Answers to 100 Frequently Asked Questions about Social Security Retirement Benefits

Answers to 100 Frequently Asked Questions about Social Security Retirement Benefits

Answers to 100 Frequently Asked Questions about Social Security Retirement Benefits

Answers to 100 Frequently Asked Questions about Social Security Retirement Benefits

eBookDigital Original (Digital Original)

$13.49  $17.99 Save 25% Current price is $13.49, Original price is $17.99. You Save 25%.

Available on Compatible NOOK Devices and the free NOOK Apps.
WANT A NOOK?  Explore Now

Related collections and offers

LEND ME® See Details

Overview

Completely updated, expert advice on making the most important financial decision of your life.
 
When it comes to Social Security benefits, the first question most people facing retirement asks is, when do I start? Age 62? Given the changing laws and the overwhelming number of core rules and codicils, the answer is, there is no single best answer for everybody. This comprehensive—and comprehensible—book functions both as a primer and to dispel many of the common misconceptions people have about Social Security: what it really is, how it works, and how to get the most from the greatest “investment” you ever made.
 
Best of all, editor John Weber does all the work for you. Sifting through thousands of pages of SSA publications, he narrows down the hundred most important and frequently asked questions about Social Security. He also unscrambles just as many pages of head-scratching answers and lays them all out in clear, concise, and useful language to guide you toward maximizing your retirement benefits in the simplest way possible.
 
From enrollment to payday, this invaluable book will help you make the most informed decisions about securing the comfortable and stress-free future you deserve.
 

Product Details

ISBN-13: 9781504057141
Publisher: Open Road Media
Publication date: 12/11/2018
Sold by: Barnes & Noble
Format: eBook
Pages: 128
Sales rank: 470,831
File size: 2 MB

About the Author

John Weber has previously deciphered The Sopranos (in The Tao of Bada Bing), Dan Brown (An Illustrated Guide to the Lost Symbol, Simon & Schuster, which has been translated into nine languages), and Donald Rumsfeld (The World According to Rummy). He lives in Brooklyn, New York.

Read an Excerpt

CHAPTER 1

Background

1. What are the purposes of Social Security?

2. What programs are included under Social Security?

3. How large is Social Security?

4. How do Social Security benefits and Supplemental Security Income (SSI) payments differ?

5. How is Social Security financed?

6. What are FICA and SECA taxes?

7. What is the current maximum amount of Taxable Earnings for Social Security this year? How has the Maximum Taxable Earnings changed over the years?

8. Do I "own" the money I pay in Social Security taxes?

9. What is the Old-Age and Survivors Insurance (OASI) Trust Fund?

1. What are the purposes of Social Security?

The Social Security Act and related laws establish a number of programs that have the following basic purposes:

* To provide for the material needs of individuals and families;

* To protect aged and disabled persons against the expenses of illness that may otherwise use up their savings;

* To keep families together; and

* To give children the chance to grow up healthy and secure.

2. What programs are included under Social Security?

The following programs are included:

* Retirement insurance;

* Survivors insurance;

* Disability insurance;

* Hospital and medical insurance for the aged, the disabled, and those with end-stage renal disease;

* Prescription Drug Benefit;

* Extra help with Medicare Prescription Drug Costs;

* Supplemental security income;

* Special Veterans Benefits;

* Unemployment insurance; and

* Public assistance and welfare services, including:

• Temporary assistance for needy families;

• Medical assistance;

• Maternal and child health assistance;

• Child support enforcement;

• Family and child welfare services;

• Food stamps; and

• Energy assistance.

[EDITOR'S NOTE: This book deals ONLY with the first two programs listed above: RETIREMENT and SURVIVORS INSURANCE.]

3. How large is Social Security?

In 2017, over 62 million Americans will receive approximately $955 billion in Social Security benefits.

Per December 2016 Beneficiary Data

* Retired workers: 41.2 million/ $56 billion/ $1,360 average monthly benefit [see question #15 for current amount]

Their dependents: 3 million/ $2 billion

* Disabled workers: 8.8 million/ $10.3 billion/ $1,171 average monthly benefit

Their dependents: 1.8 million/ $0.65 billion

* Survivors: 6.1 million/ $6.8 billion

Social Security is the major source of income for most of the elderly.

* Nearly nine of ten individuals age 65 and older receive Social Security benefits.

* Social Security benefits represent about 34% of the income of the elderly.

* Among elderly Social Security beneficiaries, 48% of married couples and 71% of unmarried persons receive 50% or more of their income from Social Security.

* Among elderly Social Security beneficiaries, 21% of married couples and about 43% of unmarried persons rely on Social Security for 90% or more of their income.

Social Security provides more than just retirement benefits.

* Retired workers and their dependents account for 71% of total benefits paid.

* Survivors of deceased workers account for 13% of the total benefits paid.

• About one in eight of today's 20-year-olds will die before reaching 67.

• About 96% of persons aged 20â&8364;"49 who worked in covered employment in 2016 have survivors insurance protection for their young children and the surviving spouse caring for the children.

An estimated 171 million workers are covered under Social Security.

* 51% of the workforce has no private pension coverage.

* 31% of workers report that they and/or their spouse have no savings set aside specifically for retirement.

In 1940, the life expectancy of a 65-year-old was almost 14 years; today it is about 20 years.

By 2035, the number of Americans 65 and older will increase from 48 million today to over 79 million.

There are currently 2.8 workers for each Social Security beneficiary. By 2035, there will be 2.2 covered workers for each beneficiary.

4. How do Social Security benefits and Supplemental Security Income (SSI) payments differ?

The two programs are financed differently.

* Employment taxes primarily finance Social Security retirement, survivors, and disability insurance benefits.

* Generally, we pay Social Security benefits to eligible workers and their families, based on the worker's earnings.

* Meanwhile, general taxes fund the SSI program, which serves the needy. SSI eligibility depends largely on limited income and resources.

5. How is Social Security financed?

Social Security is financed through a dedicated payroll tax. Employers and employees each pay 7.65 percent of wages up to the taxable maximum of $132,900 in 2019, while the self-employed pay 15.3 percent.

6. What are FICA and SECA taxes?

The law requires employers to withhold taxes from employee earnings to fund the Social Security and Medicare programs. These are called Federal Insurance Contributions Act (FICA) taxes. Your employer also pays a tax equal to the amount withheld from employee earnings.

The self-employed pay Self-Employed Contributions Act (SECA) taxes on net earnings. SECA taxes also fund Social Security and Medicare. The self-employed pay both the employee and the employer share of SECA. But the law permits them to deduct half of the self-employment tax as a business expense.

7. What is the current maximum amount of taxable earnings for Social Security this year? How has the Maximum Taxable Earnings changed over the years?

In 2018, the highest amount of earnings on which you must pay Social Security tax is $128,700. In 2019 it is $132,900. We raise this amount yearly to keep pace with increases in average wages. (There is no maximum earnings amount for Medicare tax. You must pay Medicare tax on all of your earnings.)

8. Do I "own" the money I pay in Social Security taxes?

We do not put the Social Security taxes you pay in a special account for you. They are used to pay benefits for people getting benefits today, just as your future benefits will be paid for by future workers.

9. What is the Old-Age and Survivors Insurance (OASI) Trust Fund?

The Social Security trust funds are financial accounts in the U.S. Treasury. There are two separate Social Security trust funds: the Old-Age and Survivors Insurance (OASI) Trust Fund pays retirement and survivors benefits; and the Disability Insurance (DI) Trust Fund pays disability benefits. Social Security taxes and other income are deposited in these accounts, and Social Security benefits are paid from them. The only purposes for which these trust funds can be used are to pay benefits and program administrative costs.

The Social Security trust funds not needed in the current year to pay benefits and administrative costs are, by law, invested in special Treasury bonds that are guaranteed by the U.S. Government. A market rate of interest is paid to the trust funds on the bonds they hold, and when those bonds reach maturity or are needed to pay benefits, the Treasury redeems them.

[SEE ALSO question #97: "What is the current status of the Old-Age and Survivors (OASI) Trust Fund?"]

CHAPTER 2

Basics

10. What is a "mySocialSecurity" online account? What can I do with mySocialSecurity online account?

Setting up a mySocialSecurity online account:

11. What is the verification process you use to set up a mySocialSecurity online account?

12. Will the Identity Services Provider charge me to set up or use a mySocialSecurity online account?

13. Can I create a mySocialSecurity account if I have a security freeze or fraud alert on my credit report?

14. Why is Social Security asking for financial information online if I choose to add extra security to mySocialSecurity account?

[EDITOR'S NOTE: In an article about protection against identity theft in The New York Times (dated October 30, 2017), its author recommends opening a mySocialSecurity account to "stop thieves from creating an account in your name, and redirecting benefits."]

Benefit Basics:

15. What is the average monthly benefit for a retired worker? 16. What is the maximum Social Security retirement benefit payable?

10. What is a "mySocialSecurity" online account? What can I do with mySocialSecurity online account?

"mySocialSecurity" is a free online account that gives you quick and secure access to your personal Social Security information.

[EDITOR'S NOTE: If you value your time, setting up an account is a vastly superior alternative to going down to the local Social Security office or calling their 800 number (800-772-1213 or TTY 800-325-0778). You can set up an account by going to www.ssa.gov/myaccount.]

If you do NOT receive benefits you can:

* Get your Social Security Statement;

* Estimate your benefits;

* View your earnings record; and

* Apply for retirement and spouse's benefits.

If you receive benefits you can:

* Get your benefit verification letter;

* Check your payment information;

* Change your address or phone number; and

* Start or change direct deposit.

11. What is the verification process you use to set up a mySocialSecurity online account?

You must give us your identifying information and answer security questions to pass verification. First, we match the personal information you give us with the data we have in our records. Then, we use our "Identity Services Provider" to further verify your identity.

12. Will the Identity Services Provider charge me to set up or use a mySocialSecurity online account?

No, the "Identity Services Provider" will not charge you to set up a mySocialSecurity online account.

About the Identity Services Provider: The U.S. Social Security Administration uses an external data source, or what we refer to as an "Identity Services Provider," to help us verify the identity of our online customers and to prevent fraudulent access to our customers' sensitive personal information. Equifax is the Identity Services Provider that provides identity verification services to the Social Security Administration.

13. Can I create a mySocialSecurity account if I have a security freeze or a fraud alert on my credit report?

You cannot create a mySocialSecurity account online if you have a security freeze, fraud alert, or both on your credit report. You first must ask to have the freeze or alert removed.

To create a mySocialSecurity account in person without removing the security freeze or fraud alert, visit your local Social Security office.

14. Why is Social Security asking for financial information online if I choose to add extra security to mySocialSecurity account?

Social Security's new security process and federal guidelines require us to take extra measures to verify your identity online. It helps us ensure you are who you say you are and it protects your information.

15. What is the average monthly benefit for a retired worker?

The average monthly Social Security retirement benefit for 2019 is $1,461.

16. What is the maximum Social Security retirement benefit payable?

The maximum benefit depends on the age you retire. For example, if you retire at full retirement age in 2018, your maximum benefit would be $2,788. However, if you retire at age 62 in 2018, your maximum benefit would be $2,159. If you retire at age 70 in 2018, your maximum benefit would be $3,698. The maximum benefit payable to a worker retiring at Full Retirement Age in 2019 is $2,861.

CHAPTER 3

Eligibility

Please see Chapter 6, "Spouses, Dependents, and Survivors," for information concerning eligibility for benefits based on someone else's work record.

17. How do I earn Social Security credits and how many do I need to qualify for benefits?

18. Can work outside the United States help me qualify for Social Security benefits?

19. Can I contribute money to Social Security to earn extra credits?

20. How can I get a Social Security Statement that shows a record of my earnings and an estimate of my future benefits?

21. How do I correct my earnings record?

22. Can I get Social Security retirement benefits and military retirement benefits?

23. If I get Social Security disability benefits and I reach full retirement age, will I then receive retirement benefits?

24. Can non-citizens living in the United States receive Social Security benefits?

25. Can non-citizens living outside the United States receive Social Security benefits?

26. Can prisoners get Social Security payments?

27. What if I apply but Social Security decides I do not qualify for benefits? Will I receive a penalty or fine?

17. How do I earn Social Security credits and how many do I need to qualify for benefits?

We use your total yearly earnings to figure your Social Security credits. The amount needed for a credit in 2019 is $1,360. You can earn a maximum of four credits for any year. The amount needed to earn one credit increases automatically each year when average wages increase. You must earn a certain number of credits to qualify for Social Security benefits. The number of credits you need depends on your age when you apply and the type of benefit application. No one needs more than 40 credits for any Social Security benefit.

18. Can work outside the United States help me qualify for Social Security benefits?

The United States has Social Security agreements with more than two dozen foreign countries. The agreements have two main purposes:

* To eliminate dual Social Security payments and coverage; and

* To help fill gaps in protection for workers who have divided their careers between the United States and other countries.

19. Can I contribute money to Social Security to earn extra credits?

You cannot get more credits by voluntarily contributing money to Social Security. You can earn credits only by working in a job or your own business that is covered under Social Security.

20. How can I get a Social Security Statement that shows a record of my earnings and an estimate of my future benefits?

You can get your personal Social Security Statement online by using your mySocialSecurity account. If you don't yet have an account, you can easily create one. Your online Statement gives you secure and convenient access to your earnings records. It also shows estimates for retirement, disability, and survivors benefits you and your family may be eligible for.

We also mail paper Statements to workers age 60 and older three months before their birthday if they don't receive Social Security benefits and don't yet have a mySocialSecurity account. Workers who don't want to wait for their scheduled mailing can request their Social Security Statement by mail — please print and complete a "Request For Social Security Statement" (Form SSA-7004) and mail it to the address provided on the form.

You should receive your paper Social Security Statement in the mail in four to six weeks.

21. How do I correct my earnings record?

Ordinarily, you cannot correct your earnings after three years, three months, and 15 days from the end of the taxable year in which your wages were paid. However, you can correct your record after that length of time to:

* Confirm records with tax returns filed with the Internal Revenue Service;

* Correct errors due to employee omissions from processed employer reports or missing reports;

* Correct errors "on the face of the record," that is, errors we can find by examining our records of processed reports; and

* Include wages reported by an employer as paid to an individual, but not shown in our records.

To correct your Social Security earnings record, contact us at 1-800-772-1213 (TTY 1-800-325-0778). It will be helpful to have information such as Forms W-2, pay stubs, etc.

22. Can I get Social Security retirement benefits and military retirement benefits?

You can get both Social Security retirement benefits and military retirement. Generally, we do not reduce your Social Security benefits because of your military benefits.

23. If I get Social Security disability benefits and I reach full retirement age, will I then receive retirement benefits?

Social Security disability benefits automatically change to retirement benefits when disability beneficiaries become full retirement age. The law does not allow a person to receive both retirement and disability benefits on one earnings record at the same time.

24. Can non-citizens living in the United States receive Social Security benefits?

Yes, if they are lawfully in the United States and meet all eligibility requirements. Lawfully present non-citizens include, but are not limited to:

* Non-citizens lawfully admitted for permanent residence under the Immigration and Nationality Act (INA);

* Certain non-citizens admitted under other INA classifications that allow them to live and work in the United States;

* Non-citizens admitted under Family Unity or Immediate Relative provisions; and

* Other non-citizens who are fully insured for retirement, survivors, or disability benefits, and who continue to meet U.S. lawful presence requirements.

Non-citizens authorized to work in the United States who got a Social Security number after December 2003 can qualify for Social Security benefits.

(Continues…)


Excerpted from "100 Answers to Frequently Asked Questions about Social Security Retirement Benefits"
by .
Copyright © 2018 Welcome Rain Publishers LLC.
Excerpted by permission of OPEN ROAD INTEGRATED MEDIA.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

Table of Contents

ForewordIntroductionChapter 1: BackgroundChapter 2: BasicsChapter 3: EligibilityChapter 4: When to ApplyChapter 5: Applying
Chapter 6: Spouses, Dependents, and SurvivorsChapter 7: Once You Are RetiredChapter 8: Recent ChangesChapter 9: The Future of Social SecurityAfterword: Some TakeawaysSources and Further Reading
From the B&N Reads Blog

Customer Reviews