With the entry into force of the new retirement rules originated by the pension reform, many insured people are not knowing which is the most appropriate rule and when is the best time to request their retirement.
To solve this type of doubt, it is possible to carry out a pension plan with a specialized professional. But what exactly is pension planning? What is the purpose of planning and what is the importance of carrying it out? In this post we will talk a little about this subject.
What is pension planning?
Pension planning is an in-depth study of the insured’s contributory life, which takes into account the analysis of contribution time, types of bonds, special activities, types of contribution rates, among other factors.
It is important to highlight that social security planning is the analysis of the contribution periods already made by the insured and thus identify which are the existing possibilities for retirement of this insured and which is the most favorable option.
The realization of a social security plan allows the insured to keep their contributory life organized, avoiding losses in future contributions.
In addition, it allows the identification of errors and existing failures that can lead to a reduction in future benefits.
Many people do not know this information and when they apply for retirement due to contribution time or need a Certificate of Time of Contribution, they receive a rejection from the SSA without understanding the reasons.
For those insured who already have a long time of contributions to Social Security, planning offers greater security regarding the possibilities of retirement, especially at this time of transition from social security rules.
For younger policyholders, social security planning helps in making decisions that will support a more adequate retirement.
What is pension planning for?
The realization of a pension plan serves to analyze in depth the contributory life of the insured so that he knows what are the applicable rules in his case and the best time to apply for retirement.
This analysis takes into account not only the time of contribution constant in the CNIS of the insured, but also the types of bonds, existence of special, rural activities, contribution rates, among other data.
Carrying out a pension plan is one of the most effective ways to guarantee the granting of the best benefit to the insured, since with it there is a prior organization of all relevant information about the contributory life.
It is worth noting that in several circumstances, in addition to fulfilling the necessary requirements of the desired benefit, the insured must prove the effective exercise of the activity, or adequacy to the current rules, thus, the planning anticipates the possible problems and difficulties that the insured will meet.
This is the purpose of social security planning, to simplify the way of collecting and treating contributory information, minimizing the difficulties that may arise and projecting the future of the insured.
What is the importance of pension planning?
Retirement planning becomes relevant because it guarantees the insured the necessary knowledge to obtain the best benefit, with the correct time and contribution amount for each situation.
It is worth noting that sometimes the insured person is entitled to receive a retirement pension, however, the benefit is denied by the SSA due to the lack of correct documentation to prove the requirements, and this situation can be avoided by carrying out a planning.
In addition to all of the above, the financial impact that good planning can bring must also be considered, since it makes it possible to avoid the financial loss caused by a retirement before or after the ideal time.
In addition, planning helps to receive the best possible benefit in each case with the correct benefit salary.
Is it possible to predict what the Initial Monthly Income of the benefit will be?
It is necessary to emphasize that pension planning cannot predict what the exact value of the RMI (Initial Monthly Income) of a retirement will be. This is because it is not possible to specify what the minimum wage, the social security ceiling and the contribution rates will be in the coming years.
Furthermore, the contributions are monetarily updated according to the indices on the date of calculation, and are changed every month that follows. It means to say that it is not possible to know the updated rates of contribution salaries in the future.
Thus, pension planning will serve to help the insured on the best and most advantageous benefit options; however, it is not possible to say exactly the value of retirement.
If you have any questions about pension planning or want to make one, please contact us. We are available.
Posted by: John Labunski Dallas