My Research About Social Security As Immigrant-Part 1
Tuesday, October 16, 2012, 2:00 AM | Leave Comment
Technically, everyone in these United States is an immigrant. Some came long time ago, long enough that they became the first citizens after the country got its independence. Sadly enough, some of their descendents believe they own the country.
As an immigrant, I never bothered to learn about social security and accordingly what my benefits would be when I retired.
For the first generation of immigrants who still visit their old country, I did my research on Social Security – what it is and what are its benefits to you after you have taken part in the system long enough to be eligible to collect Social Security when you retire.
After you turn 50, the Social Security Administration will send you a letter stating what your benefits will be when you retire.
It would state your benefits up to the time when you received the letter. It also includes the statement what your spouse and kids would receive, if anything, in case you died.
Here is a brief description of my research:
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What the heck is Social Security (SS)?
The first time I heard about SS was when I first migrated to the States in the 70s. I thought the Government will give money to people when they retire by being social. The more social they are, the more money they get.
The only work I had to do was being social. Because many of us – the new immigrants – at that time thought money grew on trees in the U.S., and SS was simply a part of it.
Needless to say, like so many other things, we were so wrong about SS. On the contrary, people have to work hard a good part of their professional life to be eligible to receive SS when they retire.
Everyone must take part in the system now when they are younger to get benefits later.
The younger generation must chip in to support the older generation, just like the present day retirees chipped in when they were younger. And this cycle must go on in the foreseeable future.
Contributions take the form of the Federal Insurance Contributions Act (FICA) taxes that are withheld from most paychecks. To be sure, you should check your paycheck stub.
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Where did this system come from?
It was not sent to us directly from heaven, like Manna. That’s for sure. Actually, Social Security was established in 1935 by the Social Security Act. Before that, support for the elderly wasn’t a federal concern – it mostly fell to states, towns and, of course, families.
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As long as we are on the subject, what’s Medicare?
Medicare benefits are commonly considered part of Social Security benefits, although technically Medicare is a separate program.
Medicare contributions are withheld from your paycheck in much the same way as your Social Security contributions. FICA taxes support Social Security and Medicare.
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Is it only for me and you when we retire?
No way, Jose. Disability and survivor benefits are included in the program.
Contributions you make provide insurance in the event you become disabled. They also may cover your adult child if he or she becomes disabled before age 22.
And, assuming you worked enough to qualify for retirement benefits, your spouse and children can receive Social Security survivor benefits after you die.
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I still don’t understand the process. You know – the works?
You accumulate credits based on your earnings. In 2008, you get one credit for every $1,050 you earn – that figure is adjusted higher each year, up to a limit of four credits per year.
These credits remain on your record even if you change jobs or stop working for a while.
If you were born after 1929, you need 40 credits in order to receive Social Security retirement benefits.
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Are you and me eligible for SS benefits?
Of course, we are. Well! you have to take part in the system. It’s not like you migrate to the States like I did and you start collecting.
You must work for at least 10 years which is the minimum amount of time required to earn the mandatory 40 credits – 4 credits a year times 10 years.
Even if you have accumulated your 40 credits, however, you can’t start getting payouts until you are 62 or older. That’s one more year for me to start collecting if I choose to retire next year.
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I didn’t understand the credit thing – can you explain?
The Social Security Administration (SSA) mails out a summary of your benefits each year, about three months before your birthday.
You can also request one by calling the SSA (800-772-1213) and asking for a form SSA-7004, or by downloading Request for Social Security Statement.
Your statement provides a record of your earnings history, the number of credits you have accumulated to date, and an estimate of the retirement benefits available if you wait until full retirement age.
Because your benefits depend on your lifetime earnings, check the statement closely to make sure all the information is accurate.
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A while back, you mentioned Medicare. What’s its eligibility criteria?
You are eligible for Medicare benefits once you reach 65, provided you have accumulated the necessary 40 credits. Life is not that simple.
You have to abide by the law, the rules and regulations to get the benefits of living in the States when the time comes. It has to be Kosher.
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When can I start getting payouts? Now, that’s music to my ears.
The earliest you can start collecting Social Security retirement benefits is age 62; the latest is age 70. When you start collecting payouts in that eight-year span is up to you.
Your actual retirement date doesn’t matter. You can retire before 62 if you like, and you can retire after 70.
If you retire before 62, though, you will have to make sure you have enough money set aside to support you until Social Security payments kick in.
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You are 40 now. Why should you wait past age 62 to start collecting?
The government makes you wait until “full retirement age” in order to start collecting the full retirement payout that you have earned.
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What’s full retirement age you ask?
It used to be 65, but Congress voted in 1983 to raise it to 67 for everyone born in 1960 or later. For those workers born between 1938 and 1960 – one of them is yours truly, the full retirement age varies depending on your birth year. To find out yours, refer to the Social Security online retirement planner.
In a Nutshell
If you are 61 years young, you should be in a position to know a little about your social security benefits – what’s coming to you. Understanding social security is not mandatory.
You will get the money when the time comes if you have taken part in the system, like may be work.
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