But if you wait until age 70 to start collecting, you get a “bonus,” called “delayed retirement credits.” In other words, the longer you wait to collect, the more you will collect each month.
Today, the program has a variable timeline-you can start taking reduced benefits as early as age 62, but your “full retirement age,” when you receive 100 percent of your Social Security benefits, is currently age 67 for those born in 1960 or later. The original age to collect benefits was 65, based on life expectancy at that time, but as we live longer, the program has been updated to push out the age when you start collecting benefits. Then in 1965, President Lyndon Johnson added another component to the Social Security program with Medicare, a health insurance program for those 65 years or older, or those younger than 65 with certain disabilities. Originally designed just for the primary worker, the program added survivor benefits and benefits for the retiree's spouse and children in 1939 and disability benefits in 1956. He introduced what he called a “plan for social insurance as a safeguard against the hazards and vicissitudes of life" and signed the Social Security Bill into law on August 14, 1935. Roosevelt’s efforts to stabilize the country’s economy through the “New Deal” programs. Why did Social Security start?įor the birth of the Social Security system, we go back to the Great Depression, and President Franklin D. But before we look at its future, let’s explore where it came from and where it is today. That set-up is precisely why Social Security is such a hot topic, as prognosticators anticipate there will one day be more people collecting money than paying into it. The program is known as “pay-as-you-go” which means that today’s workers are funding benefits for today’s recipients in other words, your money is not sitting in an account waiting for you (and, yes, that’s why you should be investing your money, too, in order to ensure you have your own retirement account with your name on it). According to the National Academy of Social Insurance, about 169 million Americans currently pay into the Social Security system, with approximately 61 million collecting monthly benefits-the group estimates one-quarter of American families receive income from Social Security. Employees have a Social Security tax taken out of their paychecks now with the idea that they will benefit from Social Security themselves down the road. Social Security is often referred to as a “safety net” for retirees and the disabled, along with the families of the retired, disabled or deceased (with certain restrictions). Let’s dig in to the dollars and sense of Social Security to figure out what it is and why it’s so important. And that’s the point: It is designed to ensure we all have funds available to spend on food and necessities when we retire, or if we should become disabled or lose your spouse, provided we’ve paid into the system as a worker.
The very name of this program is intended to make us feel, well, secure. What will you live on when you quit working? Ideally, you have been socking away money that will grow into a well-funded nest egg to keep income flowing, but you’re probably also expecting to receive some money from the government in the form of Social Security.
0 kommentar(er)
