Social Security
The Social Security Act was created by Congress and signed into law by President Franklin D. Roosevelt in 1935. This landmark legislation was spurned in large part due to the terrible Great Depression and the slow and difficult economic recovery the United States experienced during the 1930s. Under the Social Security Act, the Social Security Administration was created to oversee the various provisions and requirements of the 1935 Act. Since that time the Administration has grown into one of the largest and most expensive areas of overall federal spending by the United States government. For example, the Social Security Administration paid out more than $500 billion in various benefits in the year 2004 alone. We’ll provide a brief overview of how benefits work through Social Security (sometimes listed herein as “Soc Sec”) and list some of the major programs the Administration oversees.
Overview
The Social Security Act of 1935 mandated that each American receive a Social Security Number (“SSN”). The SSN was only initially intended to be used to track the availability of various benefits offered by the Administration. Millions of Social Security Cards were printed by the end of 1935 and hundreds of millions more have been created since that time. It is important to keep track of your SSN. If at any time you realize you have a lost Social Security card, contact your local Social Security Office to replace it.
To pay for the benefits offered by the Administration a “Social Security tax” was created. It is listed as “FICA” on your typical paycheck but those funds are used to generate enough cash to pay out the massive amount of benefits owed by the federal government under this program each year. The spending under this program represents a massive portion of the national budget annually. Recent estimates show that more than 40% of all expenditures by the federal government were related to Social Security. In 2008 alone this amounted to more than 50,000,000 Americans receiving benefits that added up to more than $615,344,000,000.
Programs Offered
The biggest and most well known program offered by the Administration are retirement benefits. Year in and year out, most workers pay social security taxes to the federal government with the expectation that they will receive some type of retirement benefit when they reach a predetermined retirement age. Current retirement ages vary based upon the year you were born and range from age 65 (for people born before 1938) to age 67 (for people born on or after 1960).
Disability benefits are also offered through Soc Sec for people who are expected to not work for at least a year or have a condition that will result in their death. The Administration has strict requirements on who can qualify for disability benefits and it keeps a handbook of conditions (both physical and mental) that will result in your disability benefit application being approved or denied.
For more questions on how Social Security works, contact your local Social Security office or go online to the Administration’s website.
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