I HAVE A QUESTION

The Keys to Unlocking Social Security and Making Your Benefits Work for You

[FINRA Professionals Name] [FINRA Professionals Title] [FINRA Member Firm]

Annuities are issued by Transamerica Life Insurance Company in Cedar Rapids, Iowa and Transamerica Financial Life Insurance Company in Harrison, New York and Transamerica Funds are mutual funds advised by Transamerica Asset Management, Inc. Variable annuities and mutual funds are distributed by Transamerica Capital, Inc. References to Transamerica pertain either individually or collectively to these Transamerica companies. Transamerica Financial Life Insurance Company is licensed in New York. Annuities may lose value and are not insured by the FDIC or any federal government agency. They are not a deposit of or guaranteed by any bank, bank affiliate, or credit union.

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IMPORTANT DISCLOSURE
This material is provided for educational purposes only and does not constitute investment advice. The information contained herein is based on current tax laws, which may change in the future. Transamerica cannot be held responsible for any direct or incidental loss resulting from applying any of the information provided or from any other source mentioned. The information provided does not constitute any legal, tax or accounting advice. Please consult with a qualified professional for this type of advice.

HOW IT STARTED

Social Security Administration, A Brief History of Social Security, August 2000.

WHY ITS IMPORTANT

Social Security is still a major source of income to those 65 or older.

Social Security Administration, "Fast Facts & Figures About Social Security, 2010"

I HAVE A QUESTION
Well address common concerns about: Filing for Social Security Utilizing spousal benefits Taxes and Medicare Youll learn: How to determine your Full Retirement Age Simple strategies to maximize your benefits To better understand the nuances of Social Security

WHEN SHOULD I FILE FOR BENEFITS?

In order to understand when you are eligible to begin benefits, you need to know your Full Retirement Age. Your Full Retirement Age is based on the year you were born*. The younger you are, the older youll have to be to reach it.
AGE TO RECEIVE 100% OF MONTHLY BENEFIT

*If born Jan. 1, the SSA figures your benefit as if you were born the previous year. Social Security Administration, Retirement Planner Retirement Benefits by Year of Birth, 2011," SSA.gov 6

WHEN SHOULD I FILE FOR BENEFITS?

You may elect to receive: Full benefits at Full Retirement Age Reduced benefits as early as the first full month you reach age 62 Increased benefits, if benefits are delayed beyond Full Retirement Age (up to age 70)

Social Security Administration, Retirement Benefits, 2010, SSA.gov

WHEN SHOULD I FILE FOR BENEFITS?

INCREASE FOR DELAYED RETIREMENT

Social Security provides yearly increases for those who delay the start of benefits.
WHAT THIS MEANS FOR MONTHLY BENEFITS

Delaying benefits until age 70* represents a 32% increase in monthly payments.

*If born Jan. 1, the SSA figures your benefit as if you were born the previous year.
Social Security Administration, When to Start Receiving Retirement Benefits, 2008, and Retirement Planner: Delayed Retirement Credits, 2010, SSA.gov 8

WHEN SHOULD I FILE FOR BENEFITS?

Other considerations include: Health Life expectancy Marital status Lifestyle expectations Years in the workforce Other retirement assets

CAN I STILL WORK AND RECEIVE BENEFITS?

Working beyond Full Retirement Age may actually increase your benefits. But, if you elect to begin benefits prior to reaching Full Retirement Age, you must be aware of earnings limits. Surpassing these will result in a reduction of benefits.
UNDERSTANDING THE EARNINGS LIMITS

Social Security Administration, Retirement Benefits 2010, and How Work Affects Your Benefits 2011, SSA.gov

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CAN I ESTIMATE WHAT MY BENEFITS WILL BE?

Your annual Social Security Statement provides an estimate of what your future benefits will be. Avoid potential conflicts later by making sure the information is accurate. Review your statement with your financial professional.

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WHAT IS THE MAXIMUM BENEFIT AVAILABLE?

The maximum monthly Social Security benefit for a worker retiring at age 66 in 2011 is $2,366. However, most retirees do not receive anything close to the maximum benefit, mostly because they begin receiving payments early.

Social Security Administration, Understanding the Benefits, 2011, and Frequently Asked Questions, 2011, SSA.gov

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HOW ARE MY BENEFITS CALCULATED?

In order to be eligible, you must have enough credits. Generally speaking, this translates to 10 years in the workforce for a 62-year-old filing today. Credits only determine eligibility not the amount of payments. Payment amount is based on earnings history calculated using monthly earnings during the 35 years in which you earned the most. You can calculate your benefits yourself by visiting the Social Security Administration website (SSA.gov).

Social Security Administration, Your Retirement Benefit: How It Is Figured , 2010, and Understanding the Benefits, 2011, SSA.gov

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HOW CAN I UTILIZE SPOUSAL BENEFITS?

Rules to keep in mind* You must be age 62 or older to qualify. You cannot collect a spousal benefit until your spouse files for their own benefit. If you file for spousal benefits at Full Retirement Age, spousal benefit will be equal to 50% of your spouses Primary Insurance Amount (PIA). These rules also apply for divorced-spouse benefits, as long as the marriage lasted at least 10 years and the non-filing spouse has not remarried. Benefits stop for a divorced spouse upon remarriage.

*Rules applicable in most situations. Some exceptions exist. . Social Security Administration, Retirement Benefits, 2010, and Retirement Planner Benefits for Spouses, 2008, SSA.gov 14

HOW CAN I UTILIZE SPOUSAL BENEFITS?

File and Suspend strategy: Makes it possible for married taxpayers who retire at different ages to suspend and collect benefits optimally. Higher-earning spouse (in this case, the husband) files at Full Retirement Age and immediately suspends his benefits. His wife is entitled to 50% of husbands Primary Insurance Amount (once shes 62) and he can wait to receive higher benefit at age 70. Not only can this strategy increase monthly benefits down the road, it ensures a higher benefit if the husband dies first. His wife will still be entitled to receive 100% of husbands entitlement at the time of his death.

Educated Investor Featured Article, File and Suspend, July 2009.

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HOW CAN I UTILIZE SPOUSAL BENEFITS?

Claim Now, Claim More Later strategy: Allows married couples to begin receiving benefits now and still receive larger delayed benefits later. Higher-earning spouse (in this case, the husband) claims spousal benefit at Full Retirement Age (wife must have already filed for her own benefits) and then husband switches to his own benefit at age 70.

Center for Retirement Research, Strange But True: Claim Social Security Now, Claim More Later, April 2009

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WHAT ABOUT TAXES?

Uncle Sam will not cut you a break in retirement

The Social Security Administration defines combined income as adjusted gross income + nontaxable interest + of Social Security benefits.

Social Security Administration, Taxes and Your Social Security Benefits, 2010, SSA.gov

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WHAT ABOUT TAXES?

Tax strategies to consider: Delay benefits (and potential taxes on the benefits) while generating income from other assets. Generate retirement income with Roth IRA distributions. Distributions are not taxable, and can help lower income. Utilize a tax-qualified professional to customize a strategy based on your individual needs.

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WHEN WILL I BE ELIGIBLE FOR MEDICARE?

Most have to be 65 years of age or older. Those with certain disabilities may qualify for Medicare regardless of age. Enrollment is automatic for some who receive Social Security benefits. However, many must apply on their own. Late enrollment may result in costly penalties. Must contact the SSA to opt out of Part B coverage.
THE FOUR PARTS OF MEDICARE

Centers for Medicare & Medicaid Services, Medicare & You, 2011, Medicare.gov

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UNLOCKING SOCIAL SECURITY

What weve learned: What you need to consider when deciding when to file How you and your spouse can work together to optimize benefits What to expect with Taxes and Medicare

Visit SSA.gov to learn more

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TRANSAMERICAS I HAVE A QUESTION CLIENT GUIDE

The I Have A Question Client Guide will provide additional insight into the topics covered today.

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TRANSAMERICAS UNLOCKING SOCIAL SECURITY KIT

Comprehensive kit that your financial professional can share with you

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