Episode summary
Why Social Security Should Be Part of a Holistic Retirement Income Plan
Summary
Heather Schreiber argues that Social Security should be treated as a core retirement-income planning lever, not a simple break-even math problem. She says fear-based decisions are common because many clients misunderstand what “insolvency” means, how benefits are calculated, and why claiming while still working can still help. Her central point is that advisors can add value by giving clients accurate basics and helping them see Social Security as part of a coordinated retirement plan rather than a standalone choice.
She emphasizes that the system is not “going broke” so long as workers keep contributing, though she notes the trust fund reserves could be tapped and benefits could be reduced around 2033 if no changes are made. She also explains that benefits are based on the highest 35 years of Social Security-taxed earnings, not simply 10 years of work, and that zeros can reduce the calculation if someone has fewer than 35 years.
For couples, Schreiber says claiming decisions should be evaluated through survivor income, lifetime cash flow, taxes, and long-term care risk. Because one spouse will usually outlive the other, and the higher benefit remains for the survivor, she argues advisors need to start these conversations early and connect Social Security with Medicare, tax brackets, and pre-tax assets before retirement begins.
Key takeaways
- Schreiber says advisors should replace fear-driven claiming decisions with accurate education about what Social Security insolvency actually means.
- She says benefits are calculated using the highest 35 years of Social Security-taxed earnings, and missing years can insert zeros that reduce the benefit.
- For couples, she says the higher benefit survives the first spouse’s death, so claiming should be evaluated for survivor income and not just individual break-even math.
- Schreiber says claiming while still working can still help a client, so retirement and benefit timing should not be treated as the same decision.
- She urges advisors to start Social Security planning early and coordinate it with taxes, Medicare, and possible long-term care needs.
Notable quotes
“social security will never go broke because as long as we have workers paying into the system, there's going to be funding, right”
“It's 35 years of earnings. It isn't the last 35. It's your highest 35 years of social security taxed earnings that's brought up by indexing the earnings”
“this is a coordinated income problem right this is what we need to solve holistically you know based upon their unique circumstances”
“when one spouse dies. They don't really have a an answer. Consumers often fail that question and the answer there is the higher benefit remains”
“I would say, are they even having the conversations? because I'm finding that this area of planning is widely not recognized”
How the episode opens
Social Security may be one of the biggest retirement levers, but it's also one of the easiest to get wrong. So, to learn more, I'm joined by Heather Shriber to break it all down. Heather, thanks so much for joining me.
Thank you for having me. — So, let's quell some fears here because like I said, social security is a large retirement lever, but it can be widely misunderstood. So, what are some common mistakes advisors can help clients avoid when deciding when to claim social security?
There are many. How much time do we have? — Plenty.
Yeah. You know, I think that you you brought up a good point. You know, allowing fear to to be the catalyst for a decision.
Uh, you know, obviously we've heard the media reports of, you know, social security is is going broke. You know, I think adviserss can really educate consumers about what that actually means. We've heard this for many years.
You know, Social Security is having funding challenges. And so, I think advisers can really help their clients understand what that means. And certainly, we know that that people rely unfortunately more on social security than they should.
So, yes, it is definitely a planning pillar. In fact, I was just talking about it in my last session, but understanding what insolveny means. you know, social security will never go broke because as long as we have workers paying into the system, there's going to be funding, right?
So, insolveny means, you know, that that the trust fund reserves would basically be tapped into and they are being tapped into now because we have more retirees. We have the baby boomers, right, that are we're paying out more than we're receiving in. And so if it came to pass that there were not changes made in time that right now we're looking at about 2033 when the benefits would have to be reduced if there aren't changes to be made.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- social security claiming strategy
- retirement income planning
- survivor benefits
- tax coordination
- medicare and long-term care planning
Watch the episode
Watch “Why Social Security Should Be Part of a Holistic Retirement Income Plan” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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