Issues In Social Security

One of the major concerns on most senior minds, is the fear of either outliving their money or just not having enough to enjoy life in the golden years. We know the issues with Social Security and even if our finances were properly managed it looks like it will be difficult to make ends meet, the fact is that many boomers are living beyond their means. Debt is at an all-time high in this country. The crisis in the mortgage industry is impacting many home owners largest asset, there home and the equity, having those fears are real and justified for the boomers.

One of the most important things we can do is manage or virtually eliminate debt, we need to save more and start building equity for the future this is very important. Why? Having such a plan can mitigate our fear about out living our money. The equity in your home can be the ticket and can make the difference.

When the time is right senior homeowners with equity, can tap into it with a reverse mortgage. They can have access to these funds with a lump sum, a credit line, or monthly income and there will be no burden of making mortgage payments. The money derived from the reverse mortgage along with social security, perhaps some personal investments and savings can ensure the quality of life that the boomers have been accustomed to most of their lives.

With a reverse mortgage, the debt can never exceed the value of your home, so none of the debt will pass on to heirs. Heirs will inherit the remaining equity in the home. But the amount of equity is diminished by the debt.

Those who have experience the Great Depression feel there primary asset was their home and that the home was something that needed to be passed on to the next generation.

I don't necessarily feel that way in the case of the future generations. They will be using the equity to travel or to meet their own personal needs rather than pass it on to the children.

There's no reason not to pursue your dreams, life is too short. If you're a homeowner 62 or older, a reverse mortgage may help you do some of the things that you have only dreamed about.

Benefits Of Social Security System

In order to address the routine concerns of many, regarding the payment of bills post-retirement or disability, a federal benefits program was designed in the United States, in 1935, known as the Social Securities Act. The program known as the social security program provides disability, retirement, unemployment and survivor benefits and Medicare. The benefits offered aim at providing financial support to the citizens of the U.S., who fall under the categories specified within the paradigms of the program.

The Social Security Act of 1935 introduced the social security system in the US. The system caters to the financial needs of the retired citizens, who have contributed to the social security trust fund for at least 10 years. It also provides benefits to the survivors, in event of the employee’s death. The other benefits offered cover disability and unemployment.

It is essential for the person to make the regular required contribution to the Social Security Trust Funds through the payroll taxes, to be eligible. By virtue of the provisions of the Federal Insurance Contributions Act or FICA, every worker’s income is subject to a tax payment of 12.4% on the first $94,200 earned during the year. Half of this amount or 6.2% is paid by the employer, while the other 6.2% is deducted from the salary of the employee. The amount is given to the government. Self-employed people are responsible for paying the full 12.4%. This amount is used fund the social security system.

The system has been designed to benefit those who make the necessary contributions for a period of ten years. There is a credit system incorporated in the scheme and you can earn a maximum of four credits per year. This means that irrespective of the higher limit of your actual earnings and consequently the quantum of your contribution to the fund, your earnings would entitle you to receive four credits.

The amount of the monthly social security check that you would receive after retirement would be calculated on the basis of your 35 highest income-generating years. You need to apply, to start receiving you social security benefits. The best time to do this would be a few months before your actual retirement date.

The social security program attempts to pay the retired citizens a pre-determined sum of money, to cover their basic needs. It works as a kind of insurance for the retired people, helping them to cope with financial difficulties, post-retirement.

It is a form of insurance that covers the surviving spouse and children, in case of the employee’s death. If the spouse is between 62 to 65 years, 70 to 99 percent of the benefits are payable. Dependent parents and unmarried children under 18 years are entitled to receive the benefits too.

Disability that prevents employment opportunity is also considered for benefits under the social security system. Physical and mental disabilities are also covered and the payment starts five months after proving the disability to the authorities.

Under the social security system, unemployment benefits are available to those whose unemployment is due to circumstances beyond their control. The program is designed to provide financial relief to the citizens of the U.S. at crucial times.