The only constant is change. Do a little retirement planning, and you’ll soon bump into that truth. Earlier this month the U.S. government gave us another reminder: The Bipartisan Budget Act of 2015 made some of the most significant changes to Social Security benefits in years. Lawmakers unexpectedly tacked the changes onto an emergency measure to avoid a U.S. debt default, catching many observers by surprise. Though, since Social Security is a primary driver of U.S. debt, maybe we should be grateful our contentious government could muster some progress on its longstanding financial issues….
So, what has changed? The “file and suspend” and “restricted application” claiming strategies, obscure and complex options once available to two-earner couples, will soon belong to the past. These strategies were an unintended consequence of a law passed in 2000 to encourage working during retirement. They might have remained vague technicalities but for the introduction of software and books aimed at “getting what’s yours” out of Social Security. The loopholes grew in popularity.