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Midpack · 03-11-2012, 09:25 AM

Quote:

Originally Posted by seraphim

I'm a bit bothered, though, that so many people who DO participate don't seem to understand how it works.

You mean voters? We probably couldn't have extreme liberals and extreme conservatives any other way...and we seem to have more of both as the years go by.

**MichaelB** · 03-11-2012, 10:03 AM

Quote:

Originally Posted by seraphim

I stand corrected lol. I thought SSI stood for something else.

I don't participate in SS, and normally don't pay it much attention. The payroll tax reduction affects me not at all.

I'm a bit bothered, though, that so many people who DO participate don't seem to understand how it works.

When you say you do not participate, do you mean you don't pay into SS or you are not collecting yet?

seraphim · 03-11-2012, 10:15 AM

Quote:

. When you say you do not participate, do you mean you don't pay into SS or you are not collecting yet?

I don't pay into SS, and - according to their info sheets they send out - I will qualify for a bit due to work I did in HS, college, and a job I had prior to entering government service.

There is one aspect I am still confused about in my case: I may fall into a non-contributing category. I've been unable to get it clarified.

But the amount SS says I'll get is very minimal. Not really a factor in my budgeting.

DW is a teacher. She does not contribute, and SS says she does not qualify for benefits.

seraphim · 03-11-2012, 10:17 AM

Quote:

. You mean voters? We probably couldn't have extreme liberals and extreme conservatives any other way...and we seem to have more of both as the years go by.

I mean workers. A friend of mine assumed he was going to receive about $3000 a month, because someone else he knew received that much. He ended up only getting half as much. An unpleasant surprise.

There have been discussions on other forums, and the amount of incorrect information being generated is surprising, which is why I did some checking on my own.

**Alan** · 03-11-2012, 10:42 AM

Quote:

Originally Posted by seraphim

I mean workers. A friend of mine assumed he was going to receive about $3000 a month, because someone else he knew received that much. He ended up only getting half as much. An unpleasant surprise.

There have been discussions on other forums, and the amount of incorrect information being generated is surprising, which is why I did some checking on my own.

It is surprising that your friend did not have an idea of what SS he was likely to receive as, apart from a couple of recent years, the SSA has been sending out annual statements to every indivudual that not only lists their salary history but also gives estimates of their benefits.

seraphim · 03-11-2012, 11:25 AM

Quote:

It is surprising that your friend did not have an idea of what SS he was likely to receive as, apart from a couple of recent years, the SSA has been sending out annual statements to every indivudual that not only lists their salary history but also gives estimates of their benefits.

I know. Don't ask me. I know what he told me a year and a half ago, when he talked about selling his business, and what he told me last week. I know I'm extremely cynical, but lot of people don't pay attention to what's in front of them - including a statement from the SSA.

Midpack · 03-11-2012, 11:27 AM

Quote:

Originally Posted by seraphim

I mean workers. A friend of mine assumed he was going to receive about $3000 a month, because someone else he knew received that much. He ended up only getting half as much. An unpleasant surprise.

There have been discussions on other forums, and the amount of incorrect information being generated is surprising, which is why I did some checking on my own.

I meant that those same people who don't understand how Soc Sec works even though they're beneficiaries, are also voters, a scary thought?...sorry.

growing_older · 03-11-2012, 11:34 AM

Quote:

I'm a bit bothered, though, that so many people who DO participate don't seem to understand how it works.

There's a lot of alphabet soup and some of it seems deliberately intended to cause confusion. As for how it works, you mean how it worked when I first enrolled? or now? or when I'm likely to get any benefits? or at any point with all the rule changes in between?

How it works is simple: I pay the amount they require through payroll deduction, so I never see that money and have no control over the amount taken. When I'm old enough I will have some choices about when to receive benefits (if any) and none of it is guaranteed, so I take my chances if I plan on it. It's more complicated if I'm self-employed.

seraphim · 03-11-2012, 11:50 AM

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As for how it works, you mean how it worked when I first enrolled? or now?

Have you found there to be a difference?

Chuckanut · 03-11-2012, 12:27 PM

Quote:

Originally Posted by seraphim

IA friend of mine assumed he was going to receive about $3000 a month, because someone else he knew received that much.

Assume - Ass U Me - When you assume something you make an Ass out of U and Me.

Chuckanut · 03-11-2012, 12:30 PM

Quote:

Originally Posted by seraphim

DW is a teacher. She does not contribute, and SS says she does not qualify for benefits.

I believe those days are long gone for most of us. I have been a teacher and I always paid SS, just like anybody else earning a dollar. I think, at some earlier time, some government entities could opt out of SS if they provided their own pension plan. Today, other than those grandfathered in, I do not believe that is possible.

ERD50 · 03-11-2012, 01:07 PM

Quote:

Originally Posted by Chuckanut

I believe those days are long gone for most of us. I have been a teacher and I always paid SS, just like anybody else earning a dollar. ...

This apparently varies by State, so you have to be careful with broad-brush statements. I was pretty sure that teachers in IL do not pay into, nor receive benefits for SS. As I am just now double checking DDs taxes for her (she is a first year teacher here in IL), I looked again at her W2, and she most definitely does not pay into SS.

-ERD50

growing_older · 03-11-2012, 01:16 PM

Quote:

Have you found there to be a difference?

Was this a serious question? Social Security has been tinkering with the percentages withheld frequently. FICA & SECA Tax Rates As well as adjusting the wage base on which it is levied annually. FICA & SECA Tax Rates As for the retirement dates, those also have been adjusted from a standard for everyone, to an age based standard depending on when you were born. Retirement benefits by year of birth Not to mention numerous rule changes such as the file and withdraw Retirement Planner: If You Change Your Mind They have changed the rules for taxation of benefits and are talking seriously about adding additional means testing. Yes, you can plan on the contribution of Social Security benefits in your retirement plans, but they better be flexible plans, because the social security rule and benefit changes show no signs of stabilizing or becoming any more reliable than they have been in the past. Currently under serious consideration: adjusting ages again, increasing wage base, modifying benefit calculations, changing tax treatment, adding unspecified means testing.

seraphim · 03-11-2012, 01:51 PM

Quote:

. I meant that those same people who don't understand how Soc Sec works even though they're beneficiaries, are also voters, a scary thought?...sorry.

Ok - now I understand lol. I missed the implied tone...

seraphim · 03-11-2012, 01:52 PM

Quote:

. Was this a serious question

Yes. I haven't followed the nuances and changes, as it really doesn't affect me. I'm interested in your observations.

seraphim · 03-11-2012, 01:56 PM

Quote:

. This apparently varies by State, so you have to be careful with broad-brush statements. I was pretty sure that teachers in IL do not pay into, nor receive benefits for SS. As I am just now double checking DDs taxes for her (she is a first year teacher here in IL), I looked again at her W2, and she most definitely does not pay into SS.

I found the initial SS contract from 1935 to be an interesting read. The federal government mandated it, in general, gave each state a minimum amount of money to initiate the program, then stepped out. There were no guidelines as how to set up or run the program. Nada.

Details were left to each individual state.

As for paying into SS, I read somewhere on the SSA site(if memory serves) that certain public employees could be classified non-contributing participants, and though they could not collect full benefits, they couldn't lose more than half of their benefits(?). Does that mean they can collect no less than 20% of their working income?

I don't know and can't find clarification.

justplainbll · 03-11-2012, 02:07 PM

My high school buddy who retired from a DOD job 10-12 years ago 'bemoans' the fact he did not have to make FICA contributions.

seraphim · 03-11-2012, 02:15 PM

From the SSA benefit calculator - note the comment about percentages:

Quote:

. How much income will you need?
Under current law, if you have average earnings, your Social Security retirement benefits will replace about 40 percent of your pre-retirement earnings. The percentage is lower for people in the upper income brackets and higher for people with low incomes.

Your Social Security benefits are the foundation on which you can build a secure retirement. Savings and pensions also are key components of your retirement plan. Most financial advisors say you'll need about 70 percent of your pre-retirement earnings to comfortably maintain your pre-retirement standard of living. They recommend that you prepare for the future with a combination of Social Security, private pensions and personal savings.

Make a note of your benefit estimate, and any pension you may qualify for, and continue your planning with the Retirement Income Estimator (new browser).

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