I'm so sorry for the loss of both your parents, Chloe. That must be an incredibly difficult and overwhelming time for you and your siblings. I wanted to add my voice to everyone else's reassurance - your inheritance will absolutely not affect your Social Security retirement benefits. I work as a benefits counselor and see this question frequently. The key thing to understand is that Social Security only counts "earned income" (wages, salary, self-employment) against the earnings test for early retirees. Your $137,000 inheritance is considered "unearned income" and won't impact your monthly payments at all. You can receive the full amount without any worry about benefit reductions. One practical tip: when you meet with your tax preparer next year, make sure they properly categorize this as inheritance proceeds rather than any other type of income. While it won't affect your Social Security, proper documentation always helps avoid confusion. Please take care of yourself during this difficult transition - you have enough to process without worrying about your benefits being affected.

I'm so deeply sorry for your loss, Chloe. Losing both parents within a year is an unimaginable tragedy, and my heart goes out to you and your siblings during this incredibly difficult time. I can completely understand why you'd be worried about protecting your Social Security benefits - when you're grieving and dealing with so many changes, financial security becomes even more important. I'm happy to add my voice to everyone else's reassurance: your inheritance will absolutely not affect your Social Security retirement benefits in any way. I went through something very similar when my aunt passed and left me proceeds from her property sale (about $85,000). I was also collecting early retirement benefits and had the exact same fear you're experiencing now. But as everyone here has correctly explained, Social Security only considers "earned income" like wages or self-employment earnings when applying the annual earnings test. Your $137,000 inheritance is classified as "unearned income" and won't count against your benefits at all. What really helped me during that time was reminding myself that this money represents your parents' love and their desire to provide for you even after they're gone. You deserve to receive it without additional stress or worry. Please focus on taking care of yourself and processing your grief with your siblings. The financial side is truly one less burden you need to carry right now.

As another newcomer to this community, I wanted to add my perspective as someone who's currently going through the representative payee process for the first time. My husband recently started receiving Social Security disability benefits, and our 12-year-old son qualifies for auxiliary benefits on his record. I can confirm what many others have shared - while separate accounts aren't technically mandatory, they make everything so much easier. We initially tried keeping everything in our regular checking account, but when it came time to fill out the SSA-623 form, it was really difficult to trace exactly how the benefits were spent versus our other income. We ended up opening a dedicated savings account at our local credit union specifically for our son's benefits. The account earns better interest than a checking account, and the credit union was very knowledgeable about representative payee requirements. They even provided me with a simple tracking sheet that helps with the annual reporting. One thing I learned that might help others: if your child has any ongoing medical expenses (therapy, medications, etc.), keep those receipts in a separate file. Even though you don't need to submit them with the annual form, having them organized makes it much easier to calculate how much of the benefits went toward medical care. The process really isn't as intimidating as it initially seems, especially with all the great advice shared in this thread!

As a newcomer to this community, I wanted to share some additional resources that might be helpful for anyone navigating representative payee responsibilities. I recently discovered that many state disability advocacy organizations offer free workshops specifically about Social Security benefits and representative payee duties. These workshops often include practical exercises like filling out sample SSA-623 forms and Q&A sessions with experienced advocates. Also, for those worried about record-keeping, I found that many banks and credit unions can provide quarterly or annual summaries of account activity that categorize transactions by type. This can be incredibly helpful when it's time to complete your annual reporting, as it gives you a clear overview of how funds were used without having to track every individual transaction. One more thing I learned: if you're ever unsure about whether a particular expense is appropriate for the child's benefits (like extracurricular activities or educational supplies), the SSA has a helpful publication called "A Guide for Representative Payees" that includes specific examples of acceptable uses of benefits. It's much more detailed than what you'll find on their main website. Thanks to everyone who has shared their experiences in this thread - it's been incredibly educational for those of us just starting this journey!

I just want to add a word of caution here - while the advice about 401k contributions reducing your countable earnings for the Social Security earnings test is correct, make sure you understand the timing implications. Since you're doing 1099 consulting work, you'll likely need to make quarterly estimated tax payments AND quarterly retirement contributions to stay consistent throughout the year. Don't wait until December to dump $4,000 into a Solo 401k - spread it out so your net earnings stay below the limit each quarter. Also, remember that with self-employment income, you can deduct half of your self-employment tax as well, which further reduces your countable earnings. I'd strongly recommend working with both a tax professional and calling SSA (or using that Claimyr service someone mentioned) to verify your specific situation before you start drawing benefits.

Great advice from everyone here! I'm also approaching 63 and have been researching this exact scenario. One thing I'd add is that if you're doing consulting work as a 1099 contractor, you might also want to consider a SEP-IRA instead of a Solo 401k - it's often simpler to set up and manage, and you can contribute up to 25% of your net self-employment income (after deducting half of your self-employment tax). With $26,000 in consulting income, you could potentially contribute around $5,000-$6,000 to a SEP-IRA, which would definitely get you under that $22,320 earnings test limit. The key is making sure you set it up early in the year so you can make regular contributions rather than scrambling at year-end. I'd also suggest keeping detailed records of all your business expenses since those reduce your net earnings too. Has anyone here used a SEP-IRA for this purpose, or is the Solo 401k generally better?

I'm in a very similar boat - turned 62 last month and my ex won't be 62 for another 2 years! Initially I was frustrated about having to wait, but after reading through everyone's responses here, I'm starting to see this delay as a blessing in disguise. One thing I'd add that hasn't been mentioned yet - if you're still in touch with your ex (amicably), it might be worth having a conversation about his retirement plans. Not that it changes the rules, but knowing whether he's planning to file at 62 or wait longer could help inform your own strategy. My ex mentioned he's planning to work until 67, which actually doesn't matter for my ex-spouse benefit calculation, but it's good to know for planning purposes. Also, I found the SSA's online benefit calculators really helpful, but they can be confusing at first. Don't be discouraged if the numbers seem off initially - there are a lot of variables they factor in. The WEP and GPO calculators are particularly important if you have any government pension income. Sara, given that you were married 23 years, your ex likely has a substantial work history which could mean a decent ex-spouse benefit for you. Those extra 3 years of waiting might really pay off!

I'm currently dealing with a similar waiting period situation and wanted to share something that's been helpful for me. While you're waiting for your ex to turn 62, consider requesting a "Benefits Estimate" letter from SSA that shows projections for both your own retirement benefit and the potential ex-spouse benefit. This can give you a clearer picture of which option might be better when the time comes. Also, I learned that if you're currently receiving any other government benefits (like unemployment, disability, or even some state benefits), there might be coordination rules that could affect your Social Security strategy. It's worth mentioning these to SSA when you do eventually file. One last thing - keep track of any major life changes during these waiting years (health issues, significant income changes, remarriage considerations) as they could all impact your optimal filing strategy. The silver lining is that Social Security rules and benefit amounts can change, and sometimes waiting works out better than we initially expect!

I went through almost the exact same situation two years ago when I was approved for SSDI after my lupus made it impossible to continue working as a nurse. The shock of realizing that LTD and SSDI don't stack was devastating - I had the same misconception that they would be additive income. Here's what I learned that might help you: First, definitely apply for auxiliary benefits for your 17-year-old daughter right away. Even if she only gets a few hundred dollars a month, every bit helps. Second, once you're on SSDI for 24 months, you'll qualify for Medicare which can significantly reduce your healthcare costs compared to COBRA. One thing that actually worked out better than expected was the tax situation - my LTD payments were fully taxable, but a good portion of my SSDI isn't (depends on your total household income). This ended up saving me about $200/month in taxes. Also, look into your state's disability assistance programs and local utility assistance. Many areas have programs specifically for people on SSDI that can help with mortgage assistance or utility bills. Your local Area Agency on Aging might have resources even though you're under 60 - they often handle disability services too. Hang in there - the financial adjustment is scary but you'll find ways to make it work.

I'm going through something very similar right now - just got approved for SSDI after being on employer LTD for about 6 months due to a spinal injury. The reality check about the offset was brutal when I finally understood it properly. One thing that might help with your specific situation: since you mentioned your mortgage is $1,400 and that's most of your SSDI amount, you might want to look into whether you qualify for any mortgage assistance programs. Some lenders have hardship programs for people who become disabled, and there are also HUD counseling services that can help negotiate payment modifications. Also, I noticed someone mentioned checking your earnings record - definitely do this! I found that SSA was missing two years of my highest earnings because of a job where my employer didn't report correctly. Getting that fixed bumped my monthly benefit up by about $180. The whole situation is overwhelming at first, but between the tax advantages, potential dependent benefits for your daughter, and various assistance programs, you'll likely find ways to make it more manageable than it seems right now.