Social Security and You: Social Security Start Date Problem Solved?
Maybe the Social Security Administration fixed the problem? I guess we'll just have to wait and see.
So, what's the problem? I'm talking about an issue that, on the surface, sounds very simple. Yet over the years, hundreds, if not thousands, of readers have found it confusing and have written to me for clarification.
It's the answer to this simple-sounding question on the online Social Security retirement application form: "When do you want your benefits to start?"
The reason this confuses people is primarily because way too many folks overthink the question. And it is especially vexing for those who absolutely insist that their benefits start at their full retirement age -- not a month before and not a month later. (Near the end of this column, I will point out why people shouldn't get so hung up about this full retirement age start date business.)
But for now, here is an example. Frank wants to wait until he is 66 to start his Social Security. He turns 66 in March. So, when the application asks, "When do you want your benefits to start?" Frank should answer, "March." It really is that simple.
But then, as I said, Frank starts thinking too much. Here is what I mean by that. He knows that Social Security checks always come one month behind. In other words, the Social Security check for March is actually sent out in April. So now Frank worries that if he indicates he wants his benefits to start in March, the SSA will interpret that to mean he wants his first check to come in March, meaning it would be the payment for February. And if his benefits started in February, that would give him a one-month reduction in his full retirement age benefit rate.
And then Frank thinks even harder and figures that he better answer the question by saying he wants his benefits to start in April, knowing that would be the March Social Security payment.
As I have explained a thousand times in this column, don't worry about Social Security check payment dates. The application question is not asking when you want your first Social Security check to physically show up in your bank account. Instead, it is asking which month you want to be your first month of eligibility for Social Security benefits.
The folks at the Social Security Administration know this has been a problem because they have been getting lots of calls from panicked retirement applicants who misinterpreted the question and answered it incorrectly, or at least what they perceive to be incorrectly (more about that in a minute). So, they are calling to see if they can change their answer -- thus creating lots of extra work for the SSA representatives and computer systems.
But according to quite a few readers who have reported this to me, the SSA has changed the question asked on the online retirement form, at least for folks approaching their full retirement age. It now says this: "Do you want your benefits to start at the earliest date without a permanent reduction?"