Social Security and Medicare

2560 Words Apr 23rd, 2012 11 Pages
Social Security and Medicare

History
Present Configuration
Future Projection

GERO100
March 31, 2012

Hopefully we will all be physically able to work until the age of 65, collect retirement and Social Security and live an enriching life until we leave this world. Not all companies financially support their employees with fully funded retirement plans so it is left up to the individual to actively participate in saving for their future. When someone reaches retirement age, if the finances are there, they are usually only a fraction of what they were making as a full-time employee. This is when one hopes of having Social Security and Medicare benefits to supplement our retirement income for a more stable financial future.
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The hopes were with enhanced programs, the disabled would be able to return to the workforce. With the introduction of the Senior Citizens’ Freedom to Work Act of 2000, retirement age individuals were able to continue to work at their full retirement age and still receive benefits. The Medicare Prescription Drug, Improvement and Modernization Act of 2003 added the voluntary prescription drug program under the Medicare program. With the No Social Security Benefits for Prisoners Act of 2009, prisoners were prohibited from collecting social security benefits while they were in prison or in violation of parole or probation. The most recent change enacted to the Social Security program was the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010. This Act instituted a 2% reduction in employee’s payroll taxes. (www.ssa.gov/history)
The state of our current Social Security program is that there are fewer workers to fund the Social Security program through payroll taxes due to the decrease in number of birth rates per woman. Simple math shows that less people to contribute equals less money being funded. Social Security payroll taxes were just reduced from 6.2% to 4.2% per worker. To be eligible to receive Social Security benefits, you must earn 40 “credits” which is equivalent to 10 years of working. The monthly retirement benefit amount is based on the retired workers lifetime earnings.

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