Larry Kotlikoff and Terry Savage discuss essential strategies to safeguard against Social Security clawbacks while enhancing your benefits.
Have you ever encountered the term 'Social Security clawbacks'? If not, it’s crucial to tune in to this episode. Recently, one million Americans received notifications indicating that the Social Security Administration had incorrectly calculated their benefits. They were overpaid and had just 30 days to return the funds. How significant were these refunds? One couple faced a staggering $70,000, while another owed $52,000. It can take the government years, sometimes decades, to identify its errors. Regardless of fault, recipients must repay the amounts promptly, often within a month. The alarming aspect is that if repayment is refused, Social Security will halt your benefit checks until the debt is settled.
Most retirees or those approaching retirement don’t have $50,000 readily available to repay the government due to a Social Security clawback. Every dollar is critical during these times. So, what steps can you take to prepare if you’re among those who received such notices? Is there a way to challenge this?
In their latest book, “Social Security Horror Stories: Protect Yourself from the System and Avoid Clawbacks,” Kotlikoff and Savage recommend utilizing software to perform calculations and ascertain your payment before applying for Social Security benefits. Savage emphasizes that software can help determine your expected benefits and whether it’s wise to delay claiming them for a few additional years.
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If you’re currently receiving Social Security benefits, calculating your numbers can provide valuable insights regarding potential clawbacks or even if you’re being underpaid. Kotlikoff shares a story about a friend who, having outlived three husbands, never realized she could claim a divorced widow’s benefit from her first high-earning spouse. This oversight likely cost her nearly a million dollars in potential benefits.
Tune in to hear Kotlikoff and Savage's recommendations on maximizing your Social Security benefits and the best actions to take if you receive a clawback notice from the government.
