you’ll be billed directly by the Center for Medicare & Medicaid Services for future Part B premiums, until you resume benefits. If you don’t pay the premiums, you could lose Part B benefits, which cover physician’s bills, lab fees and durable medical equipment.

Furthermore, if you are receiving SSI benefits, suspending your Social Security benefits will also make you ineligible for SSI.

The new rules will apply to any beneficiaries who suspend on or after April 30thof 2016.

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