October 2 Your Safe Money Show topics

 We're looking forward to our next installment of Your Safe Money Show this Saturday October 2 at 8 a.m. on Nice 95.5 FM KBEK. I want to look at smart ways to gift money to your children. I’ll also have tips before you sign up for health insurance at work. And we’ll look inside the psychology of overspending and how to stop overspending. KBEK streams live at kbek.com. Hear recent shows at our podcast page at yoursafemoneyshow.com.

Standard deduction

 Here's a reminder for the 2021 tax year:

The standard deduction amounts were increased for 2021 to account for inflation. Married couples get $25,100 ($24,800 for 2020), plus $1,350 for each spouse age 65 or older ($1,300 for 2020). Singles can claim a $12,550 standard deduction ($12,400 for 2020) — $14,250 if they're at least 65 years old ($14,050 for 2020). Head-of-household filers get $18,800 for their standard deduction ($18,650 for 2020), plus an additional $1,700 once they reach age 65. Blind people can tack on an extra $1,350 to their standard deduction ($1,700 if they're unmarried and not a surviving spouse).

If you have questions go to yoursafemoneyshow.com.

Medicare signup explained

 When to signup for Medicare:

If you are already taking Social Security benefits, you will be automatically enrolled in Parts A and B. You can choose to turn down Part B, since it has a monthly cost; if you keep it, the cost will be deducted from Social Security if you already claimed benefits. For those who have not started Social Security, you will have to sign yourself up for Parts A and B. The seven-month initial enrollment period begins three months before the month you turn 65 and ends three months after your birthday month. To ensure coverage starts by the time you turn 65, sign up in the first three months.

If you are still working and have health insurance through your employer (or if you’re covered by your working spouse’s employer coverage), you may be able to delay signing up for Medicare. But you will need to follow the rules and must sign up for Medicare within eight months of losing your employer’s coverage to avoid significant penalties when you do eventually enroll.

If you have questions call 320-679-5183 and get a no cost appointment, and remember Open enrollment for Medicare starts

October 15th and runs through December 7th.

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Highlights for September 25th Your Safe Money Show

 Coming up on our (Saturday) September 25th edition of Your Safe Money Show. If you are leaving an asset as inheritance, there are some assets that can create more trouble than they’re worth, I’ll explain that. Plus, I have the downside of delaying RMD’s (Required Minimum Distributions). And we’ll look at the financial perks of growing older. Listen at 8 a.m. at Nice 95.5 FM KBEK. They stream live at kbek.com. Hear recent shows at our podcast page at yoursafemoneyshow.com.

Open enrollment schedule

 Open enrollment for Medicare starts October 15th and runs through December 7th. MnSure open enrollment starts November 1st and runs until December 15th if you need your insurance to start January 1st. Enrollment continues until January 15th but insurance won't start until February 1st. Call for your appointment at 320-679-5183.

Dispelling misconceptions with Social Security

 OK let’s continue this week with dispelling the misconceptions when it comes to Social Security. Again, we are getting this information right from ssa.gov. We have two questions and answers this week: First: Which political party eliminated the income tax deduction for Social Security (FICA) withholding? The answer: There was never any provision of law making the Social Security taxes paid by employee’s deductible for income tax purposes. In fact, the 1935 law expressly forbid this idea, in Section 803 of Title VIII. Next question: Which political party started taxing Social Security annuities? The taxation of Social Security began in 1984 following passage of a set of Amendments in 1983, which were signed into law by President Reagan in April 1983. These amendments passed the Congress in 1983 on an overwhelmingly bi-partisan vote. The basic rule put in place was that up to 50% of Social Security benefits could be added to taxable income, if the taxpayer's total income exceeded certain thresholds. The taxation of benefits was a proposal which came from the Greenspan Commission appointed by President Reagan and chaired by Alan Greenspan (who went on to later become the Chairman of the Federal Reserve). If you want to get into more details about this, go to ssa.gov they have links and you can download the full text of the Greenspan report and the provisions of the 1983 law.

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Your Safe Money Show topics for September 18th

 Here is what we're working on for this Saturday's (September 18th) Your Safe Money Show. We have just two topics this week to discuss and that’s because the one topic will take up extra time and that’s "questions retirees often get wrong when it comes to taxes in retirement". And what is a notarized document and where can I get something notarized? Please listen at 8 a.m. Saturday's at Nice 95.5 FM KBEK, They stream live at kbek.com. Hear recent shows by going to the podcast page at yoursafemoneyshow.com.

Where to find unclaimed money

 Here's some good information to know: If you believe you have unclaimed money left in a bank account long ago, check out MissingMoney.com or Unclaimed.org, which are both operated by the National Association of Unclaimed Property Administrators. If you used to belong to a credit union, you may want to consult www.ncua.gov/support-services/unclaimed-deposits, a site managed by the National Credit Union Administration, where you may find an unclaimed deposit.

Questions for Social Security

 

We all know there’s misinformation circulating these days and Social Security is no stranger to these myths and falsehoods so in the next couple weeks I’ll share what’s available right from ssa.gov and clear up some of these misconceptions. Question: Which political party took Social Security from the independent trust fund and put it into the general fund so that Congress could spend it?

Answer: There has never been any change in the way the Social Security program is financed or the way that Social Security payroll taxes are used by the federal government. The Social Security Trust Fund was created in 1939 as part of the Amendments enacted in that year. From its inception, the Trust Fund has always worked the same way. The Social Security Trust Fund has never been "put into the general fund of the government." Most likely this question comes from a confusion between the financing of the Social Security program and the way the Social Security Trust Fund is treated in federal budget accounting. Starting in 1969 (due to action by the Johnson Administration in 1968) the transactions to the Trust Fund were included in what is known as the "unified budget." This means that every function of the federal government is included in a single budget. This is sometimes described by saying that the Social Security Trust Funds are "on-budget." This budget treatment of the Social Security Trust Fund continued until 1990 when the Trust Funds were again taken "off-budget." This means only that they are shown as a separate account in the federal budget. But whether the Trust Funds are "on-budget" or "off-budget" is primarily a question of accounting practices--it has no effect on the actual operations of the Trust Fund itself.

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Your Safe Money Show topics for September 11th

 Here's what we're planning for this Saturday's Your Safe Money Show, heard on Nice 95.5 FM at 8 a.m., they stream live at kbek.com. Things can go wrong when families are transferring wealth to the next generation, I’ll explain how to remedy that. I also have questions children can ask their aging parents about their finances. And there’s many older folks that have retired and they’re ready to volunteer and help out on a scale never before seen. I’ll go into that as well. If you can't listen at 8 on Saturday mornings remember you can hear the podcast anytime by going to yoursafemoneyshow.com at the podcast page.

Medicare "doughnut hole" explained

 I probably get more questions about the “doughnut hole” in regard to Medicare because it used to be even a bigger problem than today. In 2020 the dreaded Part D "doughnut hole" was filled. That hole is a coverage gap in which you used to face much higher out-of-pocket costs for your drugs, but that is no longer the case. For 2021, the coverage gap begins when the total amount your plan has paid for your drugs reaches $4,130 (up from $4,020 in 2020). At that point, you’re in the doughnut hole, where you’ll now receive a 75% discount on both brand-name and generic drugs. Prescription drug manufacturers pick up 70% of that tab and insurers 5%. You pay the remaining 25%. Catastrophic coverage, with the government picking up most costs, begins when a patient's out-of-pocket costs reach $6,550, the maximum spending limit for beneficiaries in 2021, which is $200 higher than 2020’s cap. Any deductible paid before you entered the doughnut hole counts toward that annual maximum as does the 25% you contributed while in the doughnut hole and the 70% that pharmaceutical companies paid on your behalf. If you have questions call 320-679-5183 or go to yoursafemoneyshow.com. Open enrollment for Medicare starts October 15th.

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Closed labor Day

  Everyone at Sjoberg & Holmstrom Financial Services and Your Safe Money Show wish you a safe and enjoyable Labor Day weekend. We will be closed Labor Day Monday. You can leave a message at 320-679-5183. We open at 8 a.m. on Tuesday September 7th.  

Here's what to expect for the September 4th edition of Your Safe Money Show

 Your Safe Money Show highlights for Saturday September 4th.

We’ll have a list of things for you to account for when planning to retire. Understanding how to manage your credit cards is essential to having a good handle on your finances, I’ll go into detail on that. And if you’re nearing retirement this might be a good time to do away with some of your possessions. Listen at 8 a.m. at Nice 95.5FM KBEK. They stream live at kbek.com. Hear recent shows at our podcast page at yoursafemoneyshow.com.

Social Security numbers

 

Is there any significance to the numbers assigned in the Social Security Number?

A: Yes. Originally, the first three digits are assigned by the geographical region in which the person was residing at the time he/she obtained a number. Generally, numbers were assigned beginning in the northeast and moving westward. So people on the east coast have the lowest numbers and those on the west coast have the highest numbers. The remaining six digits in the number are more or less randomly assigned and were organized to facilitate the early manual bookkeeping operations associated with the creation of Social Security in the 1930s.

Beginning on June 25, 2011, the SSA implemented a new assignment methodology for Social Security Numbers. The project is a forward looking initiative of the Social Security Administration (SSA) to help protect the integrity of the SSN by establishing a new randomized assignment methodology. SSN Randomization will also extend the longevity of the nine-digit SSN nationwide.