Little Known Facts about Social Security Benefits, Part II

Spousal and Widow Benefits: In a marriage union where one spouse earns a lot less than the other. The spouse with the lesser earnings can collect benefits based on the higher earnings history  of  the two. Or one spouse can choose to get the larger part of their own or 50.0%  of the other spouse PIA. The lower earner is not eligible until the higher earner starts collecting benefits, but both can begin drawing social security benefits at age 62.

The Sustainability of social security: according to the many studies about the Social Security Trust Fund, coverage for retirement and disability obligations should be safe for the next 30 years. After that period it is speculated there will be a short fall of 22.0% . The Special Senate Committee on Aging has estimated the short fall will occur in 2037.

The Social Security Trustees is assuming an annual rate of inflation of about 2.8 %. The historic school of thought within the circles of social security is anticipating the rate to be, in excess, of  a full 3.0%. This is a huge number considering the total amount talked about is in the trillions of dollars.

That being said, there are some current notions surfacing,  if some small adjustment are made now to bring the trust fund to fully fundable status in could be more manageable. However, any delay will be more painful and detrimental. Come 10-20 years from now the short fall shall be much larger and will be bursting through the roof in the not to distant future.

Where Do Payroll Deduction Go for Social Security?-Well the original intent, it was to be held in trust by the government. But it’s not as if the money is sitting there in the trust fund waiting for Americans to retire and start collecting.

Here is a Sense of the Disbursements of the Social Security Trust Fund:

>Current beneficiaries are paid that are  owed

>Surplus dollars are used to buy bonds from the Treasury Department. Therefore, the trust holds the bonds, but the money is in the US Treasury. And guess who has access for the use of the money for any and every purpose. If you thought elected officials, you are right. The US Congress has total access for the use of the money held by the US Treasury. When the money is taken out-the US Congress put in I.O.U’s. So the US Treasury is simply holding paper.

This year mark the first time that social security had to cash-in on those bonds to cover payroll, according to Richard Stumpf, principal at Financial Benefits, an auditor in Wichita, Kansas. Therefore, it is expected that an increasing request will be sent  for those bonds to be pull away each year. To meet that demand, Congress will be charged with the responsibility to meet the monetary demand.