11

22

33

1935Retirement Insurance

1935Retirement Insurance

History - Social Security’s ProgramsHistory - Social Security’s Programs

1956Disability Insurance

1956Disability Insurance

1939Survivors Insurance

1939Survivors Insurance

44

Other ProgramsOther Programs

1965Medicare

1965Medicare

1972Supplemental

Security Income

1972Supplemental

Security Income

2003Medicare

Part D

2003Medicare

Part D

55

A Foundation for Planning Your FutureA Foundation for Planning Your Future

55

66

3-Legged Stool of Retirement Security3-Legged Stool of Retirement Security

77

Social Security is the foundation for a comfortable retirement,

but you also will need other savings and investments.

If you want to learn more about how and why to save,

visit www.mymoney.gov.

Social Security is the foundation for a comfortable retirement,

but you also will need other savings and investments.

If you want to learn more about how and why to save,

visit www.mymoney.gov.

Save for a Secure FutureSave for a Secure Future

88

50 million people50 million people

Who Gets Benefits from Social Security?Who Gets Benefits from Social Security?

31.5 million Retired Workers2.9 million Dependents

7.1 million Disabled Workers, 1.8 million Dependents

4.6 millionWidows/ Widowers

1.9 millionChildren of

Deceased Workers

2/20082/2008

99

Payments to

Beneficiaries

Workers&

Employers

Who Pays for Social Security?Who Pays for Social Security?

1010

Ch

ild

ren

Per

Wom

anU.S. Birth Rate 1920-2020U.S. Birth Rate 1920-2020

1111

Why Are Changes Needed?Why Are Changes Needed?

The Number of Workers Per Beneficiary Is Decreasing

5 3 21960 2007 2030

The Number of Workers Per Beneficiary Is Decreasing

5 3 21960 2007 2030

1212

America Is Getting OlderU.S. Population Age 65 & Older

America Is Getting OlderU.S. Population Age 65 & Older

11 Million

1946(7% of totalpopulation)

38 Million

2007(12% of totalpopulation)

70 Million

2030(19% of totalpopulation)

1313

Life Expectancy for Those Age 65 TodayLife Expectancy for Those Age 65 Today

Men Women

U.S. Population 81 85

White 80 84

African Americans 79 83

Hispanic 85 88

Asian 84 88

American Indians 84 88

Men Women

U.S. Population 81 85

White 80 84

African Americans 79 83

Hispanic 85 88

Asian 84 88

American Indians 84 88

1414

Social Security Cost-of-Living AdjustmentsSocial Security Cost-of-Living Adjustments

Effective Date Amount

June 1975 8%June 1976 6.4%June 1977 5.9%June 1978 6.5%June 1979 9.9%June 1980 14.3%June 1981 11.2%June 1982 7.4%Dec 1983 3.5%Dec 1984 3.5%Dec 1985 3.1%Dec 1986 1.3%Dec 1987 4.2%Dec 1988 4%Dec 1989 4.7%Dec 1990 5.4%Dec 1991 3.7%

Effective Date Amount

June 1975 8%June 1976 6.4%June 1977 5.9%June 1978 6.5%June 1979 9.9%June 1980 14.3%June 1981 11.2%June 1982 7.4%Dec 1983 3.5%Dec 1984 3.5%Dec 1985 3.1%Dec 1986 1.3%Dec 1987 4.2%Dec 1988 4%Dec 1989 4.7%Dec 1990 5.4%Dec 1991 3.7%

Effective Date Amount

Dec 1992 3%Dec 1993 2.6%Dec 1994 2.8%Dec 1995 2.6%Dec 1996 2.9%Dec 1997 2.1%Dec 1998 1.3%Dec 1999 2.5%Dec 2000 3.5%Dec 2001 2.6%Dec 2002 1.4%Dec 2003 2.1%Dec 2004 2.7%Dec 2005 4.1%Dec 2006 3.3%Dec 2007 2.3%Dec 2008 5.8%

Effective Date Amount

Dec 1992 3%Dec 1993 2.6%Dec 1994 2.8%Dec 1995 2.6%Dec 1996 2.9%Dec 1997 2.1%Dec 1998 1.3%Dec 1999 2.5%Dec 2000 3.5%Dec 2001 2.6%Dec 2002 1.4%Dec 2003 2.1%Dec 2004 2.7%Dec 2005 4.1%Dec 2006 3.3%Dec 2007 2.3%Dec 2008 5.8%

1515

Example: Worker with averagepre-retirement income of $30,000

(Retiring at age 66 in 2009)

1st Year of Retirement

Pension $13,000/ 50%

Social Security $13,000/50%

Inflation 3% per year

Example: Worker with averagepre-retirement income of $30,000

(Retiring at age 66 in 2009)

1st Year of Retirement

Pension $13,000/ 50%

Social Security $13,000/50%

Inflation 3% per year

Value of Inflation ProtectionValue of Inflation Protection

1616

Value of Inflation ProtectionValue of Inflation Protection

example continued:

Worker with averagepre-retirement

income of $30,000

example continued:

Worker with averagepre-retirement

income of $30,000

5th Year of RetirementPension $13,000/47%

Social Security $14,632/53%

10th Year of RetirementPension $13,000/43%

Social Security $16,962/57%

20th Year of RetirementPension $13,000/36%

Social Security $22,796/64%

5th Year of RetirementPension $13,000/47%

Social Security $14,632/53%

10th Year of RetirementPension $13,000/43%

Social Security $16,962/57%

20th Year of RetirementPension $13,000/36%

Social Security $22,796/64%

1717

Payments to Today’s BeneficiariesPayments to Today’s Beneficiaries

Reserves for FutureBeneficiariesReserves for FutureBeneficiaries

Administrative CostsAdministrative Costs

How Is Social Security Income Spent?How Is Social Security Income Spent?

73.8%

25.4%

0.7%0.7%

1818

Where Does the Money Come From?Where Does the Money Come From?

Payroll Tax 84%

Trust Fund Interest 14%

Taxation of Benefits 2%

Payroll Tax 84%

Trust Fund Interest 14%

Taxation of Benefits 2%

Social Security Trust Fund 2006Social Security Trust Fund 2006

1919

In 2016, Social Security Will Begin PayingMore in Benefits than is Collected in TaxesIn 2016, Social Security Will Begin PayingMore in Benefits than is Collected in Taxes

1919

2020

Social Security Trust Funds will be Exhausted in 2037

Social Security Trust Funds will be Exhausted in 2037

2020

At exhaustion in 2037,only about 76% of

benefits could be paid.

At exhaustion in 2037,only about 76% of

benefits could be paid.

2121

You Need to Work to Earn Social Security CreditsYou Need to Work to Earn Social Security Credits

Each $1,120 in earnings gives you one credit

You can earn a maximum of 4 credits per year

Example: To earn 4 credits in 2011, you must earn at least $4,480 (2011 = $1120 x 4 = $4480). Earning 40 credits throughout your working life will qualify you for a retirement benefit.

Each $1,120 in earnings gives you one credit

You can earn a maximum of 4 credits per year

Example: To earn 4 credits in 2011, you must earn at least $4,480 (2011 = $1120 x 4 = $4480). Earning 40 credits throughout your working life will qualify you for a retirement benefit.

2222

Your Age When You Retire Affects Your BenefitsYour Age When You Retire Affects Your Benefits

If You’re A Worker and Retire

At age 62, you get a lower monthly payment permanently At your full retirement age, you get your full benefit You get an even higher monthly payment if you work past your full retirement age

2323

In Addition to the Retiree,Who Else Can Get Benefits?In Addition to the Retiree,

Who Else Can Get Benefits?

Your Spouse

At age 62 At any age if caring for child under 16 or disabled Divorced spouses may qualify

Your Child

Not married under 18 (under 19 if still in high school) Not married and disabled before age 22

2424

Full Retirement AgeFull Retirement Age

Year of Birth Full Retirement Age

1937 65

1938 65 & 2 months

1939 65 & 4 months

1940 65 & 6 months

1941 65 & 8 months

1942 65 & 10 months

1943 – 1954 66

1955 66 & 2 months

1956 66 & 4 months

1957 66 & 6 months

1958 66 & 8 months

1959 66 & 10 months

1960 & later 67

Year of Birth Full Retirement Age

1937 65

1938 65 & 2 months

1939 65 & 4 months

1940 65 & 6 months

1941 65 & 8 months

1942 65 & 10 months

1943 – 1954 66

1955 66 & 2 months

1956 66 & 4 months

1957 66 & 6 months

1958 66 & 8 months

1959 66 & 10 months

1960 & later 67

2525

2626

How Social Security Determines Your BenefitHow Social Security Determines Your Benefit

Social Security benefits are based on earnings

Step 1 Your wages are adjusted for changes in wage levels

Step 2 Find the monthly average of your 35 highest earnings years

Step 3 Result is “average indexed monthly earnings”

2727

If your average monthly earnings are = $5,200Then your monthly benefit would be = $1,974

Average Monthly Earnings $5,200

90% of First $744 = $670

32% of Earnings over $744 through $4,483 $3,739 = $1,196($4,483-$744=$3,739)

15% of Earnings over $4,483 $717 = $108($5,200-$4,483=$717)

$5,200$1,974

If your average monthly earnings are = $5,200Then your monthly benefit would be = $1,974

Average Monthly Earnings $5,200

90% of First $744 = $670

32% of Earnings over $744 through $4,483 $3,739 = $1,196($4,483-$744=$3,739)

15% of Earnings over $4,483 $717 = $108($5,200-$4,483=$717)

$5,200$1,974

Retirement Benefit Computation ExampleRetirement Benefit Computation Example

2828

What You’ll Get at Full Retirement AgeWhat You’ll Get at Full Retirement Age%

of

earn

ings

LowEarner

AverageEarner

HighEarner

56%

41%

34%

2929

You Can Work & Still Receive BenefitsYou Can Work & Still Receive Benefits

In 2011 You Can If You Make More,If You Are Make Up To Some Benefits Will

Be Withheld

Under FullRetirement Age $14,160/yr. ($1180/mo.) $1 for every $2

The Year Full RetirementAge is Reached $37,680/yr. ($3140/mo.) $1 for every $3

Month of Full Retirement Age and Above No Limit No Limit

In 2011 You Can If You Make More,If You Are Make Up To Some Benefits Will

Be Withheld

Under FullRetirement Age $14,160/yr. ($1180/mo.) $1 for every $2

The Year Full RetirementAge is Reached $37,680/yr. ($3140/mo.) $1 for every $3

Month of Full Retirement Age and Above No Limit No Limit

3030

What Will You Need When Applyingfor Your Social Security Benefits?

What Will You Need When Applyingfor Your Social Security Benefits?

Social Security number for each applicant

Proof of age (birth certificate)

Latest W-2 or self-employment tax return

Earnings estimate

Bank information for direct deposit

Information about marriages/divorces

Information about military or railroad service

Social Security number for each applicant

Proof of age (birth certificate)

Latest W-2 or self-employment tax return

Earnings estimate

Bank information for direct deposit

Information about marriages/divorces

Information about military or railroad service

3131

Who Can Get Survivors Benefits?Who Can Get Survivors Benefits?

Widow or Widower:

Reduced benefits at age 60

If disabled as early as age 50

At any age if caring for child under 16 or disabled

Divorced widows/widowers may qualify

Your Child if:

Not married under age 18 (under 19 if still in high school)

Not married and disabled before age 22

Widow or Widower:

Reduced benefits at age 60

If disabled as early as age 50

At any age if caring for child under 16 or disabled

Divorced widows/widowers may qualify

Your Child if:

Not married under age 18 (under 19 if still in high school)

Not married and disabled before age 22

3232

Parents

Age 62 and was receiving atleast one-half support from deceased worker

Lump Sum Death Payment ($255)

Most spouses or children

Parents

Age 62 and was receiving atleast one-half support from deceased worker

Lump Sum Death Payment ($255)

Most spouses or children

Other Survivors BenefitsOther Survivors Benefits

3333

Social Security’s Disability Definition:Social Security’s Disability Definition:

A medical condition preventing substantial work for at least 12 months, or expected to

result in death. The determination also considers age, education & work experience.

A medical condition preventing substantial work for at least 12 months, or expected to

result in death. The determination also considers age, education & work experience.

3434

Who Can Get Disability Benefits?Who Can Get Disability Benefits?

Worker

Must have paid into Social Security five out of last 10 years

Spouse

At age 62 At any age if caring for child

under 16 or disabled Divorced spouses may qualify

Worker

Must have paid into Social Security five out of last 10 years

Spouse

At age 62 At any age if caring for child

under 16 or disabled Divorced spouses may qualify

3535

Who Can Get Disability Benefits?Who Can Get Disability Benefits?

Child

Not married under age 18 (under 19 if still in high school)

Not married and disabled before age 22

Child

Not married under age 18 (under 19 if still in high school)

Not married and disabled before age 22

3636

65 & older

-or-

Receiving Social Security disability benefits at least 24 months

-or-

Permanent kidney failure

-or-

Amyotrophic Lateral Sclerosis (ALS)

65 & older

-or-

Receiving Social Security disability benefits at least 24 months

-or-

Permanent kidney failure

-or-

Amyotrophic Lateral Sclerosis (ALS)

Who Can Get Medicare?Who Can Get Medicare?

3737

When Can I Sign Up for Medicare?When Can I Sign Up for Medicare?

Medicare Enrollment Periods: Initial - at age 65

Special - if still working

General - January-March

3838

Medicare CoverageMedicare Coverage

Part A Hospital Insurance Covers most inpatient hospital expenses.

2011 Deductible $1,132

Part B Supplementary Medical Insurance Covers 80% doctor bills & other outpatient medical

expenses after 1st $162 in approved charges.

2011 Standard Monthly Premium $115.40

Part D Medicare Prescription Drug Plan Covers a major portion of prescription drug costs

for Medicare beneficiaries.

2011 average Monthly Premium $32.34

Part A Hospital Insurance Covers most inpatient hospital expenses.

2011 Deductible $1,132

Part B Supplementary Medical Insurance Covers 80% doctor bills & other outpatient medical

expenses after 1st $162 in approved charges.

2011 Standard Monthly Premium $115.40

Part D Medicare Prescription Drug Plan Covers a major portion of prescription drug costs

for Medicare beneficiaries.

2011 average Monthly Premium $32.34

3939

Extra Help Could Further ReduceMedicare Prescription Drug CostsExtra Help Could Further ReduceMedicare Prescription Drug Costs

Extra help is available for low income beneficiaries to pay for part of the Medicare

Part D monthly premiums, annual deductibles and prescription co-payments. The extra help

could be worth more than $3,600 per year.

Go online to www.socialsecurity.gov to apply for extra help.

Extra help is available for low income beneficiaries to pay for part of the Medicare

Part D monthly premiums, annual deductibles and prescription co-payments. The extra help

could be worth more than $3,600 per year.

Go online to www.socialsecurity.gov to apply for extra help.

4040

For More InformationFor More Information

1-800-MEDICARE(1-800-633-4227)

www.medicare.gov

1-800-MEDICARE(1-800-633-4227)

www.medicare.gov

4141

Social Security AdministrationSocial Security Administration

Disability Programs

Disability Programs

4242

Types of Disability Programs

Social Security benefits for workers

Social Security benefits for adults disabled since childhood

Supplemental Security Income (SSI) for children and adults

4343

To qualify, the disabled person must have a recent work history

Special rules apply to younger persons who need less work to qualify

Social Security Disability Insurance

4444

The amount of work you need depends on your age at the time disability starts

Before age 24— 1-1/2 years of work in a three-year

period before becoming disabled

Age 24-31— work during half the time between age

21 and the time the disability began

Age 31 or older— work during five out of the 10 years

before the disability began

Work Requirements

4545

In 2011 it takes $1,120 to earn 1 work credit— $2,240 earns 2 work credits

— $3,360 earns 3 work credits

— $4,480 earns 4 work credits(maximum number of credits in 1 year)

Amount of earnings needed to earn a work credit changes every year

Work Credits

4646

Disability for an Adult (Over Age 18) Both Social Security and SSI

Must have a physical or mental impairment (or combination of conditions)

Inability to perform substantial work activity

Disability must be expected to last 12 consecutive months or result in death

We consider age, education and past work activity

4747

Medicare Coverage

You will automatically be enrolled in Medicare after being entitled to disability benefits for 24 months

We will send you information about Medicare several months before your coverage starts

NOTE: People who have permanent kidney failure requiring dialysis or a transplant or have amyotrophic lateral sclerosis (Lou Gehrig’s disease) may qualify for Medicare almost immediately

4848

Who Can Get SSI?

People with limited income and resources who are:

Supplemental Security Income (SSI)

• blind, at any age; or

• disabled, at any age; or

• age 65 or older

4949

Resource limits— $2,000 for individual

— $3,000 for couple

We count— bank accounts (CDs, IRAs)

— second car

— stocks and bonds, 401Ks

— liquid assets

— property other than where you live

SSI Benefits for Adults

5050

SSI Benefits for Adults

We don’t count as resources— home in which you live

— first car

— burial plots

— some resources set aside for burial

5151

Medicaid

People who qualify for SSI also qualify for Medicaid

Your local medical assistance office will contact you for additional information the agency needs for qualification

5252

The Application Process

There are several ways to apply for benefits: Visit our website at www.socialsecurity.gov

to apply online Call or visit any Social Security office to

schedule an appointment Contact us toll-free at 1-800-772-1213

(TTY 1-800-325-0778)

5353

The Application Process

When you apply for benefits, we will ask you to: Describe your disabling condition Give us information about where you have received

treatment for your disability Give us information about your medications Give us information about

your education and past work history

Authorize release of your records to be used in making the disability decision

5454

Advantages of Online Applications

When you apply for benefits online, you can: Complete the application forms at

your convenience Take several sessions to complete the forms Take advantage of online help Print a copy for your records before

submitting them

5555

What Happens Next

Social Security will forward your application to the state Disability Determination Services (DDS) agency

The DDS will contact your medical providers to obtain your medical records

The DDS may ask you to provide additional information about how your condition affects your daily activities

5656

And Then What?

If adequate information is available in existing records, along with your statements, the DDS will make a decision

The DDS may ask you to have a special examination at our expense if more information is needed about your disabling condition

5757

Quick Disability Determinations (QDD) Compassionate Allowances

National Hearing Center (NHC) Hiring 175 new Administrative Law Judges Increasing efficiency with automation and

improved business processes

How Social Security Is Improvingthe Disability Process

5858

What Should You Do toPrepare for Your Retirement?

What Should You Do toPrepare for Your Retirement?

Get estimates of benefits using different retirement ages and wage estimates

www.socialsecurity.gov

Get estimates of benefits using different retirement ages and wage estimates

www.socialsecurity.gov

5959

Visit Our Website or Call!

www.socialsecurity.gov-or-

1-800-772-1213TTY 1-800-325-0778

6060

Social Security’s Online ServicesSocial Security’s Online Services

Retirement & Disability Applications

Retirement/Survivors/Disability Planner

Medicare Card Replacements

Request a Statement

Request a Benefit Verification Letter

Change of Address

Retirement & Disability Applications

Retirement/Survivors/Disability Planner

Medicare Card Replacements

Request a Statement

Request a Benefit Verification Letter

Change of Address

6161

WWW.SOCIALSECURITY.GOV

6262

Retirement Estimator

6363

Retirement Estimator

6464

Retirement Estimator

6565

Retirement Estimator

6666

6767

6868

6969

7070

The Social Security StatementThe Social Security Statement

The Statement provides you with estimates of monthly Social Security retirement, disability and survivors benefits

The Statement allows you to check your earnings history for accuracy

The Statement provides you with estimates of monthly Social Security retirement, disability and survivors benefits

The Statement allows you to check your earnings history for accuracy

7171

Questions??

Emily ChambersClaims Representative

Emily.Chambers@ssa.gov(877)512-3854x14416 office