If you are looking to file for Social Security benefits, it is best to first schedule a consultation with your Greensboro disability Social Security disability claims law firm. Receiving retirement benefits from the Social Security Administration (SSA) is something that every tax paying American is entitled to once they reach the age for retirement. However, with the recent changes in the economy, Social Security retirement benefits are changing. The following is information from your Greensboro disability Social Security disability claims law firm about how the Social Security benefits process works and how you may be impacted by the changes.
How Does Social Security Work
When you receive a paycheck for working, you are also paying taxes to the federal government which you will see on your pay stub. A portion of these taxes are going into Social Security which helps to fund retirement benefits that you will also be entitled to at an older age or if you become disabled. How much you will receive in Social Security benefits can depend on several factors, such as:
- how much money you have made over the course of your work history
- the age that you decide to retire
- how many years you have worked at jobs that qualify for Social Security benefits
The more money that you make over the years, and the longer you wait to retire, typically means that you will receive more money in benefits when you do begin to collect them. Once you retire, you will not automatically receive benefits. You will need to apply through the SSA to start receiving them. This is something that you can have your Greensboro disability Social Security disability claims law firm help you with. Not only will you need to apply, you will need to have the proper amount of credits by the age of 62 in order to qualify to receive them.
The Workings of Retirement Benefits from the Social Security Administration
As discussed above, you are required to have the proper amount of credits before you can apply for retirement benefits from the SSA. You earn credits as you pay your Social Security taxes every year. These credits over the years are accumulated for you. The amount of credits you need to retire with Social Security benefits depend on the year of your birth. You will not be able to receive any retirement benefits if you stop working before you reach your required number of credits. However, you do not lose credits when you stop working either. You are able to return back to work and continue to accumulate and add to the credits that you already have. The SSA has statements that you are able to review on their website. These SSA statements will allow you to get an idea of what sort of benefits you may be entitled to when you are ready to retire. If you are currently over the age of 60, the SSA will mail a statement yearly to you. If you are not currently receiving benefits and under the age of 60, then the SSA will mail a statement to you every five years.
Are Social Security Benefits in Danger?
The Social Security benefits are in danger but not as much as everyone fears. Pretty soon the Social Security Administration will experience the biggest decline in worker-to-beneficiaries that it has ever seen. This drop is due to the baby boomer generation retiring, in addition to increasing life spans and the increase in the cost of living. When Social Security first started, the ratio of worker-to-beneficiary was about 15 to 1. These days that ratio is much closer to 3 to 1. It is predicted to lower even more in the near future. What this means is that there are fewer workers to put funds into the Social Security system and more money being distributed to beneficiaries. It is projected that the federal government will soon be paying out more in Social Security benefits then they are collecting taxes from payroll. This will not work unless there is money coming into the Social Security system some other way. It is estimated that the Social Security benefits fund will run out by the year 2037 if nothing is done. Even now, those who are retiring can expect to only get about three-quarters of what they are predicted to receive.
What You Can Expect If You Are About to Apply for Benefits
If you are due to retire soon, then you may not have anything to be concerned about regarding your Social Security retirement benefits. The issues stated above are more likely to affect the workers who are planning on retiring in the next ten years or more. Funds will not be cut for current retirees.
What to Expect for Retirement If You Are Currently 25-35-Years-Old
Changes will need to be made to the Social Security system in order for this age group to receive benefits once they retire. It is likely that by the time this age group is ready to retire that they can expect to see a 25% drop in benefits. The system may receive an overhaul before then however.
The Future of the Social Security Benefits Fund
Different professionals have different solutions and predictions about what will happen with the Social Security benefits fund over the next several decades. Those who have participated in an economic think tank have said that if drastic measures are not taken soon, then the whole bottom of the Social Security benefits fund will fall out. The Chairman of the House Budget Committee believes that recovery of the system will be slow, but positive changes can be made overtime to lift the system back up for those retiring in several decades. Small changes can be made now to help ensure the future of the Social Security funds that millions of Americans rely on in order to retire. The government is considering pre-funding the Social Security benefits fund, which is something the United Kingdom has done. They are also considering options that would benefit the system by raising taxes from payroll or taking funds from the general revenue.