WEBVTT NOTE This file was generated by Descript 00:00:05.027 --> 00:00:08.107 Welcome to the fiscal firehouse, a podcast dedicated to promoting 00:00:08.107 --> 00:00:09.997 financial literacy to firefighters. 00:00:10.177 --> 00:00:13.877 I'm your cohost, John Beatty, executive board member of local 1309, 00:00:14.147 --> 00:00:18.567 a lieutenant, and also a certified financial planner with me, I have the 00:00:18.567 --> 00:00:22.297 other cohost of the fiscal firehouse, Louie Borrella, executive board member 00:00:22.297 --> 00:00:26.847 of local 1309 ambulance driver, and want to be financial expert together. 00:00:26.847 --> 00:00:29.577 John and I hope to bring clarity to the world of personal finance, 00:00:29.587 --> 00:00:31.357 specifically relating to firefighters. 00:00:31.847 --> 00:00:33.327 Firefighting is a difficult job. 00:00:33.727 --> 00:00:35.817 Making sound financial decisions shouldn't be. 00:00:37.757 --> 00:00:40.937 In today's episode of the Fiscal Firehouse, John and Louie 00:00:40.977 --> 00:00:42.917 will discuss Social Security. 00:00:43.427 --> 00:00:46.567 John and Louie will talk about the different components of Social Security. 00:00:46.977 --> 00:00:48.327 How you become eligible. 00:00:48.327 --> 00:00:50.777 When you can start claiming social security and some 00:00:50.777 --> 00:00:52.187 of the additional benefits 00:00:52.277 --> 00:00:56.007 John and Louie will also talk about the social security fairness act 00:00:56.057 --> 00:01:02.577 that was recently signed into law by president Biden on January 5th of 2025. 00:01:03.237 --> 00:01:07.477 Without further ado, we're going to turn it over to local 1309 studios and 00:01:07.477 --> 00:01:09.617 the recording of the fiscal firehouse. 00:01:11.914 --> 00:01:14.264 Jon: Welcome back to the fiscal firehouse. 00:01:14.364 --> 00:01:15.334 This is your co host. 00:01:15.334 --> 00:01:17.244 John Beatty with me as always. 00:01:17.244 --> 00:01:22.624 I've got my partner in crime here Louie Bruella say hi louie Good to see you louie 00:01:22.784 --> 00:01:23.414 good to be back. 00:01:23.414 --> 00:01:25.724 We took a kind of an extended break because of the holidays and 00:01:25.724 --> 00:01:29.744 stuff, but I'm excited to get the podcast going again and start with 00:01:29.744 --> 00:01:30.824 the new episode for the new year. 00:01:30.854 --> 00:01:32.554 Yeah, fresh 2025. 00:01:32.564 --> 00:01:35.064 Hopefully everyone had a wonderful holiday season. 00:01:35.514 --> 00:01:36.724 Everyone was safe out there. 00:01:36.734 --> 00:01:39.624 Hopefully the the bugs and the germs didn't get you too bad, like they 00:01:39.634 --> 00:01:41.364 wiped out Louie and I's family. 00:01:41.469 --> 00:01:44.049 louie: I think everyone, everyone I'm hearing at the fire stations are like, 00:01:44.049 --> 00:01:47.459 yeah, we, it slaughtered us earlier this year or something like that. 00:01:47.459 --> 00:01:49.249 So I think it went through and got everyone. 00:01:49.364 --> 00:01:52.254 Jon: It was in a tense, intense sickness season. 00:01:52.254 --> 00:01:54.734 So we're all back and we're ready to go. 00:01:54.734 --> 00:01:58.614 So in this episode, we are going to talk about social security. 00:01:58.794 --> 00:01:59.924 Everyone's favorite. 00:02:00.169 --> 00:02:00.969 louie: get, get nothing. 00:02:00.969 --> 00:02:01.709 Gets the blood going. 00:02:01.719 --> 00:02:02.549 Like social security. 00:02:02.584 --> 00:02:03.354 Jon: Oh my God. 00:02:03.364 --> 00:02:04.294 This is one that it's. 00:02:04.349 --> 00:02:04.829 Tough. 00:02:04.829 --> 00:02:07.979 When Lou and I were talking about topics we're like, do we really want 00:02:07.979 --> 00:02:09.449 to try to tackle social security? 00:02:09.449 --> 00:02:11.279 'cause this is typically a big honker. 00:02:11.279 --> 00:02:13.379 People get bored out of their minds talking about this. 00:02:13.439 --> 00:02:16.289 And it's a very complex topic as well. 00:02:16.619 --> 00:02:18.839 Listen folks, we know you're turning and going, man. 00:02:18.839 --> 00:02:20.879 Or you saw the title and you were like, social security. 00:02:20.879 --> 00:02:23.129 I probably shouldn't even know, is this for your granddaddy? 00:02:23.129 --> 00:02:25.199 Has this a granddaddy's podcast? 00:02:25.319 --> 00:02:26.129 But this is for you. 00:02:26.189 --> 00:02:29.159 Like we, we actually think this is an important part of your 00:02:29.339 --> 00:02:32.359 louie: Path to financial independence and your path to financial security. 00:02:32.659 --> 00:02:33.819 So that's why we're doing it. 00:02:33.819 --> 00:02:36.869 And especially with the big updates to social security that we'll talk about, we 00:02:36.869 --> 00:02:38.769 think that it's very relevant right now. 00:02:38.769 --> 00:02:42.269 And we want it to have a relevant episode for you guys, because there's probably 00:02:42.269 --> 00:02:43.539 a lot of questions going around it. 00:02:43.549 --> 00:02:47.069 So not just for the old guys at the department, but for the young folks 00:02:47.069 --> 00:02:49.879 too, we think that this is a really important thing to discuss right now 00:02:50.099 --> 00:02:54.699 because it's going to be, it's going to be important for your future someday. 00:02:54.909 --> 00:02:59.069 Maybe not, maybe not for 20 years or 30 years, but someday this will be important. 00:02:59.254 --> 00:02:59.794 Jon: That's right. 00:02:59.794 --> 00:03:02.994 So whether you're day one on the job or whether you're not, we've 00:03:02.994 --> 00:03:05.534 got some of our retirees that are listening to the podcast. 00:03:05.534 --> 00:03:07.224 So shout out to all those guys. 00:03:07.634 --> 00:03:10.104 whether you're retired or you're getting ready to retire, or like I 00:03:10.104 --> 00:03:12.804 said, day one, you'll get something out of this and it'll be beneficial. 00:03:12.814 --> 00:03:17.064 So really what we're going to talk about today though, is when we did our last 00:03:17.114 --> 00:03:21.124 recruit presentation about financial literacy, we actually opened up with 00:03:21.124 --> 00:03:25.264 one of these questions, like a raise of hands of how many of you think that 00:03:25.264 --> 00:03:29.774 social security is going to be around when you're ready to collect in 30, 40 00:03:29.784 --> 00:03:33.534 years for some of them, it was pretty surprising to see the amount of hands 00:03:33.534 --> 00:03:38.334 that were not optimistic to say the least about what that could potentially mean. 00:03:38.414 --> 00:03:38.684 louie: Yeah. 00:03:38.744 --> 00:03:40.904 I think people have been like, they've been conditioned, right. 00:03:40.904 --> 00:03:43.814 To be like, oh, that's social security's for old people, but when 00:03:43.814 --> 00:03:44.864 we're there, it's gonna be broke. 00:03:44.864 --> 00:03:46.974 It's gonna be bankrupt, and there's gonna be zero. 00:03:47.034 --> 00:03:47.334 Nothing. 00:03:47.334 --> 00:03:49.074 We're getting a nothing for social security. 00:03:49.074 --> 00:03:52.809 I think that's a very common belief among people under. 00:03:53.669 --> 00:03:55.049 30 or even 40 years old. 00:03:55.229 --> 00:03:55.959 Jon: do you think that is? 00:03:57.049 --> 00:03:58.779 louie: Because it's always in the news, right? 00:03:58.779 --> 00:04:01.239 Whenever there's a shortfall, you hear about the social security shortfall. 00:04:01.239 --> 00:04:04.989 You hear that it's going to run out of money by 2030 whatever. 00:04:05.279 --> 00:04:09.689 And so you just hear there's a shortfall government, doesn't know how to manage it. 00:04:09.689 --> 00:04:11.119 They don't know how to say for it. 00:04:11.119 --> 00:04:12.199 They can't agree on it. 00:04:12.199 --> 00:04:14.919 And so it's just going to go bankrupt and just going to disappear. 00:04:15.194 --> 00:04:15.924 Jon: And I think that's it. 00:04:15.924 --> 00:04:18.164 I think there's a lot of fear mongering out there when it comes 00:04:18.164 --> 00:04:19.594 to social security specifically. 00:04:19.594 --> 00:04:22.334 And I think that's one of the big misconceptions when they actually 00:04:22.334 --> 00:04:26.334 say that, social security is going to run out of money in 2034, 2035, 00:04:26.334 --> 00:04:27.954 whatever the latest projections are. 00:04:28.294 --> 00:04:30.614 What people don't understand is it's not going to run out of money. 00:04:30.614 --> 00:04:31.934 They're still going to pay benefits. 00:04:32.139 --> 00:04:34.129 But it might not be a hundred percent of your benefit. 00:04:34.129 --> 00:04:36.249 It might be 80 percent or whatever that looks like. 00:04:36.249 --> 00:04:40.749 So big misconception, but Louie and I want to just dispel, or at least our 00:04:40.749 --> 00:04:44.779 personal opinions about social security is we do feel like it's going to be 00:04:44.779 --> 00:04:49.009 there in five years and 10 years, 20 years, 30 years down the line, some 00:04:49.009 --> 00:04:51.999 form of social security is going to be there now they might have to go 00:04:51.999 --> 00:04:55.619 down some significant reforms and we'll talk about potentially what some 00:04:55.619 --> 00:04:57.139 of those reforms could be, but, and. 00:04:57.229 --> 00:05:00.289 At least in our opinions, we truly believe that it's such a, a 00:05:00.289 --> 00:05:02.719 cornerstone of American society. 00:05:02.919 --> 00:05:05.309 And there's a lot of people, unfortunately, that this is their 00:05:05.309 --> 00:05:09.859 primary retirement vehicle that they use to survive and not be impoverished. 00:05:10.409 --> 00:05:10.809 So it's 00:05:11.139 --> 00:05:14.209 louie: are going to be eating a lot of cat food if social security goes away 00:05:14.529 --> 00:05:16.569 and I'll just say this, like, it's, a. 00:05:17.449 --> 00:05:22.079 Omni political thing Neither party is going to be the party that kills 00:05:22.099 --> 00:05:23.959 social security republicans democrats. 00:05:23.969 --> 00:05:27.829 It doesn't matter especially because the vast majority of those voters 00:05:27.849 --> 00:05:33.849 for both parties are from the Social security eligible population. 00:05:33.849 --> 00:05:36.079 It's those people that are voting for the politicians. 00:05:36.079 --> 00:05:41.089 That's why we have so many old ass people in congress right now, which Is a 00:05:41.089 --> 00:05:44.899 different story that we have to go on but the truth is like That's who is voting. 00:05:44.919 --> 00:05:46.369 They vote in droves. 00:05:46.819 --> 00:05:50.199 And so they're not going to be the ones that are forcing the grandma and grandpa 00:05:50.199 --> 00:05:52.279 to start eating cat food in retirement. 00:05:52.289 --> 00:05:56.029 So John and I do believe once again, that social security will 00:05:56.029 --> 00:05:57.339 be there for you when you retire. 00:05:57.659 --> 00:05:59.029 We don't know if it'll look like you. 00:05:59.264 --> 00:06:03.124 Can't take benefits until you're 65 or 68 or something like that if they're 00:06:03.124 --> 00:06:05.894 going to raise the age In order to collect benefits or if they're going 00:06:05.894 --> 00:06:09.674 to reduce the amount of benefit that you get But in some shape or form we 00:06:09.674 --> 00:06:11.084 believe social security will be there 00:06:11.113 --> 00:06:11.322 Jon: there. 00:06:11.322 --> 00:06:14.019 Yep, and that's why we wanted to talk about this because if we thought that 00:06:14.019 --> 00:06:17.639 this was Literally going to go away in the next couple years or it wasn't going to 00:06:17.639 --> 00:06:20.739 be a benefit for our members We wouldn't waste our breaths talking about it. 00:06:20.739 --> 00:06:23.614 But we do both believe that's true This is going to be a part 00:06:23.644 --> 00:06:25.254 of our members retirement plan. 00:06:25.254 --> 00:06:27.814 So we just want to talk about the, a little bit of the history. 00:06:28.104 --> 00:06:31.834 So a little history lesson here on social security, but also how it's going to 00:06:31.884 --> 00:06:36.164 apply to our members, especially now that the social security fairness act has 00:06:36.164 --> 00:06:38.784 been signed by former president Biden. 00:06:38.794 --> 00:06:40.484 So we'll talk about that at the very end. 00:06:40.484 --> 00:06:44.104 So we'll just start with a little bit of a history lesson about social security. 00:06:44.104 --> 00:06:46.554 So when doing some research, I've forgotten. 00:06:46.554 --> 00:06:50.394 A lot about kind of the backstory about where social security got started. 00:06:50.394 --> 00:06:54.164 For those history buffs, it was enacted back by president 00:06:54.444 --> 00:06:57.624 Theodore Roosevelt back in 1935. 00:06:57.634 --> 00:07:01.564 almost 90 years ago, it's been implemented and it was really started 00:07:01.814 --> 00:07:07.079 based on, if you guys remember history, Mid 1930s, early 1930s was 00:07:07.089 --> 00:07:08.809 all about the Great Depression, right? 00:07:08.809 --> 00:07:11.299 So they had a tremendous amount of unemployment. 00:07:11.539 --> 00:07:15.529 They saw a tremendous amount of poverty happening to the citizens in the 00:07:15.529 --> 00:07:18.879 United States and they wanted to have some type of program that would help 00:07:18.929 --> 00:07:20.529 support them in their time of need. 00:07:20.819 --> 00:07:23.759 And there's actually a quote that I thought was interesting to talk about 00:07:23.759 --> 00:07:26.059 what the intent of Social Security was. 00:07:26.309 --> 00:07:29.469 And then I'm going to talk a little bit about how the benefits have been enhanced. 00:07:29.614 --> 00:07:31.654 Enhanced over the last 90 years or 00:07:31.834 --> 00:07:34.104 louie: Just to, just to point clarification real quick, so 00:07:34.104 --> 00:07:35.414 we don't get the hate mail. 00:07:35.584 --> 00:07:36.984 You said Theodore Roosevelt. 00:07:37.374 --> 00:07:37.664 Teddy. 00:07:37.694 --> 00:07:38.324 Brr, brr, brr. 00:07:38.324 --> 00:07:38.624 Fuck. 00:07:38.984 --> 00:07:39.974 No, it would've been Franklin. 00:07:40.034 --> 00:07:41.654 Franklin, FDR would've done it. 00:07:41.684 --> 00:07:43.704 Jon: So yeah, Teddy was in the 1800s. 00:07:43.924 --> 00:07:46.314 So yeah, as you can tell fact check me. 00:07:46.324 --> 00:07:47.054 Thank you. 00:07:47.404 --> 00:07:48.404 No, Hey, no, 00:07:48.464 --> 00:07:50.144 louie: come back in later and be like, these guys dunno 00:07:50.144 --> 00:07:51.044 what they're talking about. 00:07:51.224 --> 00:07:51.704 We do. 00:07:51.994 --> 00:07:52.564 Jon: exactly. 00:07:52.584 --> 00:07:56.154 So no, that's why Louie, once again, I, I don't know why I'm on the 00:07:56.164 --> 00:07:58.744 podcast, but Louie is my fact checker. 00:07:58.744 --> 00:08:01.304 So yes, Thank you, not Teddy, but FDR. 00:08:01.524 --> 00:08:03.064 Theodore was way before him. 00:08:03.114 --> 00:08:03.324 Yeah. 00:08:03.324 --> 00:08:09.174 FDR basically said we can never ensure 100 percent of the population against 100 00:08:09.174 --> 00:08:13.154 percent of the hazards and vicissitudes of life, but we have tried to frame 00:08:13.154 --> 00:08:16.454 a law, which will give some measure of protection to the average citizen. 00:08:16.694 --> 00:08:21.854 And to his family against the loss of a job and against poverty ridden old age 00:08:22.034 --> 00:08:25.834 So he basically made those comments when he signed that into law So once again, 00:08:25.834 --> 00:08:29.784 if you're thinking about the intent of social security originally, it really was 00:08:29.854 --> 00:08:35.114 a backstop to help society to help our citizens that they would have the basic 00:08:35.114 --> 00:08:39.174 necessities of life covered by Social Security and they wouldn't be impoverished 00:08:39.174 --> 00:08:42.654 and they wouldn't have all these other challenges that our society faced. 00:08:42.654 --> 00:08:48.024 So that's really the history behind where and why Social Security got formed. 00:08:48.544 --> 00:08:51.734 But really when you think about Social Security, Most of us think 00:08:51.734 --> 00:08:53.104 about the retirement benefit. 00:08:53.194 --> 00:08:57.134 I would say the vast majority of people when you talk about Social Security That's 00:08:57.134 --> 00:09:01.174 immediately what they think about but really there is a couple other components 00:09:01.174 --> 00:09:05.464 of Social Security that I think It's good to know What they are and it's also 00:09:05.464 --> 00:09:09.334 good to know because how the funding mechanisms of Social Security happen. 00:09:09.334 --> 00:09:12.714 So Besides retirement benefits, which is what we think about when 00:09:12.714 --> 00:09:14.224 we think about social security. 00:09:14.454 --> 00:09:18.944 There also are disability benefits So disability benefits are one of those 00:09:18.944 --> 00:09:22.864 and trust me This is something that you never want to have to qualify for And 00:09:22.864 --> 00:09:27.354 to my knowledge this is something that is extremely difficult to qualify for in 00:09:27.354 --> 00:09:31.094 order to get social security disability benefits Like that's no quality of 00:09:31.094 --> 00:09:34.114 life that I would wish on any one of our members so that's not something 00:09:34.114 --> 00:09:36.254 that we're advocating for but it is you 00:09:36.354 --> 00:09:39.174 louie: It's not like I have some slight hearing loss, so I'm gonna go get some 00:09:39.174 --> 00:09:40.584 social security benefits from that. 00:09:40.584 --> 00:09:41.284 It's like, 00:09:41.394 --> 00:09:45.194 Jon: No, so it would basically be, I know a lot of our members are familiar 00:09:45.864 --> 00:09:49.754 with disability benefits through FPPA, through our Pension or Death of Disability 00:09:49.754 --> 00:09:51.914 program, which is an amazing program. 00:09:52.124 --> 00:09:54.564 And we have a lot of, I shouldn't say a lot, but we've had plenty of 00:09:54.564 --> 00:09:58.074 members that have qualified for a disability, a medical disability, right? 00:09:58.364 --> 00:09:59.964 None of those members that have left are disabled. 00:10:00.024 --> 00:10:04.104 Got social security disability benefits like this would basically be a full 00:10:04.104 --> 00:10:07.474 on occupational disability where you can't work anymore And like I said, 00:10:07.474 --> 00:10:11.074 that is not That is not an illness or a situation that we would wish any one 00:10:11.074 --> 00:10:14.874 of our members on but just know that it is there As a backstop, to help our 00:10:14.874 --> 00:10:19.254 citizens Really in their time of need where they can't have gainful employment 00:10:19.254 --> 00:10:22.974 They can't do anything and it helps, you know support them in their daily endeavors 00:10:23.334 --> 00:10:23.594 louie: Yep. 00:10:24.884 --> 00:10:28.174 Jon: So another another benefit as well is the survivor benefit. 00:10:28.464 --> 00:10:32.004 So once again, this is something that if you qualify for social security 00:10:32.004 --> 00:10:35.194 and, and Louie and I will talk about the eligibility here in just a minute, 00:10:35.464 --> 00:10:39.594 but if you do qualify for social security and you do have a dependent 00:10:39.654 --> 00:10:42.904 if you pass away, those dependents would get a certain survivor benefit. 00:10:42.914 --> 00:10:45.324 And there's a whole big formula that we're not going to get into. 00:10:45.614 --> 00:10:50.094 But once again, that's going back to the original intent of FDR and just trying to 00:10:50.094 --> 00:10:53.007 peak I'm not sure if that's a good thing to do, but I think that's a good thing. 00:10:53.007 --> 00:10:54.939 keep people from being impoverished and being able to have some quality 00:10:54.939 --> 00:10:55.905 of life where they wouldn't be 00:10:55.927 --> 00:10:57.627 louie: And that's much easier to qualify for. 00:10:57.637 --> 00:11:00.737 For the dependents of workers who have earned their social security 00:11:00.737 --> 00:11:03.817 benefit when they pass away the federal government is pretty good about. 00:11:04.152 --> 00:11:08.152 giving those people their social security benefits because they know that families 00:11:08.152 --> 00:11:12.752 need it, that some of these survivors would really go on the streets if it 00:11:12.762 --> 00:11:14.982 wasn't for a check from social security. 00:11:14.982 --> 00:11:16.282 So they're pretty good about that. 00:11:16.402 --> 00:11:17.472 At least that's my understanding. 00:11:17.698 --> 00:11:22.122 Jon: And then the last kind of component if you will is what's called the SSI 00:11:22.452 --> 00:11:26.782 Or the supplemental social security income So this is either lower income 00:11:26.802 --> 00:11:31.322 or if they have, you know A disability through their age or they're blind or 00:11:31.322 --> 00:11:34.412 something else like this It just gives them an additional amount of money 00:11:34.442 --> 00:11:38.082 on top of what their original social security benefit would have been Ben. 00:11:38.082 --> 00:11:42.252 So those are the umbrella of social security, if you will, but the, if, 00:11:42.492 --> 00:11:46.112 if you can imagine the majority of the money that social security spends 00:11:46.112 --> 00:11:50.182 out on a yearly basis, the majority of that is for retirement benefits 00:11:50.212 --> 00:11:52.942 and not disability or survivor. 00:11:53.137 --> 00:11:55.787 Or the SSI, the supplemental social security. 00:11:55.787 --> 00:11:58.857 So just a little backstory on social security and kind 00:11:58.857 --> 00:12:00.147 of the different components. 00:12:00.147 --> 00:12:02.767 So when you're thinking about social security though, I think it's good 00:12:02.767 --> 00:12:07.087 idea to figure out exactly how it's funded, So they always talk about the 00:12:07.087 --> 00:12:09.317 funding mechanism and whether or not. 00:12:09.337 --> 00:12:10.497 It's going to run out of money. 00:12:10.497 --> 00:12:13.907 So once again, if you're thinking about how social security is going to 00:12:13.907 --> 00:12:18.307 be funded, it basically gets funded through what are called your FICA taxes. 00:12:18.337 --> 00:12:21.907 And I know in previous episodes at some point or another, we had talking 00:12:21.907 --> 00:12:25.947 about FICA taxes, but that stands for federal insurance contribution act. 00:12:26.267 --> 00:12:26.747 All right. 00:12:26.747 --> 00:12:30.577 So these, this is a certain amount of money that you pay into social security 00:12:30.577 --> 00:12:32.487 and it's, it ends up being 12, 000. 00:12:32.487 --> 00:12:37.937 And typically it's split between the employee and the employer. 00:12:37.937 --> 00:12:39.677 So as the employee, 6. 00:12:39.677 --> 00:12:43.447 2 percent of your wages would go into Social Security, and then your 00:12:43.447 --> 00:12:45.757 employer would pick up the other 6. 00:12:45.827 --> 00:12:45.957 2%. 00:12:46.437 --> 00:12:50.057 For those of you that are self employed whether that's, you got a side job 00:12:50.067 --> 00:12:53.347 from the FD and you run your own business or your spouse or someone 00:12:53.347 --> 00:12:56.287 else is self employed, they basically have to make up that whole amount. 00:12:56.337 --> 00:12:56.557 Yep. 00:12:56.572 --> 00:12:57.832 They pay up both sides. 00:12:57.832 --> 00:12:58.972 So 12.4% 00:12:59.242 --> 00:13:02.572 now they end up getting a tax deduction at the end to make it equal. 00:13:02.762 --> 00:13:06.872 But just know if when they front load that you end up paying the whole 12.4%. 00:13:06.922 --> 00:13:10.302 louie: And this is important to know that when we're talking about this, that's for 00:13:10.352 --> 00:13:14.532 those jobs that pay into social security, which we've mentioned in the last podcast, 00:13:14.532 --> 00:13:19.462 I believe, but we'll just reiterate if you are an employee with our department 00:13:19.732 --> 00:13:25.472 or I think probably any other professional firefighter department in Colorado for 00:13:25.472 --> 00:13:26.982 sure and almost across the country. 00:13:27.382 --> 00:13:30.082 You are not paying into social security. 00:13:30.092 --> 00:13:32.122 You do not pay that 6. 00:13:32.122 --> 00:13:32.572 2%. 00:13:32.572 --> 00:13:34.662 The department is not paying that 12. 00:13:34.692 --> 00:13:35.332 4%. 00:13:35.722 --> 00:13:39.722 And so you are not earning eligibility credits, which we'll 00:13:39.752 --> 00:13:40.772 get to in a little bit here. 00:13:41.032 --> 00:13:42.682 You are not earning, you're not paying into it. 00:13:43.052 --> 00:13:46.912 Jon: Yeah, 100 percent so I think that's a great clarification there. 00:13:46.912 --> 00:13:50.392 So yeah, this is just talking in general and I think it's something the research 00:13:50.392 --> 00:13:54.542 I found it's something like 96 percent of workers pay into Social Security So 00:13:54.542 --> 00:13:58.392 we're that weird 4 percent of folks that that don't pay into Social Security. 00:13:58.392 --> 00:14:03.952 So that's the funding mechanism and that is not to be misconstrued or With 00:14:03.982 --> 00:14:07.692 Medicare, because sometimes those things overlap and there's a lot of confusion. 00:14:08.002 --> 00:14:11.732 So what you pay into social security is not what you pay into Medicare. 00:14:12.052 --> 00:14:14.372 So what you pay into Medicare is 1. 00:14:14.392 --> 00:14:17.312 45 percent of your salary. 00:14:17.332 --> 00:14:20.222 And that is something that we do as employees at West Metro. 00:14:20.222 --> 00:14:21.322 Basically everyone pays 00:14:21.332 --> 00:14:22.322 louie: I was gonna say every, is there 00:14:22.422 --> 00:14:23.402 Jon: can't opt out of it. 00:14:23.547 --> 00:14:23.877 Nope. 00:14:23.877 --> 00:14:25.807 So basically everyone pays into that. 00:14:25.807 --> 00:14:27.317 So we pay 1. 00:14:27.347 --> 00:14:30.447 percent and then the employer also kicks in 1. 00:14:30.477 --> 00:14:31.587 percent to be called 2. 00:14:31.587 --> 00:14:32.287 9. 00:14:32.357 --> 00:14:35.257 And that's something that social security has a wage base. 00:14:35.657 --> 00:14:40.557 So I think for this year, it's something like 176, 000 worth of earned income 00:14:40.557 --> 00:14:42.747 will be subject to social security. 00:14:42.827 --> 00:14:45.567 And then anything earned after that, they don't take anything out. 00:14:45.567 --> 00:14:48.497 So it actually is capped based on how much money you make. 00:14:48.497 --> 00:14:51.377 That's something when we talk about funding possibly in the future 00:14:51.387 --> 00:14:55.547 something that congress could go after is obviously make that Wage base 00:14:55.547 --> 00:14:58.997 increase or unlimited so they could continue to get some funds in there So 00:14:58.997 --> 00:15:03.347 that that's basically what keeps for the most part social security funded 00:15:03.347 --> 00:15:06.207 So if you think a lot about that 12. 00:15:06.317 --> 00:15:10.497 4 that's going into Very similar to how our pension works, right? 00:15:10.497 --> 00:15:13.307 So we have people that are actively paying into our pension. 00:15:13.637 --> 00:15:17.677 They are producing You Contributions and those contributions are then invested 00:15:17.977 --> 00:15:22.057 and then those investments pay out the beneficiaries So our pensioners get 00:15:22.057 --> 00:15:26.407 that money at the end when they retire Social security is set up very similar 00:15:26.647 --> 00:15:30.507 that the majority of money that is how social security is being funded 00:15:30.807 --> 00:15:36.207 Is through those payroll taxes now you also do Unfortunately get taxed when you 00:15:36.207 --> 00:15:40.852 do get social security income And some of that taxes for your social security 00:15:40.862 --> 00:15:45.502 income actually help support the funding mechanism behind social security. 00:15:45.707 --> 00:15:50.027 louie: sounds like Double taxation, John, but I know we don't have that in the 00:15:50.027 --> 00:15:52.577 United States, so I don't, I don't get 00:15:52.832 --> 00:15:53.262 Jon: Yep. 00:15:53.352 --> 00:15:57.352 Nope you it is one of the rare circumstances in which you truly could 00:15:57.352 --> 00:16:01.702 look at that as a form of double taxation and we taxed it on the way going in for 00:16:01.702 --> 00:16:06.642 payroll taxes And then when you take it out on income you get taxed on it again. 00:16:06.682 --> 00:16:10.662 Now, there are certain states that Limit the amount of money that they'll 00:16:10.672 --> 00:16:14.302 that they'll take out Charge you for for social security or what their 00:16:14.302 --> 00:16:18.962 tax but federally you're pretty much with the majority of people About 00:16:18.972 --> 00:16:22.412 85 percent of your social security is going to be taxed to some degree. 00:16:22.412 --> 00:16:23.542 So that's 00:16:23.662 --> 00:16:24.142 louie: getting his. 00:16:24.192 --> 00:16:28.642 Jon: Getting his getting his and once again most of that money goes to 00:16:28.642 --> 00:16:32.832 fund the benefits for retirees, the retirement benefit, not so much for 00:16:32.832 --> 00:16:35.762 those other components like disability and survivor and stuff like that. 00:16:35.762 --> 00:16:41.592 So that's more or less how social security gets funded, the mechanism behind it. 00:16:41.642 --> 00:16:44.292 And, when they talk about shortfalls in it, that's really 00:16:44.292 --> 00:16:45.062 what they're talking about. 00:16:45.062 --> 00:16:48.092 There's just not enough money that they're accruing on interest 00:16:48.282 --> 00:16:50.182 to pay out those benefits in the 00:16:50.517 --> 00:16:53.947 louie: Yeah, and just and so just talking about that now just the shortfall because 00:16:53.947 --> 00:16:57.457 that's the that's the fear mongering as John mentioned that we always Hear 00:16:57.457 --> 00:16:58.817 we'll just address that real quick 00:16:59.252 --> 00:17:01.902 The one of the reasons we believe that it'll be there in some form 00:17:02.362 --> 00:17:06.732 when we all retire is because when that shortfall hits, and I think the 00:17:06.732 --> 00:17:10.512 latest projection is like 2035, it doesn't mean that there's 0 in there. 00:17:10.522 --> 00:17:15.152 It doesn't mean that they, that they pay the last checkout and the tank 00:17:15.152 --> 00:17:16.422 is empty and there's nothing in. 00:17:16.422 --> 00:17:18.412 So they shut off the lights and say, okay, everyone, like 00:17:18.452 --> 00:17:19.732 no, no one else gets anything. 00:17:20.002 --> 00:17:23.382 There's still revenues coming in every month from everyone paying payroll taxes. 00:17:23.622 --> 00:17:26.842 So there still will be money that comes in to meet obligations. 00:17:26.852 --> 00:17:29.042 They just can't meet obligations at all. 00:17:29.242 --> 00:17:31.852 at the projected levels after 2035. 00:17:32.122 --> 00:17:35.672 So what would happen is they would probably do a reduction to like 00:17:35.672 --> 00:17:39.752 somewhere between 75 and 85 percent of what people were normally getting. 00:17:40.222 --> 00:17:43.727 And that's assuming that Congress doesn't, pull their head out of their 00:17:43.727 --> 00:17:48.047 ass and make some important decisions to fund Social Security, which, like 00:17:48.047 --> 00:17:49.917 we just mentioned, we think they will. 00:17:50.127 --> 00:17:54.067 There's a huge tax base that are collecting Social Security that 00:17:54.067 --> 00:17:56.717 they're not going to risk alienating or driving to the other party. 00:17:56.927 --> 00:17:58.297 Something will likely be done. 00:17:59.087 --> 00:18:03.707 And even if it's not reduced benefits will be there or benefits at a later date. 00:18:03.717 --> 00:18:06.667 Maybe you raise The age from 62 years old to 65 years old, 00:18:07.187 --> 00:18:08.607 something will happen to fix it. 00:18:08.667 --> 00:18:09.647 We think it'll be there. 00:18:10.167 --> 00:18:11.347 Some decisions will be made. 00:18:11.347 --> 00:18:16.227 They'll have to be made in order to fix the shortfall or to reduce benefits. 00:18:16.632 --> 00:18:17.592 But it will happen. 00:18:17.632 --> 00:18:20.632 Jon: Yeah, and there's a lot of if you do some research on there There's 00:18:20.632 --> 00:18:24.052 a lot of commentary about what they feel like congress is going to do to 00:18:24.052 --> 00:18:28.902 try to help rectify or remedy this situation and it's funny just Even making 00:18:28.902 --> 00:18:32.822 some small incremental changes would really move the needle on this as far 00:18:32.822 --> 00:18:37.442 as the sustainability Moving forward so we talked about how much you pay 00:18:37.442 --> 00:18:42.592 into social security so even changing that So if we put if you pay in 6. 00:18:42.592 --> 00:18:46.172 2 percent of your salary You Even if they up that to like 6. 00:18:46.172 --> 00:18:46.382 5 or 6. 00:18:46.382 --> 00:18:50.682 6, so small incremental changes, but you do that for everyone, you're talking 00:18:50.682 --> 00:18:52.442 about a lot of revenue coming in. 00:18:52.442 --> 00:18:56.762 So I think there's going to be a mixture somewhere between that, somewhere between 00:18:56.762 --> 00:19:00.432 maybe increasing the eligibility age in which you can start claiming social 00:19:00.432 --> 00:19:04.567 security, raising that threshold for how much they're going to, how much 00:19:04.567 --> 00:19:07.427 Income you're going to have before they stop taking out social security. 00:19:07.627 --> 00:19:10.197 There's a lot of different things that they can do to to 00:19:10.197 --> 00:19:11.747 help make that more sustainable. 00:19:11.747 --> 00:19:15.247 message loud and clear, at least from Louise and I opinion is 00:19:15.247 --> 00:19:18.187 that social security in some form or fashion will be there. 00:19:18.417 --> 00:19:21.457 So we want our, our members to start thinking about that when they're thinking 00:19:21.467 --> 00:19:25.887 about social security and, and building that into some of their plans as they 00:19:25.887 --> 00:19:28.417 get ready to retire, when they're going to claim it and stuff like that. 00:19:28.562 --> 00:19:31.832 So maybe we should talk about now would be a good time to talk 00:19:31.842 --> 00:19:35.952 about who qualifies or how Do you actually qualify for social security? 00:19:35.952 --> 00:19:38.322 Is it just being a citizen that gets you credits? 00:19:38.322 --> 00:19:40.452 Like how does that how does that whole fiasco 00:19:40.472 --> 00:19:43.482 louie: Or depending on who you believe, it's anyone gets social security, even if 00:19:43.482 --> 00:19:45.752 they're, a migrant or something like that. 00:19:45.772 --> 00:19:47.672 There's a lot of different myths about that. 00:19:47.672 --> 00:19:48.592 So we'll talk about it real quick. 00:19:48.592 --> 00:19:52.312 I know we briefly discussed this in the last podcast, so we'll do 00:19:52.312 --> 00:19:55.232 a brief overview again, because if you're listening to this, You might 00:19:55.232 --> 00:19:58.902 be going, Hey, how do I know if I get social security or am I eligible? 00:19:58.902 --> 00:20:00.742 Or how do I know if I have credits? 00:20:00.742 --> 00:20:02.332 Everyone talks about these credits. 00:20:02.362 --> 00:20:03.872 So we'll just break that down for you real quick. 00:20:03.892 --> 00:20:07.162 There's basically two ways to qualify to get social security. 00:20:07.192 --> 00:20:08.692 Number one is on your own. 00:20:08.952 --> 00:20:11.282 And in order to qualify on your own to get social security, 00:20:11.292 --> 00:20:12.852 you have to have 40 credits. 00:20:13.322 --> 00:20:13.672 So that 00:20:13.697 --> 00:20:14.857 Jon: Just like college credits? 00:20:14.952 --> 00:20:15.752 louie: college credits. 00:20:15.752 --> 00:20:15.912 Yeah. 00:20:15.912 --> 00:20:16.742 How do I get these credits? 00:20:16.742 --> 00:20:17.672 How do I earn these credits? 00:20:17.702 --> 00:20:20.852 Well, it's basically two ways their quarterly credits that you get. 00:20:21.312 --> 00:20:27.002 So 10 years of paying into social security would get you those 40 credits. 00:20:27.102 --> 00:20:32.462 You basically earn one credit for each 1, 730 earned. 00:20:32.852 --> 00:20:37.712 So basically if you, Made more than 7, 000 over the course of a year. 00:20:37.712 --> 00:20:40.932 And you paid social security tax on that 7, 000. 00:20:41.272 --> 00:20:43.052 You would earn four credits that year. 00:20:43.052 --> 00:20:44.342 You can earn more than four credits. 00:20:44.342 --> 00:20:49.742 Doesn't matter if you pay in 60, if you make 000, you're only going 00:20:49.742 --> 00:20:52.182 to earn four credits for that year. 00:20:52.572 --> 00:20:55.742 So basically if you have 10 years of social, of paying into social 00:20:55.742 --> 00:21:00.202 security, you would have 40 credits and that would qualify you to 00:21:00.202 --> 00:21:03.532 receive a social security Benefit, 00:21:03.592 --> 00:21:04.182 Jon: Well said. 00:21:04.192 --> 00:21:05.322 And that's one of those things. 00:21:05.462 --> 00:21:07.572 So it's inflation adjusted every year. 00:21:07.842 --> 00:21:11.332 So every year that, that threshold for each one of those credits that Louie 00:21:11.332 --> 00:21:16.152 was talking about, so that once 1, 730, I think that was from last year. 00:21:16.162 --> 00:21:17.502 I think that was 2024. 00:21:17.662 --> 00:21:20.612 So every year moving forward, that, that goalpost is going to move a little 00:21:20.612 --> 00:21:24.402 bit more, like I think this year it's like 1, 800 or something like that. 00:21:24.402 --> 00:21:25.192 So it'll move up 00:21:25.402 --> 00:21:29.362 louie: It's it's still pretty low and the truth is there are a ton of firefighters 00:21:29.392 --> 00:21:33.632 that have side gigs side hustles And they are earning over seven thousand dollars 00:21:33.632 --> 00:21:36.292 a year over ten thousand dollars a year and they're paying social security You 00:21:36.482 --> 00:21:38.002 Probably both sides of social security. 00:21:38.502 --> 00:21:40.832 And so they are earning credits that way. 00:21:40.852 --> 00:21:43.332 So just because you're a firefighter, if you have a side gig, that doesn't 00:21:43.332 --> 00:21:46.162 mean that you're not going to get social security, you probably have paid into 00:21:46.162 --> 00:21:48.002 your paid and earned your credits. 00:21:48.042 --> 00:21:50.492 And you're, you're probably able to qualify on your own. 00:21:50.557 --> 00:21:52.617 Jon: 100 percent and that's one of those things. 00:21:52.657 --> 00:21:57.997 The best source for information on this in the resource that hopefully every listener 00:21:58.007 --> 00:22:00.677 has is their social security login. 00:22:01.007 --> 00:22:04.967 So you can actually log into the social security administration ssa. 00:22:05.567 --> 00:22:06.057 gov. 00:22:06.337 --> 00:22:09.407 And if you haven't set an up account, You should definitely set up account 00:22:09.657 --> 00:22:14.807 because that is basically what they're using to, to notify you, or to basically 00:22:14.807 --> 00:22:18.017 give you an estimate on what they feel like your benefit is going to be. 00:22:18.017 --> 00:22:21.107 So if any of that information is inaccurate, there's actually ways 00:22:21.107 --> 00:22:23.957 that you can contact them and make, make sure that that gets solved, 00:22:23.987 --> 00:22:26.807 but you want to make sure that that is as up to date as accurate. 00:22:27.007 --> 00:22:30.347 So as you get closer to retirement, those projections will be much 00:22:30.357 --> 00:22:34.627 more accurate because when you're 30 or 40 years out, they are not 00:22:34.742 --> 00:22:34.972 louie: bad. 00:22:35.002 --> 00:22:37.002 Yeah, it's just it's a shot in the dark 00:22:37.127 --> 00:22:39.347 Jon: you know how they actually make those projections? 00:22:39.357 --> 00:22:42.237 So if you, let's say you've only got, let's say you're brand new out 00:22:42.237 --> 00:22:45.657 of college, you started having a corporate job or a job that you're 00:22:45.657 --> 00:22:48.357 paying into social security, you've had this job for like four years. 00:22:48.707 --> 00:22:51.217 And then you log into the social security administration 00:22:51.217 --> 00:22:52.397 and they say like, Oh, cool. 00:22:52.667 --> 00:22:56.022 In 40 years, Louie, you're going to be expected to get this benefit. 00:22:56.022 --> 00:22:56.457 Do you know how 00:22:56.492 --> 00:22:57.202 louie: No idea. 00:22:57.327 --> 00:22:59.427 Jon: Yeah, so it's it's one of those things. 00:22:59.617 --> 00:23:03.947 It's basically just an assumption and they take your previous couple years 00:23:03.947 --> 00:23:07.767 worth of Salary and they project that that's going to increase at a certain 00:23:07.767 --> 00:23:13.277 rate up until you basically retire at 60 or 65 So the ways that social 00:23:13.277 --> 00:23:19.787 security gets calculated is they take The 35 years of your highest salaries. 00:23:19.917 --> 00:23:22.647 So 35 years worth is what they account. 00:23:22.647 --> 00:23:26.757 So one thing that kind of hurts us not paying into social security is 00:23:27.037 --> 00:23:31.437 if you, let's say you've only got 15 years or 20 years worth of, of 00:23:31.667 --> 00:23:35.497 paying into social security, those other 15 years counts as zeros. 00:23:35.937 --> 00:23:38.047 So that's how they calculate all that information. 00:23:38.047 --> 00:23:40.727 So obviously you're going to have a lower benefit cause you're not going to have 00:23:41.107 --> 00:23:43.647 35 years worth of work, so to speak. 00:23:43.697 --> 00:23:46.357 That's basically how they end up calculating what your monthly 00:23:46.367 --> 00:23:50.657 benefit or your primary insurance amount is going to be is off of 35 00:23:50.662 --> 00:23:51.102 louie: years. 00:23:51.302 --> 00:23:51.592 Yeah 00:23:51.637 --> 00:23:54.237 Jon: paying into social security, but that's how those projections work. 00:23:54.237 --> 00:23:58.927 So I always tell people, I caution them, if they're, 28 years old and let's 00:23:58.927 --> 00:24:00.377 say they just got picked up with us. 00:24:01.032 --> 00:24:03.912 And they had five or six years, I mean, maybe making some pretty 00:24:03.912 --> 00:24:05.812 decent money in the private sector. 00:24:06.072 --> 00:24:08.752 And then they come in there like, Oh man, it's projecting that I'm going to have 00:24:08.842 --> 00:24:11.572 3, 500 when I retire at social security. 00:24:12.032 --> 00:24:13.312 That's not going to be the case. 00:24:13.342 --> 00:24:16.602 No, because they are just assuming they don't know that you're now 00:24:16.602 --> 00:24:20.422 in a non covered job that you're not paying into social security. 00:24:20.422 --> 00:24:22.932 So they, the projections are not accurate. 00:24:23.212 --> 00:24:26.562 Now if you're 62 and you're getting those projections about what 00:24:26.562 --> 00:24:27.722 your social security benefit is. 00:24:28.072 --> 00:24:30.802 They're going to be very accurate, much accurate, much more accurate. 00:24:30.802 --> 00:24:34.982 So just take that as a grain of salt when you're talking about that in your future. 00:24:35.002 --> 00:24:38.712 And if you're working with a planner, advisor, everything else, hopefully they 00:24:38.712 --> 00:24:41.392 should, they should recognize that as well when they're running projections 00:24:41.392 --> 00:24:45.392 for you and understanding that right now, working for the fire department that 00:24:45.392 --> 00:24:46.812 you're not paying into social security. 00:24:46.812 --> 00:24:48.112 So just how all that stuff is 00:24:48.114 --> 00:24:49.259 louie: all that stuff is. 00:24:49.259 --> 00:24:49.545 Yeah. 00:24:49.545 --> 00:24:49.831 Okay. 00:24:49.831 --> 00:24:50.937 So the two ways to qualify. 00:24:50.937 --> 00:24:52.057 We talked about on your own. 00:24:52.147 --> 00:24:53.737 And then the second way to qualify. 00:24:53.777 --> 00:24:56.987 And I really like this way is on your spouse's record. 00:24:57.977 --> 00:25:02.047 So If you have a spouse who has earned their 40 credits they have, let's 00:25:02.047 --> 00:25:04.477 say they have a job and they've been paying in social security their whole 00:25:04.477 --> 00:25:08.677 life, or at least for 10 years, they will qualify for social security. 00:25:08.747 --> 00:25:12.077 And as part of that, if you don't have your credits, but you have 00:25:12.077 --> 00:25:16.787 been married, you can qualify for a portion of their social security. 00:25:16.867 --> 00:25:17.477 benefits. 00:25:17.927 --> 00:25:19.687 It's not like you get the same check that they do. 00:25:19.687 --> 00:25:23.667 In fact, it's 50 percent of their benefit, but you do get to qualify for that. 00:25:23.677 --> 00:25:25.037 If you don't have your 40 credits. 00:25:25.137 --> 00:25:28.007 The reason why I like this one is because I don't have 40 credits. 00:25:28.367 --> 00:25:32.197 A little fun fact about me before I was a firefighter. 00:25:32.227 --> 00:25:33.677 I worked for another job. 00:25:33.737 --> 00:25:37.497 This one was with a state department that did not pay into social security. 00:25:37.527 --> 00:25:40.867 So I, I've been free loading for decades. 00:25:41.177 --> 00:25:43.807 the only time I paid into social security was when I was. 00:25:43.967 --> 00:25:48.437 When I had a small job outside of before I graduated from college. 00:25:48.437 --> 00:25:52.117 So my work study job I worked at a pizza place when I was in high school. 00:25:52.337 --> 00:25:55.797 I paid into social security then, but by no means do I have 40 credits. 00:25:55.797 --> 00:25:59.987 In fact, I think I have about 26, 28 credits, somewhere around there. 00:26:00.407 --> 00:26:02.757 And so I haven't paid in enough. 00:26:02.807 --> 00:26:05.087 And right now, if I were to retire, I would not. 00:26:05.572 --> 00:26:06.492 have Social Security. 00:26:06.602 --> 00:26:09.772 Caitlin, on the other hand, has been paying into Social Security since 00:26:09.787 --> 00:26:11.677 Jon: 2007 00:26:11.692 --> 00:26:16.342 louie: or 2008 and she has been paying in consistently and that 00:26:16.342 --> 00:26:19.602 means that she qualifies for Social Security and that I would qualify 00:26:19.602 --> 00:26:22.462 for a benefit under her credits. 00:26:22.462 --> 00:26:22.990 Yeah, 00:26:23.282 --> 00:26:24.572 Jon: The spousal benefit. 00:26:24.672 --> 00:26:24.982 Yep. 00:26:25.102 --> 00:26:28.822 So that's the two different ways in which potentially, the listeners out 00:26:28.822 --> 00:26:31.982 there, the members out there would would qualify for social security. 00:26:31.982 --> 00:26:34.502 One of the things to think about though is when do you actually, 00:26:34.502 --> 00:26:36.042 so we understand how you qualify. 00:26:36.042 --> 00:26:40.202 So you get these 40 credits you've paid into it for 10 years roughly or 00:26:40.202 --> 00:26:42.677 you get your spousal benefits, but when can you actually start doing it? 00:26:42.767 --> 00:26:43.897 Taking social security. 00:26:43.897 --> 00:26:48.727 When do you become social security eligible so to speak so that basically 00:26:48.727 --> 00:26:54.017 anyone that qualifies for it Especially on their own work record can start 00:26:54.017 --> 00:26:56.287 taking social security at 62. 00:26:56.437 --> 00:27:00.177 So that's the earliest Currently that the law says that you can start 00:27:00.177 --> 00:27:04.277 taking social security But they also have something that's called your 00:27:04.327 --> 00:27:06.932 fr A or your full retirement age. 00:27:07.162 --> 00:27:10.272 And that's when you look at your social security statement, the thing 00:27:10.272 --> 00:27:13.912 that's probably highlighted on the top right hand corner is going to 00:27:13.912 --> 00:27:18.452 be what your benefit would be if you waited until full retirement age. 00:27:18.822 --> 00:27:22.602 And for most people listening to this, if you're born after 1960, 00:27:22.972 --> 00:27:24.572 that's going to be the age of 67. 00:27:24.832 --> 00:27:25.322 So if you're both. 00:27:25.467 --> 00:27:29.467 If you're born before 1960, there's some different cutoffs and your full 00:27:29.467 --> 00:27:32.897 retirement age might be a little bit before 67 But i'm going to say most 00:27:32.897 --> 00:27:36.717 people listening here the full retirement age you think should think of 67 That's 00:27:36.717 --> 00:27:40.147 where your benefit that social security says you should get based on being what 00:27:40.147 --> 00:27:42.127 they consider normal retirement age 00:27:42.437 --> 00:27:45.357 louie: And so that, and that's just to go into that a little bit. 00:27:45.377 --> 00:27:50.562 That's the age where it doesn't, it doesn't, it doesn't pay to put it off. 00:27:50.662 --> 00:27:55.022 62 is when you can take Social Security, but if you decide not to take it at 00:27:55.022 --> 00:27:59.807 62 You will get, you would get more money based off an actual aerial table 00:27:59.957 --> 00:28:02.747 if you took it at 63 or 64 or 65. 00:28:02.747 --> 00:28:05.897 And then of course, 67 is when you get that full retirement 00:28:05.957 --> 00:28:07.607 benefit from Social Security. 00:28:07.612 --> 00:28:07.992 Jon: Yep. 00:28:08.192 --> 00:28:10.382 And that's exactly how you should think of that. 00:28:10.382 --> 00:28:12.902 So every, and it's basically prorated every month. 00:28:12.972 --> 00:28:15.942 So every month that you either wait or you take it early, there's 00:28:15.942 --> 00:28:17.692 going to be a certain percentage. 00:28:17.712 --> 00:28:19.072 And it's a pretty big hit though. 00:28:19.092 --> 00:28:24.762 So the difference between taking social security between 62 and 67, 00:28:24.822 --> 00:28:29.002 it's about a 30 percent haircut over what your normal benefit would be. 00:28:29.002 --> 00:28:32.212 So once again, when you read your statement and it says your benefits going 00:28:32.212 --> 00:28:37.267 to be 2, Well, then you can just envision if you take it at 62, just take that, 00:28:37.297 --> 00:28:41.227 just take 30 percent off of that, and that's what your benefit would be at 62. 00:28:41.387 --> 00:28:46.257 louie: John, I know that you are a CFP and you're, you're a resident CFP. 00:28:46.297 --> 00:28:49.097 And I'm going to challenge you here for a second. 00:28:49.097 --> 00:28:53.297 I, I don't want you to say it depends, or I got to know the circumstances. 00:28:53.297 --> 00:28:54.397 I'm just going to throw something. 00:28:54.397 --> 00:28:55.837 I want your gut reaction. 00:28:56.327 --> 00:28:59.327 If you have a retiree coming to you at 62 years old and he says, should I 00:28:59.357 --> 00:29:04.207 take social security now, or should I try to defer and wait until I am 67? 00:29:04.337 --> 00:29:06.207 What does your gut tell you to do? 00:29:06.429 --> 00:29:10.657 Jon: My gut tells me to wait until you're 67. 00:29:10.717 --> 00:29:14.827 And, and the reason for that is, so once again, because of our defined 00:29:14.837 --> 00:29:18.467 benefit, the majority of our members listening to this are in, you already 00:29:18.477 --> 00:29:20.687 have your pension coming in, you're going to have income coming in. 00:29:20.687 --> 00:29:24.087 So you don't need additional, you might want some additional income, 00:29:24.087 --> 00:29:24.997 but you're not going to need it. 00:29:25.097 --> 00:29:29.227 Like most people after 25 or 30 years of service, they're going to have 00:29:29.227 --> 00:29:33.037 their base benefit of 60 to 70 percent of what they were making that should 00:29:33.037 --> 00:29:34.937 cover most of their needs, right? 00:29:34.947 --> 00:29:35.787 Truly their needs. 00:29:35.787 --> 00:29:38.477 They're not going to be, they're not going to need that additional money. 00:29:38.477 --> 00:29:41.847 So I would, I would err on the side of letting that accrue. 00:29:42.612 --> 00:29:46.242 And one of the things that's really nice about Social Security, and it's a great 00:29:46.242 --> 00:29:50.892 benefit, is it's one of the few that has cost of living adjustments built in. 00:29:51.137 --> 00:29:51.867 louie: pretty good cost 00:29:51.942 --> 00:29:55.162 Jon: Really good cost of living adjustments, unlike our pension 00:29:55.162 --> 00:29:59.982 currently that does not really have any form, I mean has minor cost of living 00:30:00.307 --> 00:30:02.597 louie: which we'll talk about in an upcoming episode pretty soon, 00:30:02.602 --> 00:30:06.652 Jon: but it's not it's not as robust as the social security during the 00:30:06.652 --> 00:30:11.862 inflation of 2022 and 2023 I I want to say the top it peaked out It's like 00:30:11.862 --> 00:30:15.022 a cost of living adjustment of eight and a half percent Which is one of the 00:30:15.022 --> 00:30:16.642 highest it's been in like 40 years. 00:30:16.922 --> 00:30:21.002 So it's pretty nice to have that guaranteed So to speak cost of living 00:30:21.002 --> 00:30:24.742 adjustment based on what the consumer price index is So yeah, if you were 00:30:24.742 --> 00:30:26.612 half if you were half If you were to put a gun to my head and say, Hey, like 00:30:26.612 --> 00:30:30.342 you got to just make a decision without any other circumstances, I would say 00:30:30.402 --> 00:30:32.762 to defer and wait until you're 67. 00:30:32.967 --> 00:30:36.727 louie: that's my reaction too, is, and once again, I, I know the easy 00:30:36.727 --> 00:30:38.787 thing for us to say, and you guys probably roll your eyes and we say 00:30:38.787 --> 00:30:42.057 it as it really depends on it in the individual and their circumstances. 00:30:42.477 --> 00:30:45.157 And we can't tell you what's necessarily best for each person 00:30:45.157 --> 00:30:46.967 that's about to retire, but my. 00:30:47.197 --> 00:30:47.957 gut inclination. 00:30:47.957 --> 00:30:51.237 Probably what I will do when I'm there is I'll defer and my wife will 00:30:51.237 --> 00:30:53.237 defer and we'll wait until we're 67. 00:30:53.627 --> 00:30:56.527 Just because first of all, hopefully we're comfortable enough 00:30:56.527 --> 00:30:57.897 at that point that we can wait. 00:30:58.177 --> 00:31:01.867 And it's just like you said, it's good to get that pumped up as much as 00:31:01.867 --> 00:31:05.627 possible so that when you get those cost of living adjustments, they're at 00:31:05.627 --> 00:31:08.287 the highest amount as you qualify for. 00:31:08.327 --> 00:31:10.637 Jon: Yeah, and it's one of those things that's important to note. 00:31:10.677 --> 00:31:13.227 It's a irrevocable decision. 00:31:13.567 --> 00:31:18.547 So if you take social security, as soon as you're eligible at 62, and then six 00:31:18.547 --> 00:31:21.967 months down the line, you meet with an advisor or a plan or something else, 00:31:21.967 --> 00:31:24.947 and you put in your financial and you've already started drawing on that. 00:31:25.012 --> 00:31:25.962 There's no, there's no 00:31:26.087 --> 00:31:26.517 louie: going back. 00:31:26.932 --> 00:31:29.812 Jon: You can't be like, Oh, actually I'll, I'll give that money back. 00:31:29.822 --> 00:31:33.302 And I want to wait until I'm 67 or whatever. 00:31:33.372 --> 00:31:34.142 You can't do that. 00:31:34.142 --> 00:31:38.182 So once it's a pretty big decision from that aspect, once you, once you sign or 00:31:38.182 --> 00:31:40.202 make that election, there's no going back. 00:31:40.202 --> 00:31:41.932 So it's something you should do thoughtfully. 00:31:42.257 --> 00:31:45.377 With a plan in place and really having an idea about what you're going to 00:31:45.377 --> 00:31:49.787 do moving forward in your financial future to, to set you up for success. 00:31:50.077 --> 00:31:52.717 So one thing to think about as well, and it's similar. 00:31:52.857 --> 00:31:56.597 I do like the parallels between this and our pension plan, because 00:31:56.597 --> 00:31:57.867 there's a lot of similarities. 00:31:58.157 --> 00:32:00.387 So one of the things that you can also do with social 00:32:00.387 --> 00:32:02.792 security is you can actually do. 00:32:02.792 --> 00:32:07.342 Delay social security as far as when you want to take it So as we talked about 00:32:07.342 --> 00:32:12.332 before for most people listening if you're born after 1960 67 is when your 00:32:12.342 --> 00:32:15.562 normal retirement age is going to be that's your normal benefit for social 00:32:15.562 --> 00:32:20.962 security You can elect to delay taking social security all the way up until age 00:32:20.972 --> 00:32:26.112 70 And basically at age 70 is you can't you can't defer it anymore and they're 00:32:26.112 --> 00:32:27.952 just going to start sending you checks 00:32:28.022 --> 00:32:30.542 louie: what happens john when you delay we talked about the full 00:32:30.792 --> 00:32:31.072 Jon: Yep. 00:32:31.172 --> 00:32:35.302 So you get an automatic 8 percent increase every year after. 00:32:35.302 --> 00:32:38.872 So 68, you get another 8 percent at 69, you get another 8%. 00:32:38.872 --> 00:32:40.552 So basically 16 percent more. 00:32:40.572 --> 00:32:43.982 And then you'd max out at a 24 percent additional benefit. 00:32:43.982 --> 00:32:47.372 If you waited all the way to 70 from your base age of 67. 00:32:47.457 --> 00:32:51.597 louie: basically a guaranteed 8% return on your money guaranteed to delay it. 00:32:51.647 --> 00:32:53.907 Jon: Yep, which is pretty significant. 00:32:53.907 --> 00:32:58.567 So a lot of things when you're meeting with a planner advisor, one of the things 00:32:58.567 --> 00:33:02.027 that, they're going to take hopefully your whole picture in totality, but 00:33:02.277 --> 00:33:08.187 one of the advantages of delaying until you're 70 is for the survivor benefit. 00:33:08.187 --> 00:33:10.857 So if you have someone like the high income earner. 00:33:10.917 --> 00:33:15.527 Ideally would wait the longest because when we talked about spousal benefits, 00:33:15.527 --> 00:33:16.987 I don't know if we made this clear. 00:33:16.987 --> 00:33:21.537 So when you get spousal benefits, the max spouse benefit you can get is up to 50 00:33:21.537 --> 00:33:26.147 percent of what that employee or that of what your loved one would have gotten. 00:33:26.147 --> 00:33:28.137 So I'll take my example. 00:33:28.137 --> 00:33:32.837 So my wife, Katie, I think right now, like if we were to run her social security. 00:33:33.077 --> 00:33:35.547 Whatever projection at full retirement age. 00:33:35.547 --> 00:33:40.737 It'd be something like 3, 800, 3, 900, I think is what she's projected to get. 00:33:41.087 --> 00:33:44.687 And the other thing about spousal benefits is you have to wait until 00:33:44.707 --> 00:33:49.237 that person starts collecting social security before you can collect. 00:33:49.247 --> 00:33:52.867 So I'm three years older than my wife, so I'm going to have to wait. 00:33:52.877 --> 00:33:57.777 So I would actually be 70 and my wife would turn 67 before I would be eligible 00:33:57.952 --> 00:33:58.602 louie: is great 00:33:58.817 --> 00:34:00.027 Jon: her spousal benefit. 00:34:00.092 --> 00:34:02.902 louie: in some ways is great though Because now at 70 you have 00:34:02.942 --> 00:34:07.002 that max benefit from a spousal perspective that you can get 00:34:07.307 --> 00:34:08.957 Jon: So yes and no. 00:34:08.967 --> 00:34:11.287 So this is where it gets, this is where it gets confusing. 00:34:11.307 --> 00:34:15.917 And this is why, man, I'm telling you right now, like social security, like 00:34:15.917 --> 00:34:18.397 you should really, when you're, when you're thinking about claiming this 00:34:18.397 --> 00:34:21.427 and everything else, there's definitely people that specialize in this, but 00:34:21.597 --> 00:34:24.337 you really want to make sure you got someone that has an understanding of it. 00:34:24.337 --> 00:34:26.717 So when you claim a spousal benefit. 00:34:26.917 --> 00:34:32.647 The max benefit you can get is based off of their full retirement age and 00:34:32.647 --> 00:34:34.147 not their delayed retirement age. 00:34:34.197 --> 00:34:34.517 So 00:34:34.747 --> 00:34:37.377 louie: so it's their 67 00:34:37.407 --> 00:34:40.847 Jon: So once again, so the max that I could possibly get from my wife 00:34:40.887 --> 00:34:45.737 and the spousal benefit is basically 3, 800 or would be 1, 900 right now. 00:34:45.917 --> 00:34:49.077 I call it half 50 percent of 3, 800 bucks. 00:34:49.247 --> 00:34:52.307 So that's the max you can get is half of theirs. 00:34:52.557 --> 00:34:55.837 So when we talk about survivor benefits though, it can actually 00:34:55.837 --> 00:34:58.177 be 100 percent of their benefit. 00:34:58.177 --> 00:35:02.047 So if my, if my wife waited all the way until she was 70 to start 00:35:02.047 --> 00:35:07.442 claiming, and that now is going to be, call it like 4, 800, 4, 900. 00:35:07.572 --> 00:35:09.442 And God forbid she passes away. 00:35:09.772 --> 00:35:13.542 I would be entitled to claim that 4, 900 a hundred percent. 00:35:13.852 --> 00:35:18.112 Yeah, so there are certain things and if it sounds too good to be true It is they 00:35:18.112 --> 00:35:22.232 never let you double dip so you can't be claiming yours and your spouse's it's 00:35:22.232 --> 00:35:26.850 always a combination a matchup of both so I don't want to I'm not going to get too 00:35:26.850 --> 00:35:29.767 in the weeds about some of this stuff, but I do think it's important, especially 00:35:29.767 --> 00:35:33.937 for those members or those retirees that are closer or thinking about claiming 00:35:33.937 --> 00:35:35.477 Social Security and their spouses. 00:35:35.707 --> 00:35:39.007 They definitely want to think about that as far as when, what the claiming 00:35:39.007 --> 00:35:42.387 strategies are, but definitely buyer beware, make sure you have 00:35:42.387 --> 00:35:45.027 someone that understands Social Security and they can explain it to 00:35:45.027 --> 00:35:46.797 you and run the proper projections. 00:35:47.067 --> 00:35:49.797 Because typically what they'll do is, if you ever meet with 00:35:49.797 --> 00:35:50.447 someone, they'll So, yeah. 00:35:50.617 --> 00:35:53.937 And there's calculators that you can use that will basically say, what's the 00:35:53.967 --> 00:35:56.517 optimum way to maximize social security? 00:35:56.887 --> 00:36:00.317 But the problem with that maximum optimization is it's assuming that you 00:36:00.317 --> 00:36:03.437 know the day you're going to die Like that's how those assumptions are all 00:36:03.437 --> 00:36:07.407 made off They're like well if I start claiming it at 62 Versus if I would 00:36:07.407 --> 00:36:11.497 claim it at 67 or if I delayed all 70 like what's going to be the max benefit? 00:36:11.817 --> 00:36:15.297 It really depends on how long you're going to live because if 00:36:15.297 --> 00:36:19.262 you end up dying prematurely You You know, obviously claiming at 62 00:36:19.262 --> 00:36:20.492 would have been a much better idea. 00:36:20.502 --> 00:36:23.842 You actually would have gotten some more money versus waiting all the way to 70. 00:36:23.842 --> 00:36:26.622 So you can't take everything in a silo like that. 00:36:26.622 --> 00:36:28.852 You really should be building it into your whole plan. 00:36:28.852 --> 00:36:31.962 When you're thinking about all sorts of your different retirement assets 00:36:31.962 --> 00:36:33.092 and how you're going to draw on those. 00:36:33.112 --> 00:36:36.092 But, generally speaking, that's how those calculators work. 00:36:36.092 --> 00:36:38.897 They just, Plug in, what's your benefit going to be at 62? 00:36:38.907 --> 00:36:40.067 What's it at 67? 00:36:40.067 --> 00:36:41.207 And then what's it at 70? 00:36:41.507 --> 00:36:43.477 And then it says like, well, how long are you going to live? 00:36:43.507 --> 00:36:46.787 And it'll basically make a little graph and it'll tell you the intersection 00:36:46.847 --> 00:36:51.627 at what point it makes more sense to wait till full retirement age or delay. 00:36:51.627 --> 00:36:56.427 And for most people, it's somewhere between about 78 and 81, where it 00:36:56.447 --> 00:36:59.542 really makes sense to wait at least a full retirement age and delay. 00:36:59.652 --> 00:37:03.922 And or delay until you're 70 just depending on some different circumstances 00:37:04.047 --> 00:37:04.487 louie: Well said. 00:37:04.947 --> 00:37:05.897 Thanks for that explanation. 00:37:06.012 --> 00:37:07.712 Jon: Yeah, it's it's complicated. 00:37:07.912 --> 00:37:12.822 There's literally books, novels, Textbooks that are all dedicated to this and 00:37:13.132 --> 00:37:18.282 there's very unique Nuance circumstances, even when we're talking about spousal 00:37:18.282 --> 00:37:21.792 benefits, the one thing that we didn't talk about and something that I know 00:37:22.012 --> 00:37:24.602 plagues our membership a lot is divorces. 00:37:24.942 --> 00:37:29.992 And you can actually claim on an ex spouse's social security benefit if 00:37:29.992 --> 00:37:31.542 you're married for at least 10 years. 00:37:31.652 --> 00:37:34.592 So there's a lot of weird little nuances and stuff like that. 00:37:34.592 --> 00:37:38.582 I encourage people to try to educate themselves as much as possible or seek, 00:37:38.762 --> 00:37:42.422 expert consultation, so to speak, when it comes to to all those things because 00:37:42.422 --> 00:37:46.572 there are a lot of weird kind of one offs and nuances and all sorts of different 00:37:46.647 --> 00:37:48.067 louie: And John and I are not experts on it. 00:37:48.557 --> 00:37:50.297 John is more of an expert on it than I am, but 00:37:50.362 --> 00:37:53.172 Jon: I, I, I know enough just to know enough that I'm like, 00:37:53.172 --> 00:37:54.442 man, this is complicated. 00:37:54.482 --> 00:37:57.182 Like there's a lot of different things in there and you really got to think it out. 00:37:57.182 --> 00:37:58.502 So I 00:37:58.532 --> 00:38:01.722 louie: thought, one of the reasons why I chose not to do more reading 00:38:01.722 --> 00:38:05.632 on social security before the, recent history is because I thought 00:38:05.652 --> 00:38:07.412 it's, I might not get anything. 00:38:07.422 --> 00:38:13.272 Like I'm going to give a reduction because of two little provisions called the WEP 00:38:13.412 --> 00:38:17.472 and the GPO, which have been repealed with the social security fairness act. 00:38:17.992 --> 00:38:19.572 John, do you want to give us a little bit of a. 00:38:20.542 --> 00:38:25.012 I have a education on, on that repeal of those two provisions that 00:38:25.542 --> 00:38:27.122 mean a lot for us as firefighters. 00:38:27.332 --> 00:38:28.372 Jon: this is super important. 00:38:28.482 --> 00:38:32.402 So Louie and I just got back and a couple of the other executive board members, we 00:38:32.402 --> 00:38:36.412 got back from New Orleans at the beginning of January and we had a little meeting. 00:38:36.882 --> 00:38:40.032 Leadership conference and one of the huge things that they talked about one 00:38:40.032 --> 00:38:44.282 of the really big wins On the national level and now it's obviously tricking 00:38:44.382 --> 00:38:47.952 trickling down to the membership level Is the the social security fairness 00:38:47.952 --> 00:38:53.272 act which president biden signed into law on january 5th of this year So it's 00:38:53.272 --> 00:38:58.762 super new It just got enacted But really it repealed two different provisions. 00:38:58.772 --> 00:39:03.352 One was the wep the windfall elimination provision which basically gave you 00:39:03.352 --> 00:39:06.472 a penalty for claim social security. 00:39:06.472 --> 00:39:07.942 It will reduce your social security. 00:39:08.252 --> 00:39:12.212 If you had what they call a non covered pension, which is pretty much everyone 00:39:12.212 --> 00:39:14.552 that's listening to this podcast, you're not paying into social security. 00:39:14.552 --> 00:39:16.452 So you got penalized, unfairly. 00:39:16.502 --> 00:39:19.392 And Louie and I talked about a little bit on the last episode about what 00:39:19.402 --> 00:39:21.177 that was and why that was unfair. 00:39:21.177 --> 00:39:22.592 We're not asking for more. 00:39:22.812 --> 00:39:25.472 We're just asking for what was, what was rightfully ours. 00:39:25.752 --> 00:39:30.232 And then the other one was the GPO, which is the government pension Offset which 00:39:30.242 --> 00:39:33.982 really for the most part affects your spousal benefit your ability to claim 00:39:33.982 --> 00:39:39.302 your spouse's so yeah up until three weeks ago most people weren't really too 00:39:39.312 --> 00:39:43.152 jazzed about social security from the fire department standpoint because They 00:39:43.152 --> 00:39:45.372 knew they were going to have a reduced benefit if they're going to have a 00:39:45.372 --> 00:39:49.392 benefit at all And that's really one that man, I want to give a huge shout out. 00:39:49.652 --> 00:39:50.552 I think it's important. 00:39:50.552 --> 00:39:53.682 And one of the things that Louie and I are really trying to do, not only 00:39:53.682 --> 00:39:56.952 with this podcast, but just when we talk to our members is really 00:39:56.952 --> 00:40:01.252 try to educate them more about what the union is, is doing for them. 00:40:01.472 --> 00:40:05.522 behind the scenes and then also front facing as well And this is one that 00:40:05.522 --> 00:40:09.712 like if you think about like, oh my god I've paid union dues for 30 00:40:09.712 --> 00:40:13.262 years and i'm paying whatever one and one and a quarter percent of my 00:40:13.262 --> 00:40:17.902 salary and I I totaled all that stuff up like what am I getting for that? 00:40:18.222 --> 00:40:22.402 Well, i'll tell you right now like if you were in my circumstance Where I would now 00:40:22.412 --> 00:40:27.172 be eligible for the spousal benefit of 1800 a month and i'm going to do that for 00:40:27.212 --> 00:40:29.672 30 years You That more than covered my 00:40:29.702 --> 00:40:30.442 louie: union dues. 00:40:30.492 --> 00:40:31.162 Oh yeah. 00:40:31.232 --> 00:40:36.132 Jon: I mean, this is like, I can't, I can't explain enough what a massive, 00:40:36.132 --> 00:40:41.132 significant financial win this is for our members and how hard they've been 00:40:41.132 --> 00:40:44.712 fighting for it, 40 years, they've been trying to repeal this and I'll tell you 00:40:44.712 --> 00:40:51.162 right now, it was basically the IAFF that got this passed across the finish line. 00:40:51.197 --> 00:40:51.737 louie: Absolutely. 00:40:51.942 --> 00:40:52.712 Jon: bless all the other 00:40:52.817 --> 00:40:54.647 louie: I don't think, I don't think it would've passed 00:40:54.757 --> 00:40:59.267 Jon: would not have passed it would not have passed if it wasn't for our general 00:40:59.267 --> 00:41:03.657 president at Kelly and then all the other DVPs and then all the other members at 00:41:03.657 --> 00:41:07.157 the local level really pushing their congressional members to vote in favor 00:41:07.157 --> 00:41:11.287 for this They had other support right from the teachers and from the police 00:41:11.287 --> 00:41:14.527 officers and all these other folks that are you know, all these other different 00:41:14.537 --> 00:41:17.857 unions But really it was The, it was the 00:41:17.887 --> 00:41:20.737 It was the IAFF that got this across the finish line. 00:41:20.767 --> 00:41:25.357 And this is not to toot our own horns, but this is definitely a, an acknowledgement 00:41:25.357 --> 00:41:29.647 of the amount of work that happened behind the scenes and just how fortunate 00:41:29.647 --> 00:41:33.547 we are and really what a game changer this is gonna be for our members moving 00:41:33.902 --> 00:41:36.292 louie: I mean, I, I've heard a lot of people say that it might've 00:41:36.292 --> 00:41:39.582 been the most significant, at least over the last 30 years, the most 00:41:39.582 --> 00:41:42.942 significant piece of legislation that the IFF helped pass through. 00:41:43.292 --> 00:41:45.642 And it is real dollars to real people. 00:41:45.992 --> 00:41:46.902 I'll give you an example. 00:41:46.902 --> 00:41:47.982 Actually, I'll give you a couple of examples. 00:41:47.982 --> 00:41:50.972 One example is there's a firefighter that we work with who's about to 00:41:50.972 --> 00:41:52.512 retire, getting close to retiring. 00:41:52.522 --> 00:42:00.632 And he is going to see between he and his spouse, 800 extra per month because of 00:42:00.672 --> 00:42:03.502 these, the repeal of the weapon, the GPO. 00:42:03.762 --> 00:42:05.052 He's had side gigs. 00:42:05.052 --> 00:42:08.957 He's worked, before the fire department in other career fields, and he has been built 00:42:08.967 --> 00:42:13.607 up his credits and he was going to be penalized because he's a firefighter now. 00:42:13.637 --> 00:42:15.717 And now, boom, he doesn't have to worry about that. 00:42:15.717 --> 00:42:19.947 He's going to get 800 a month extra in social security benefits than he 00:42:19.947 --> 00:42:21.827 would if this legislation didn't pass. 00:42:21.917 --> 00:42:22.587 That is huge. 00:42:22.842 --> 00:42:24.252 Jon: That is absolutely huge. 00:42:24.317 --> 00:42:25.297 louie: that's not, he's not the only one. 00:42:25.297 --> 00:42:27.507 There's a lot of people like that that are now eligible. 00:42:27.507 --> 00:42:30.907 There's a lot of recent retirees and just retirees in general that are eligible too. 00:42:31.077 --> 00:42:33.807 And here's something crazy about that, about this whole situation. 00:42:33.807 --> 00:42:34.942 That's just, Awesome. 00:42:35.292 --> 00:42:37.962 Even my own mother is going to benefit from this. 00:42:37.972 --> 00:42:42.942 She worked early in her life as a Safeway clerk and then a 00:42:42.962 --> 00:42:44.352 manager, department manager. 00:42:44.642 --> 00:42:46.862 So she worked for Safeway UFCW local seven. 00:42:46.862 --> 00:42:50.702 She was a union member as well, but she paid social security for years. 00:42:50.722 --> 00:42:53.892 And then when she took a job with the state, she was going 00:42:53.892 --> 00:42:55.322 to get her social security. 00:42:55.517 --> 00:43:00.057 Docked because of that, even though she paid in faithfully for 25 years 00:43:00.427 --> 00:43:03.397 and now she's gonna get an extra benefit that she normally would not 00:43:03.397 --> 00:43:06.427 get, and that will be hundreds of dollars a month for her as well. 00:43:06.517 --> 00:43:07.237 I mean, that's awesome. 00:43:07.237 --> 00:43:10.477 That's, and for someone who's, has never earned a ton, that is gonna 00:43:10.477 --> 00:43:12.427 be a huge difference maker for her. 00:43:12.487 --> 00:43:16.117 So it, it's just a, it was a great thing that, that the IFF helped push through. 00:43:16.222 --> 00:43:19.982 Jon: Yeah, I would say conservatively, if you were to ask, generally speaking, 00:43:19.982 --> 00:43:23.112 the range for our members, like what this is going to mean for them. 00:43:23.232 --> 00:43:26.752 And I'm going to say it's probably going to be somewhere between an additional 500 00:43:27.092 --> 00:43:32.062 to 1, 500, depending on where you fall on this, on this whole thing of additional 00:43:32.062 --> 00:43:33.462 money you're going to get every month. 00:43:33.617 --> 00:43:36.487 Because of this thing getting repealed, which is just, I mean, 00:43:36.487 --> 00:43:38.327 it's a game changer for some people. 00:43:38.327 --> 00:43:41.797 It can be the difference of, retiring a year or two earlier, or it can be 00:43:41.797 --> 00:43:44.807 the difference of a lot of different things that they can use that money for. 00:43:44.807 --> 00:43:48.377 So I'm just really proud to represent the union. 00:43:48.427 --> 00:43:50.527 I know Louie and I are both very proud of what we, not only 00:43:50.527 --> 00:43:51.657 what we do here locally, I, 00:43:51.832 --> 00:43:52.572 louie: We're very proud 00:43:52.897 --> 00:43:56.677 Jon: But on the state level and then also on the national level 00:43:56.697 --> 00:43:58.407 just it's it's really cool to see. 00:43:58.407 --> 00:44:00.597 And I'll be honest, man, I'm very optimistic. 00:44:00.597 --> 00:44:05.147 I'm a more than a half glass is full kind of guy for those of you that know me. 00:44:05.337 --> 00:44:07.485 But But man, when they were talking about getting this three, I was 00:44:07.495 --> 00:44:09.125 like, dude, this is a lot of money. 00:44:09.455 --> 00:44:12.585 They're talking about this costing 200 billion over 10 years. 00:44:12.585 --> 00:44:15.165 And we can see right now what the government's trying to do as 00:44:15.165 --> 00:44:17.885 far as, tightening the belt and on all sorts of other things. 00:44:17.885 --> 00:44:22.685 So the fact that this passed with such bipartisan support, really big shout out 00:44:22.685 --> 00:44:26.245 to all the legislators, all the lobbyists, everyone working behind the scenes to 00:44:26.245 --> 00:44:27.815 get this approved for our membership. 00:44:28.165 --> 00:44:29.305 It's it's a big deal. 00:44:30.145 --> 00:44:32.485 So really wanted to, really wanted to highlight that. 00:44:32.485 --> 00:44:34.565 So I did get stopped the other day. 00:44:35.305 --> 00:44:37.915 And one of the retirees was asking me they're like, okay, cool. 00:44:37.915 --> 00:44:38.575 This is great. 00:44:38.815 --> 00:44:42.025 This all got passed When are we going to actually start seeing 00:44:42.025 --> 00:44:43.575 our additional money come through? 00:44:44.185 --> 00:44:45.615 And that's one of those things. 00:44:45.615 --> 00:44:48.895 Yeah, so just like anything else that happens in congress They can write 00:44:48.895 --> 00:44:51.905 great legislation or poor legislation However, you want to look at it, but 00:44:51.915 --> 00:44:56.075 how it gets enacted and then implemented are two different things So if you go 00:44:56.075 --> 00:44:59.715 onto the social security website right now There's a there's a quick link that 00:44:59.715 --> 00:45:03.255 talks about some of the frequently asked questions regarding this And basically 00:45:03.255 --> 00:45:07.470 they just said We don't know when this is going to start, when are basically 00:45:07.750 --> 00:45:11.190 when people that are collecting social security and start to see this additional 00:45:11.190 --> 00:45:13.840 benefit, it does ask for some grace. 00:45:13.840 --> 00:45:17.070 And I think there is some verbiage that says like up to a year 00:45:17.370 --> 00:45:18.800 to get this thing implemented. 00:45:19.070 --> 00:45:22.490 I do know the way the legislation was passed is that they are going 00:45:22.490 --> 00:45:26.910 to retroactively go back to January 1st of 2024 for your payments. 00:45:27.160 --> 00:45:32.490 So at some point in the future, if you are already collecting social security. 00:45:32.800 --> 00:45:36.370 And you fell under one of these provisions, the WEP or the GPO, 00:45:36.660 --> 00:45:37.930 you don't have to do anything. 00:45:37.940 --> 00:45:39.340 They already have it in their system. 00:45:39.340 --> 00:45:43.320 There's a formula that they know that it's reducing your benefit that will 00:45:43.320 --> 00:45:46.320 all of a sudden basically turn off and you'll get your full benefit, 00:45:46.320 --> 00:45:50.470 but you also will get a lump sum payment, basically backdating a year. 00:45:50.470 --> 00:45:52.915 So once again, for some of our folks. 00:45:53.045 --> 00:45:56.845 The max you could possibly get under the WEP would be a lump 00:45:56.845 --> 00:45:58.925 sum of a little over 7, 000. 00:45:59.205 --> 00:46:03.435 So it could be a big chunk of change in the future, but it's still a TBD to 00:46:03.435 --> 00:46:06.665 be determined as far as when they're actually going to be implemented. 00:46:06.905 --> 00:46:10.175 And then if you haven't claimed your benefits yet there will be an 00:46:10.175 --> 00:46:13.015 opportunity when you do get ready to claim your benefits that this 00:46:13.015 --> 00:46:16.015 will no longer be an issue and you should just get your full payment. 00:46:16.015 --> 00:46:18.915 So it's really those that are already claiming their benefits that 00:46:18.915 --> 00:46:22.595 there's going to be a little Lag time and getting caught up and social 00:46:22.595 --> 00:46:26.015 security is already underfunded for, their, their what they need to do. 00:46:26.015 --> 00:46:29.805 And it's 67 million people collect some type of retirement benefit every year. 00:46:29.805 --> 00:46:31.315 So it's a big, it's a big program. 00:46:31.315 --> 00:46:34.265 So this is going to take a little bit to get it sorted out, but I'm 00:46:34.265 --> 00:46:37.975 confident that it will get sorted out that the members will get 00:46:37.985 --> 00:46:39.765 their money that was owed to them. 00:46:40.075 --> 00:46:41.455 And it's going to be a huge win. 00:46:41.455 --> 00:46:42.815 Just really excited about it. 00:46:42.955 --> 00:46:43.995 Yeah, pretty darn cool. 00:46:43.995 --> 00:46:45.735 So that's that's a lot. 00:46:45.735 --> 00:46:49.625 like I said, a dry episode but hopefully, there's some optimism with this. 00:46:49.665 --> 00:46:53.865 Hopefully this is, it's going to just help people be a little bit more financially 00:46:53.865 --> 00:46:55.845 secure than they would have been before. 00:46:55.845 --> 00:46:59.105 This is something that a lot of us have been paying into and, and now you get 00:46:59.105 --> 00:47:00.745 your fair share of what was earned to you. 00:47:00.745 --> 00:47:03.415 We just wanted to give you guys a little bit of insight or just a little bit 00:47:03.415 --> 00:47:07.565 more About social security and really try to dispel some of the thoughts 00:47:07.565 --> 00:47:09.305 of, not counting on this at all. 00:47:09.405 --> 00:47:10.315 I don't think that's fair. 00:47:10.325 --> 00:47:12.945 I think there's going to be some, some level of this that we're 00:47:13.195 --> 00:47:15.525 all going to be beneficiaries of. 00:47:16.015 --> 00:47:17.715 louie: And yeah, we thank you guys for listening. 00:47:17.765 --> 00:47:18.275 We. 00:47:18.780 --> 00:47:22.920 We have some good plans coming up for, for this year or this season 00:47:22.920 --> 00:47:24.260 of the podcast, if you will. 00:47:24.600 --> 00:47:27.200 We know that there's some big things that, there's a lot of questions about that. 00:47:27.200 --> 00:47:28.150 People want us to answer. 00:47:28.150 --> 00:47:29.250 The pension is a big one. 00:47:29.280 --> 00:47:30.790 Obviously that's like the cornerstone. 00:47:31.150 --> 00:47:34.410 And we've been saving that I think just to get our feet under us and make sure 00:47:34.410 --> 00:47:36.320 that we're good with talking about it. 00:47:36.320 --> 00:47:37.730 And it's a, It's a big deal. 00:47:37.740 --> 00:47:39.600 So we're, we're actually excited to tackle that. 00:47:39.610 --> 00:47:40.660 That'll be coming up soon. 00:47:41.000 --> 00:47:42.740 We're still, taking your guys questions at 00:47:42.780 --> 00:47:43.010 Jon: askfiscalfirehouseatgmail. 00:47:44.960 --> 00:47:45.170 louie: askfiscalfirehouseatgmail. 00:47:45.220 --> 00:47:45.640 com. 00:47:46.170 --> 00:47:48.850 So we're making sure that we address those when they come up. 00:47:48.850 --> 00:47:50.640 We've got a couple of questions already in the queue. 00:47:50.860 --> 00:47:53.440 We'll address those in one of the episodes, but as always, if you guys 00:47:53.440 --> 00:47:56.430 have any feedback or anything that you want us to address, we're happy to look 00:47:56.430 --> 00:47:58.100 into it and try to do that for you guys. 00:47:58.185 --> 00:47:58.325 Jon: Yeah. 00:47:58.455 --> 00:48:01.125 And one of the things Louie and I are pretty passionate about is we try 00:48:01.125 --> 00:48:03.015 to make a lot of this stuff timely. 00:48:03.295 --> 00:48:05.985 So whenever things are hitting in the headlines or whenever things are 00:48:05.985 --> 00:48:08.825 happening here around the organization that we think it's like, Oh, this would 00:48:08.835 --> 00:48:10.445 be a great time to talk about this. 00:48:10.455 --> 00:48:12.515 we're trying to keep that in front of mind. 00:48:12.515 --> 00:48:14.545 tax season's coming up here in the next couple of months. 00:48:14.545 --> 00:48:18.345 So we might do a little bit, with taxes or tax planning and some other stuff coming. 00:48:18.400 --> 00:48:21.850 I just did want to say one really thing out of a good order and welfare. 00:48:22.080 --> 00:48:27.190 I did want to congratulate our own Kevin Reichenbach who is now the president of 00:48:27.190 --> 00:48:28.750 the Colorado professional firefighters. 00:48:28.750 --> 00:48:29.920 So huge shout out to Kevin. 00:48:30.190 --> 00:48:32.840 Man, that guy's been working hard for a long time and it's really 00:48:32.840 --> 00:48:34.140 well deserved and well earned. 00:48:34.140 --> 00:48:35.180 And we're really proud of you, Kev. 00:48:35.710 --> 00:48:38.730 Keep fighting the good fight and keep doing good work at the state level for 00:48:38.800 --> 00:48:39.270 louie: That's awesome. 00:48:39.490 --> 00:48:40.110 Jon: really awesome. 00:48:40.110 --> 00:48:43.380 But without further ado, once again, thanks everyone for listening. 00:48:43.460 --> 00:48:45.090 Be safe out there, Louie, as always. 00:48:45.090 --> 00:48:47.350 Thanks for keeping me honest and making sure that I know my 00:48:47.350 --> 00:48:49.060 presidents and their orders. 00:48:49.080 --> 00:48:52.530 No, Teddy, Theodore, what FDR, all the other ones. 00:48:52.530 --> 00:48:55.470 Yeah, no, it's a, it's a good partnership we have, and I definitely 00:48:55.470 --> 00:48:59.400 appreciate your camaraderie and sharing on this journey with us. 00:48:59.495 --> 00:49:00.355 louie: love doing it with you, buddy. 00:49:00.425 --> 00:49:00.575 Yeah, 00:49:00.640 --> 00:49:01.160 Jon: absolutely. 00:49:01.240 --> 00:49:01.540 All right. 00:49:01.580 --> 00:49:04.560 Until next time everyone stay safe out there and 00:49:04.610 --> 00:49:05.160 louie: Keep saving. 00:49:05.305 --> 00:49:05.485 Jon: Yep. 00:49:05.485 --> 00:49:06.155 Keep saving. 00:49:06.295 --> 00:49:07.215 Just keep saving. 00:49:07.705 --> 00:49:08.085 Take care. 00:49:10.225 --> 00:49:13.625 The Fiscal Firehouse Podcast is a podcast curated specifically 00:49:13.635 --> 00:49:15.345 for local 1309 members. 00:49:15.495 --> 00:49:19.135 This podcast is for informational and educational purposes only, 00:49:19.535 --> 00:49:22.265 and should not be construed as professional financial advice. 00:49:22.475 --> 00:49:25.195 Should you need professional advice, consult a licensed 00:49:25.315 --> 00:49:27.715 financial advisor or tax advisor. 00:49:27.895 --> 00:49:31.745 The opinions of John Beatty, Louie Barela, and their castmates are 00:49:31.745 --> 00:49:35.215 solely their own, and don't reflect that of West Metro Fire Rescue.