Posts Tagged ‘social security’

No Increase In Social Security Benefits For 2011

Friday, October 15th, 2010

No cost-of-living increase, no COLA.

  • In 1975, a system was set up to automatically increase Social Security benefits so that recipients (elderly and disabled Americans) could keep up with the cost-of-living increases brought about by inflation.
  • At the end of 2010, the Social Security Administration decided to cancel automatic cost of living adjustment (COLA) because the inflation rate (usually around 3%) was too low to justify it. Now the SSA has decided to cancel the increase for 2011 as well.
  • Despite low the inflation rate, many Social Security recipients have lost money on their retirement investments and the value of their homes.

Facts & Figures

  • Social Security provides benefits for 58.7 million Americans.
  • In 2009, the COLA reached a 27-year high of 5.8%.
  • The average monthly Social Security check is $1,072.

Best Quote

“We’re a little bit upset because our bills are going up and our Social Security isn’t.” – Betty Dizik, 83, Retired Tax Preparer and Social Worker

The Educated, Unemployed Generation

Wednesday, October 21st, 2009

It’s normal to be unemployed right after college, but being young and unemployed for a long time is bad for everyone.

  • Young people are being disproportionately affected by the recession because they’re missing out on entry-level employment opportunities, even when they’re highly qualified. Employers lose, too: young employees bring freshness and ambition to the job.
  • Being unemployed in one’s youth can lead to lower lifetime earnings due to missed opportunities, experiences, and sometimes a stigma. On a large scale, this will adversely affect tomorrow’s retirees, who will depend on this generation’s earnings to fund their Social Security benefits.
  • Some call for government action in the form of a more flexible minimum wage (employers that must pay the increased minimum wage are increasing their education and experience requirements commensurately), or increased training and apprenticeship programs. But the budget deficit makes these options unlikely.

Facts & Figures

  • The unemployment rate for 16- to 24-year-olds is more than 18% in the U.S., 39% in Spain, 24% in France, and 19% in Britain.
  • 46% percent of 16- to 24-year-old Americans were employed in September 2009.
  • A study showed that 15 years out of school, workers began their careers in a recession earned 2.5% less than workers who began in a better economic climate.

Best Quote

“Every morning I wake up thinking today’s going to be the day I get a job. I’ve not had a job for months, and it’s getting really frustrating.” – Dan Schmitz, recent college graduate

Social Security is…

Thursday, August 20th, 2009

Social security is a program run by the U.S. government that provides workers and their dependents with money for retirement and injuries that prevent regular employment. Everyone with a legal job pays a Social Security tax, which represents a small percentage of their salary. The idea is that you pay into this huge fund throughout your career, and then when you retire you have the right to receive regular payments from this fund to help cover the cost of living without a job.

How does Social Security work?

Monday, August 10th, 2009

Everyone who works has to pay Social Security taxes on their earnings. Employers and employees pay social security taxes, and self-employed individuals pay twice as much, being both employer and employee. You pay Social Security every year for as long as you work.

So what do you get in return for shelling out all this money to the government? Once you stop working for a legitimate reason, like retirement or injury, the government supports you with the money that was collected in Social Security taxes. In addition, because you were the one paying all those taxes for so many years, you don’t have to be in desperate need of funds to qualify for Social Security – you have a legal right to those benefits.

There are certain terms and conditions, of course. People who earned more money throughout their lives paid more money in Social Security taxes, so they have a right to higher benefits. However, Social Security is weighted in favor of workers with lower lifetime earnings and workers with families to support. This means that even though the wealthier may get higher absolute benefits, low wage earners get more money relative to how much money they paid throughout their lives. The goal of Social Security is to prevent those who have stopped working from becoming poor, but it isn’t a charity: you’re paying the government when you’re young and healthy so you can use that money when you’re not.

Social Security Tax is…

Wednesday, July 29th, 2009

Social security tax is a federal tax that is used to pay for Social Security programs.

Retirement is…

Tuesday, June 23rd, 2009

Retirement is the end of work as you know it. People usually retire when they have saved enough money to live comfortably off of their lifelong earnings.