You want to retire someplace safe. But here's how you can tell

Columnist Glenn Ruffenach also answer readers' questions on Social Security benefits.

  • By Glenn Ruffenach,
  • The Wall Street Journal
  • Facebook.
  • Twitter.
  • LinkedIn.
  • Print

Q: My husband and I plan to move when we retire, and we want to include safety as a factor in choosing a home and community. Any advice about how to evaluate a destination in terms of safety?

A: Good question. This piece of the relocation puzzle is easy to overlook. Most people, not surprisingly, focus on factors that are, well, more fun: climate, lifestyles, housing, shopping, cultural events. But issues like taxes, health care—and crime—are equally important.

Beyond the obvious—feeling comfortable about walking through a prospective neighborhood at any hour of the day or night—you should check several sets of information, if available: property crime rates, violent crime rates and victimization surveys.

Start with the Federal Bureau of Investigation’s report titled “Crime in the United States.” Here, you’ll find information about violent crime, (murder, rape, robbery and aggravated assault) and property crime (burglary, larceny, motor-vehicle theft and arson) in cities and towns with a population of 100,000 or more and some metropolitan areas. Keep in mind that the statistics include only those crimes that were reported to the FBI by local law-enforcement authorities, but they still provide a good snapshot for large locales.

Next, check with the police and sheriff departments in your target destinations. A growing number of departments are publishing crime statistics, and many of these figures are available online. (A simple search might include the name of the town and the words: police department crime statistics.) Again, it’s difficult to know just how many incidents are actually reported to — or by — local officials. (Does a stolen bicycle make the cut?) Not surprisingly, some towns are reluctant to paint a detailed picture of misdeeds in their neighborhoods.

Several other questions to consider regarding safety: Would you feel comfortable leaving your new home for extended vacations? Is there a neighborhood watch program or a homeowner’s association that makes safety part of its focus? And are there reasonable response times for emergency services?

Q: I am currently receiving Social Security survivor benefits and will turn 70 in late July. I want to switch to my benefit, based on my work record, at that time since it is more money. Do I have to wait until my actual birthday to make sure I will receive my full benefit? The local Social Security office told me I could apply in June, but that doesn’t seem right.

A: This question gives me the chance to highlight something called “retroactive benefits,” an important issue for anyone who elects to claim Social Security after reaching “full retirement age,” as defined by the Social Security Administration. (That figure is rising gradually to age 67 for those born in 1960 or later.) In short, retroactive benefits can get you in trouble, if you don’t understand how the concept works.

Your local Social Security office is correct: You don’t have to wait for your birthday; you can apply now for your new benefit. Indeed, the Social Security Administration typically suggests that people file their application about three months before they want their benefits to begin, says Darren Lutz, a public-affairs specialist with the agency. When applying, you will be asked to pick your “month of entitlement,” the month you want benefits to start.

It is now June, but it is not too late to choose to have your new, work-based benefits begin in July, your birthday month. This will give you the largest payout possible, since Social Security benefits “max out” at age 70. And your first payment will arrive in August. (Social Security benefits typically are paid the month after they are due.)

All of which brings us to retroactive benefits. If you first claim Social Security after reaching full retirement age, the Social Security Administration gives you the option to backdate your application—by as much as six months—and collect a lump-sum payment equal to six months of benefits. (Note: “Retroactivity” is designed primarily to help people who, through error or neglect, failed to apply for a Social Security benefit to which they were entitled. That said, it’s available to most people who first file for benefits after reaching full retirement age.)

But there’s a very big catch.

Let’s say a person is eligible, at a full retirement age of 66, for a monthly benefit of $2,400. And let’s say this person waits until age 66½ to claim Social Security, when the monthly benefit would be almost $2,500. (Remember, the longer you wait to claim benefits, the larger your payout.) At this point, the Social Security Administration will offer the option of backdating this application six months and, if the person accepts, sending this individual a payment for $14,400, or $2,400 x 6 months. Sounds great.

But here’s the catch: The monthly benefit going forward—even though this individual is 66½—will be $2,400, the figure this person would have received at age 66. That amounts to a permanent reduction of about 4% in this individual’s monthly payout.

The point: When you first apply for Social Security, you must understand how the process works—how picking a particular month to begin receiving benefits can affect the size of your payout—and you must tell the Social Security Administration as clearly as possible when you want benefits to start. There are (too many) instances of applicants listening to a Social Security representative talk about retroactive benefits and thinking a check equal to, say, six months of benefits sounds like a good deal—but failing to understand how that decision will reduce their payouts for, say, the next 20 years.

If you apply for benefits online, you should have few problems; the application lays out the available options and you must select one to complete the process. If you’re speaking with a Social Security representative, on the phone or at your local office, he or she normally will give you the same options and should explain how they work.

That said, we have noted before how the Social Security Administration is stretched increasingly thin, and mistakes can happen. So please, be clear, be specific. And if you want retroactive benefits—fine. As long as you understand the consequences.

  • Facebook.
  • Twitter.
  • LinkedIn.
  • Print

For more news you can use to help guide your financial life, visit our Insights page.


Copyright © 2019 Dow Jones & Company, Inc. All Rights Reserved.
Votes are submitted voluntarily by individuals and reflect their own opinion of the article's helpfulness. A percentage value for helpfulness will display once a sufficient number of votes have been submitted.
close
Please enter a valid e-mail address
Please enter a valid e-mail address
Important legal information about the e-mail you will be sending. By using this service, you agree to input your real e-mail address and only send it to people you know. It is a violation of law in some jurisdictions to falsely identify yourself in an e-mail. All information you provide will be used by Fidelity solely for the purpose of sending the e-mail on your behalf.The subject line of the e-mail you send will be "Fidelity.com: "

Your e-mail has been sent.
close

Your e-mail has been sent.