Benefits of Social Security

Overview

In 1937, social security was established for workers. This is mostly develop to help the workers and has grown to cover a wide range of benefits.

At least 10 years (40 quarters) pay in is required to obtain the insurance and benefits of this for each worker. This amount will depend on the taxable income amount which the worker earns. According to current laws, anyone earning up to $100,000 is eligible for tax. While calculating the benefits, some restrictions are applied such as to be covered a worker must have been covered by minimum six quarters of the past 13 calendar quarters.

There are different ways to receive the social security benefits. Some are listed below.

1. Worker’s Benefits: A monthly payment payable for life to disabled or retired worker.
2.Spousal Benefit: A monthly income for a spouse or disable or retired worker.
3. Widow’s Benefit: A monthly income for a surviving or former spouse of a deceased or disabled worker.
4. Child’s Benefit: A monthly benefit for dependent children of a disabled, deceased or retired worker.

Some important factors…

1. The life expectancy has increased by the 34 percent since 1934. Because of increased demand for retirement benefits, the rate paid by the workers is increased.
2. Because of the high birth rate of baby boomers, the short term financial issues are created and this helps to create the stress on the retirement funds.

When Social Security was formed, President Roosevelt promised that income benefits would be far from the income tax. It will be not taxed fir the income tax purposes. But in 1984, President Reagan made changes in the statement and kept 50 percent tax on all social security benefits. In 1992 President Clinton changed the taxation rate to 85 percent. These current tax rates are still in effect