I received a letter the other day from
the Social Security Administration. It was a helpful six page
statement explaining social security, and the particular benefits I
would receive at full retirement age. I was a bit surprised, and
wondered if they regularly send these to who have recently turned 29
½.
As I read the pamphlet, there was
something which caught my attention. How the SSA determines the
value I'll receive at retirement. I suppose I had always assumed the
amount one receives from social security is the same for everyone.
Or if not that, then more goes to people who have less.
But it's the opposite.
A
person's monthly payment upon retirement is based on their pay during
their life. Specifically, SSA accounts the 35 highest yearly
salaries of a person's lifetime. It adjusts those numbers for
inflation and then runs them through a special
formula. For every year short of the 35 required, the SSA
inserts a nice round 0 into the average!
In a county where a quarter
of mothers care for children at home
(and
an increasing number of fathers), it's incredible there isn't
a provision which sufficiently fixes this problem. The only solution
offered to parents who provide their own childcare, is the spousal
benefit. This rule is only applicable for spouses, and
allows a person (fortunately man or woman) to collect either their
own benefits, or half their spouse's benefits, but only after their
spouse has started to collect. Th
Until recently there was provision
allowing the 50% spouse to take her amount when the household earned
reached retirement age, but put off his collection. Unfortunately,
while this would have been beneficial for those who needed it, those
who didn't took advantage of it, and it was removed in 2015.
Together, these demonstrates the lack
of regard the United States for families dedicated to personally
caring for their children. Instead it induces parents to stuff their
kids into daycare as soon as possible, and get back to work. If
anyone doesn't believe stay at home parents deserve better, they
probably should stop reading this blog.
Even the concept that social security
is determined by how much one has earned, doesn't make sense. The
more one has earned (and presumably saved), the less one should need
the safety net to secure their retirement. As of 2015, if one earned
a salary of 118,500 for 35 years, they would receive the maximum
monthly benefit of $2,663. Someone who earns that amount shouldn't
be collecting the same as someone who has struggled through low wage
jobs their entire life.
Of course, maybe we won't be able to
retire until we're 90 anyways.
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