John J. Diak, CFP®
Social Security by the Numbers
Facts about the federal Old-Age, Survivors, and Disability Insurance (OASDI) program.
Social Security has been a pillar of retirement life for several decades, but how much do you really know about it? Here are some facts that might surprise you:
The Social Security trust fund exceeds the gross domestic product of every major economy in the world, except the nine largest: China, the European Union, the United States, India, Japan, Germany, Russia, Indonesia, and Brazil.(1)
For 61% of retirees, Social Security is a major source of income.(1)
Benefits are subject to federal income taxes, but it wasn’t always so. Amendments to the Social Security Act made benefits potentially taxable beginning in 1984.(1)
Benefits are determined by your average earnings during a lifetime of work, based on your 35 highest-earning years.(1)
If you receive Social Security, you no doubt welcome cost-of-living-adjustments (COLAs) to your benefits. Did you know that Social Security COLAs once required an act of Congress? That was the case before 1975, when they were finally pegged to advances in the Consumer Price Index.(1)
In the middle of 2018, more than 1 in 6 Americans were collecting Social Security benefits. Older Americans constitute about 80% of Social Security recipients, and their average monthly benefit in June 2018 was $1,413.(2)
When should you begin taking Social Security? That may depend on several factors, but many people choose to claim benefits as soon as they are eligible. You can receive benefits beginning at age 62, but you may choose to delay taking them. You can wait until age 70 to claim them, and if you take them before reaching Social Security’s Full Retirement Age (67 for those born in 1960 or later), your monthly benefit will be fractionally reduced. You may receive over one million dollars total in benefits across your retirement, so when and how you decide to take that income may be critical.(1,3)
This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.
1 - https://www.waddell.com/explore-insights/market-news-and-guidance/planning/9-facts-about-social-security [2/13/19] 2 - https://www.cbpp.org/research/social-security/policy-basics-top-ten-facts-about-social-security [8/14/18] 3 - https://www.ssa.gov/planners/retire/agereduction.html [12/13/18]