1. 1 1

2. 2 2

3. 3 3 1935 Retirement Insurance 1935 Retirement Insurance History - Social Security’s Programs 1956 Disability Insurance 1956 Disability Insurance 1939 Survivors Insurance 1939 Survivors Insurance

4. 4 4 Other Programs 1965 Medicare 1965 Medicare 1972 Supplemental Security Income 1972 Supplemental Security Income 2003 Medicare Part D 2003 Medicare Part D

5. 5 5 A Foundation for Planning Your Future 5 5

6. 6 6 3-Legged Stool of Retirement Security

7. 7 7 Social Security is the foundation for a comfortable retirement, but you also will need other savings and investments. If you want to learn more about how and why to save, visit www.mymoney.gov. Save for a Secure Future

8. 8 8 50 million people Who Gets Benefits from Social Security? 31.5 million Retired Workers 2.9 million Dependents 7.1 million Disabled Workers, 1.8 million Dependents 4.6 million Widows/ Widowers 1.9 million Children of Deceased Workers 2/2008

9. 9 9 Payments to Beneficiaries Workers & Employers Who Pays for Social Security?

10. 10 Children Per Woman U.S. Birth Rate 1920-2020

11. 11 Why Are Changes Needed? The Number of Workers Per Beneficiary Is Decreasing 532 196020072030 The Number of Workers Per Beneficiary Is Decreasing 532 196020072030

12. 12 America Is Getting Older U.S. Population Age 65 & Older America Is Getting Older U.S. Population Age 65 & Older 11 Million 1946 (7% of total population) 38 Million 2007 (12% of total population) 70 Million 2030 (19% of total population)

13. 13 Life Expectancy for Those Age 65 Today MenWomen U.S. Population8185 White8084 African Americans7983 Hispanic8588 Asian8488 American Indians8488 MenWomen U.S. Population8185 White8084 African Americans7983 Hispanic8588 Asian8488 American Indians8488

14. 14 Social Security Cost-of-Living Adjustments Effective DateAmount June 19758% June 19766.4% June 19775.9% June 19786.5% June 19799.9% June 198014.3% June 198111.2% June 19827.4% Dec 19833.5% Dec 19843.5% Dec 19853.1% Dec 19861.3% Dec 19874.2% Dec 19884% Dec 19894.7% Dec 19905.4% Dec 19913.7% Effective DateAmount June 19758% June 19766.4% June 19775.9% June 19786.5% June 19799.9% June 198014.3% June 198111.2% June 19827.4% Dec 19833.5% Dec 19843.5% Dec 19853.1% Dec 19861.3% Dec 19874.2% Dec 19884% Dec 19894.7% Dec 19905.4% Dec 19913.7% Effective DateAmount Dec 19923% Dec 19932.6% Dec 19942.8% Dec 19952.6% Dec 19962.9% Dec 19972.1% Dec 19981.3% Dec 19992.5% Dec 20003.5% Dec 20012.6% Dec 20021.4% Dec 20032.1% Dec 20042.7% Dec 20054.1% Dec 20063.3% Dec 20072.3% Dec 20085.8% Effective DateAmount Dec 19923% Dec 19932.6% Dec 19942.8% Dec 19952.6% Dec 19962.9% Dec 19972.1% Dec 19981.3% Dec 19992.5% Dec 20003.5% Dec 20012.6% Dec 20021.4% Dec 20032.1% Dec 20042.7% Dec 20054.1% Dec 20063.3% Dec 20072.3% Dec 20085.8%

15. 15 Example: Worker with average pre-retirement income of $ 30,000 (Retiring at age 66 in 2009) 1st Year of Retirement Pension $ 13,000/ 50% Social Security $ 13,000/50% Inflation3% per year Example: Worker with average pre-retirement income of $ 30,000 (Retiring at age 66 in 2009) 1st Year of Retirement Pension $ 13,000/ 50% Social Security $ 13,000/50% Inflation3% per year Value of Inflation Protection

16. 16 Value of Inflation Protection example continued: Worker with average pre-retirement income of $ 30,000 example continued: Worker with average pre-retirement income of $ 30,000 5 th Year of Retirement Pension $ 13,000/47% Social Security $ 14,632/53% 10 th Year of Retirement Pension $ 13,000/43% Social Security $ 16,962/57% 20 th Year of Retirement Pension $ 13,000/36% Social Security $ 22,796/64% 5 th Year of Retirement Pension $ 13,000/47% Social Security $ 14,632/53% 10 th Year of Retirement Pension $ 13,000/43% Social Security $ 16,962/57% 20 th Year of Retirement Pension $ 13,000/36% Social Security $ 22,796/64%

17. 17 Payments to Today’s Beneficiaries Reserves for Future Beneficiaries Reserves for Future Beneficiaries Administrative Costs How Is Social Security Income Spent? 73.8% 25.4% 0.7%

18. 18 Where Does the Money Come From? Payroll Tax84% Trust Fund Interest14% Taxation of Benefits2% Payroll Tax84% Trust Fund Interest14% Taxation of Benefits2% Social Security Trust Fund 2006

19. 19 In 2016, Social Security Will Begin Paying More in Benefits than is Collected in Taxes In 2016, Social Security Will Begin Paying More in Benefits than is Collected in Taxes 19

20. 20 Social Security Trust Funds will be Exhausted in 2037 20 At exhaustion in 2037, only about 76% of benefits could be paid.

21. 21 You Need to Work to Earn Social Security Credits  Each $ 1,120 in earnings gives you one credit  You can earn a maximum of 4 credits per year Example: To earn 4 credits in 2011, you must earn at least $ 4,480 (2011 = $1120 x 4 = $4480). Earning 40 credits throughout your working life will qualify you for a retirement benefit.  Each $ 1,120 in earnings gives you one credit  You can earn a maximum of 4 credits per year Example: To earn 4 credits in 2011, you must earn at least $ 4,480 (2011 = $1120 x 4 = $4480). Earning 40 credits throughout your working life will qualify you for a retirement benefit.

22. 22 Your Age When You Retire Affects Your Benefits If You’re A Worker and Retire  At age 62, you get a lower monthly payment permanently  At your full retirement age, you get your full benefit  You get an even higher monthly payment if you work past your full retirement age

23. 23 In Addition to the Retiree, Who Else Can Get Benefits? In Addition to the Retiree, Who Else Can Get Benefits? Your Spouse  At age 62  At any age if caring for child under 16 or disabled  Divorced spouses may qualify Your Child  Not married under 18 (under 19 if still in high school)  Not married and disabled before age 22

24. 24 Full Retirement Age Year of BirthFull Retirement Age 193765 193865 & 2 months 193965 & 4 months 194065 & 6 months 194165 & 8 months 194265 & 10 months 1943 – 195466 195566 & 2 months 195666 & 4 months 195766 & 6 months 195866 & 8 months 195966 & 10 months 1960 & later67 Year of BirthFull Retirement Age 193765 193865 & 2 months 193965 & 4 months 194065 & 6 months 194165 & 8 months 194265 & 10 months 1943 – 195466 195566 & 2 months 195666 & 4 months 195766 & 6 months 195866 & 8 months 195966 & 10 months 1960 & later67

25. 25

26. 26 How Social Security Determines Your Benefit Social Security benefits are based on earnings Step 1Your wages are adjusted for changes in wage levels Step 2Find the monthly average of your 35 highest earnings years Step 3Result is “average indexed monthly earnings”

27. 27 If your average monthly earnings are= $ 5,200 Then your monthly benefit would be= $ 1,974 Average Monthly Earnings $ 5,200 90% of First $ 744= $ 670 32% of Earnings over $ 744 through $ 4,483 $ 3,739= $ 1,196 ( $ 4,483- $ 744= $ 3,739) 15% of Earnings over $ 4,483 $ 717= $ 108 ( $ 5,200- $ 4,483= $ 717) $ 5,200 $ 1,974 If your average monthly earnings are= $ 5,200 Then your monthly benefit would be= $ 1,974 Average Monthly Earnings $ 5,200 90% of First $ 744= $ 670 32% of Earnings over $ 744 through $ 4,483 $ 3,739= $ 1,196 ( $ 4,483- $ 744= $ 3,739) 15% of Earnings over $ 4,483 $ 717= $ 108 ( $ 5,200- $ 4,483= $ 717) $ 5,200 $ 1,974 Retirement Benefit Computation Example

28. 28 What You’ll Get at Full Retirement Age % of earnings Low Earner Average Earner High Earner 56% 41% 34%

29. 29 You Can Work & Still Receive Benefits In 2011 You CanIf You Make More, If You AreMake Up ToSome Benefits Will Be Withheld Under Full Retirement Age $ 14,160/yr. ( $ 1180/mo.) $ 1 for every $ 2 The Year Full Retirement Age is Reached $ 37,680/yr. ($3140/mo.) $ 1 for every $ 3 Month of Full Retirement Age and AboveNo LimitNo Limit In 2011 You CanIf You Make More, If You AreMake Up ToSome Benefits Will Be Withheld Under Full Retirement Age $ 14,160/yr. ( $ 1180/mo.) $ 1 for every $ 2 The Year Full Retirement Age is Reached $ 37,680/yr. ($3140/mo.) $ 1 for every $ 3 Month of Full Retirement Age and AboveNo LimitNo Limit

30. 30 What Will You Need When Applying for Your Social Security Benefits? What Will You Need When Applying for Your Social Security Benefits? Social Security number for each applicant Proof of age (birth certificate) Latest W-2 or self-employment tax return Earnings estimate Bank information for direct deposit Information about marriages/divorces Information about military or railroad service Social Security number for each applicant Proof of age (birth certificate) Latest W-2 or self-employment tax return Earnings estimate Bank information for direct deposit Information about marriages/divorces Information about military or railroad service

31. 31 Who Can Get Survivors Benefits? Widow or Widower:  Reduced benefits at age 60  If disabled as early as age 50  At any age if caring for child under 16 or disabled  Divorced widows/widowers may qualify Your Child if:  Not married under age 18 (under 19 if still in high school)  Not married and disabled before age 22 Widow or Widower:  Reduced benefits at age 60  If disabled as early as age 50  At any age if caring for child under 16 or disabled  Divorced widows/widowers may qualify Your Child if:  Not married under age 18 (under 19 if still in high school)  Not married and disabled before age 22

32. 32 Parents  Age 62 and was receiving at least one-half support from deceased worker Lump Sum Death Payment ( $ 255)  Most spouses or children Parents  Age 62 and was receiving at least one-half support from deceased worker Lump Sum Death Payment ( $ 255)  Most spouses or children Other Survivors Benefits

33. 33 Social Security’s Disability Definition: A medical condition preventing substantial work for at least 12 months, or expected to result in death. The determination also considers age, education & work experience. A medical condition preventing substantial work for at least 12 months, or expected to result in death. The determination also considers age, education & work experience.

34. 34 Who Can Get Disability Benefits? Worker  Must have paid into Social Security five out of last 10 years Spouse  At age 62  At any age if caring for child under 16 or disabled  Divorced spouses may qualify Worker  Must have paid into Social Security five out of last 10 years Spouse  At age 62  At any age if caring for child under 16 or disabled  Divorced spouses may qualify

35. 35 Who Can Get Disability Benefits? Child  Not married under age 18 (under 19 if still in high school)  Not married and disabled before age 22 Child  Not married under age 18 (under 19 if still in high school)  Not married and disabled before age 22

36. 36 65 & older -or- Receiving Social Security disability benefits at least 24 months -or- Permanent kidney failure -or- Amyotrophic Lateral Sclerosis (ALS) 65 & older -or- Receiving Social Security disability benefits at least 24 months -or- Permanent kidney failure -or- Amyotrophic Lateral Sclerosis (ALS) Who Can Get Medicare?

37. 37 When Can I Sign Up for Medicare? Medicare Enrollment Periods:  Initial - at age 65  Special - if still working  General - January-March

38. 38 Medicare Coverage Part AHospital Insurance  Covers most inpatient hospital expenses. 2011 Deductible $1,132 Part BSupplementary Medical Insurance  Covers 80% doctor bills & other outpatient medical expenses after 1 st $ 162 in approved charges. 2011 Standard Monthly Premium $ 115.40 Part DMedicare Prescription Drug Plan  Covers a major portion of prescription drug costs for Medicare beneficiaries. 2011 average Monthly Premium $ 32.34 Part AHospital Insurance  Covers most inpatient hospital expenses. 2011 Deductible $1,132 Part BSupplementary Medical Insurance  Covers 80% doctor bills & other outpatient medical expenses after 1 st $ 162 in approved charges. 2011 Standard Monthly Premium $ 115.40 Part DMedicare Prescription Drug Plan  Covers a major portion of prescription drug costs for Medicare beneficiaries. 2011 average Monthly Premium $ 32.34

39. 39 Extra Help Could Further Reduce Medicare Prescription Drug Costs Extra Help Could Further Reduce Medicare Prescription Drug Costs Extra help is available for low income beneficiaries to pay for part of the Medicare Part D monthly premiums, annual deductibles and prescription co-payments. The extra help could be worth more than $ 3,600 per year. Go online to www.socialsecurity.gov to apply for extra help. Extra help is available for low income beneficiaries to pay for part of the Medicare Part D monthly premiums, annual deductibles and prescription co-payments. The extra help could be worth more than $ 3,600 per year. Go online to www.socialsecurity.gov to apply for extra help.

40. 40 For More Information 1-800-MEDICARE (1-800-633-4227) www.medicare.gov 1-800-MEDICARE (1-800-633-4227) www.medicare.gov

41. 41 Social Security Administration Disability Programs Disability Programs

42. 42 Types of Disability Programs  Social Security benefits for workers  Social Security benefits for adults disabled since childhood  Supplemental Security Income (SSI) for children and adults

43. 43  To qualify, the disabled person must have a recent work history  Special rules apply to younger persons who need less work to qualify Social Security Disability Insurance

44. 44 The amount of work you need depends on your age at the time disability starts  Before age 24 — 1-1/2 years of work in a three-year period before becoming disabled  Age 24-31 — work during half the time between age 21 and the time the disability began  Age 31 or older — work during five out of the 10 years before the disability began Work Requirements

45. 45  In 2011 it takes $ 1,120 to earn 1 work credit — $ 2,240 earns 2 work credits — $ 3,360 earns 3 work credits — $ 4,480 earns 4 work credits (maximum number of credits in 1 year)  Amount of earnings needed to earn a work credit changes every year Work Credits

46. 46 Disability for an Adult (Over Age 18) Both Social Security and SSI  Must have a physical or mental impairment (or combination of conditions)  Inability to perform substantial work activity  Disability must be expected to last 12 consecutive months or result in death  We consider age, education and past work activity

47. 47 Medicare Coverage  You will automatically be enrolled in Medicare after being entitled to disability benefits for 24 months  We will send you information about Medicare several months before your coverage starts NOTE: People who have permanent kidney failure requiring dialysis or a transplant or have amyotrophic lateral sclerosis (Lou Gehrig’s disease) may qualify for Medicare almost immediately

48. 48 Who Can Get SSI? People with limited income and resources who are: Supplemental Security Income (SSI) blind, at any age; or disabled, at any age; or age 65 or older

49. 49  Resource limits — $ 2,000 for individual — $ 3,000 for couple  We count — bank accounts (CDs, IRAs) — second car — stocks and bonds, 401Ks — liquid assets — property other than where you live SSI Benefits for Adults

50. 50 SSI Benefits for Adults  We don’t count as resources — home in which you live — first car — burial plots — some resources set aside for burial

51. 51 Medicaid  People who qualify for SSI also qualify for Medicaid  Your local medical assistance office will contact you for additional information the agency needs for qualification

52. 52 The Application Process There are several ways to apply for benefits:  Visit our website at www.socialsecurity.gov to apply online  Call or visit any Social Security office to schedule an appointment  Contact us toll-free at 1-800-772-1213 (TTY 1-800-325-0778)

53. 53 The Application Process When you apply for benefits, we will ask you to:  Describe your disabling condition  Give us information about where you have received treatment for your disability  Give us information about your medications  Give us information about your education and past work history  Authorize release of your records to be used in making the disability decision

54. 54 Advantages of Online Applications When you apply for benefits online, you can:  Complete the application forms at your convenience  Take several sessions to complete the forms  Take advantage of online help  Print a copy for your records before submitting them

55. 55 What Happens Next  Social Security will forward your application to the state Disability Determination Services (DDS) agency  The DDS will contact your medical providers to obtain your medical records  The DDS may ask you to provide additional information about how your condition affects your daily activities

56. 56 And Then What?  If adequate information is available in existing records, along with your statements, the DDS will make a decision  The DDS may ask you to have a special examination at our expense if more information is needed about your disabling condition

57. 57  Quick Disability Determinations (QDD)  Compassionate Allowances  National Hearing Center (NHC)  Hiring 175 new Administrative Law Judges  Increasing efficiency with automation and improved business processes How Social Security Is Improving the Disability Process

58. 58 What Should You Do to Prepare for Your Retirement? Get estimates of benefits using different retirement ages and wage estimates www.socialsecurity.gov Get estimates of benefits using different retirement ages and wage estimates www.socialsecurity.gov

59. 59 Visit Our Website or Call! www.socialsecurity.gov -or- 1-800-772-1213 TTY 1-800-325-0778

60. 60 Social Security’s Online Services  Retirement & Disability Applications  Retirement/Survivors/Disability Planner  Medicare Card Replacements  Request a Statement  Request a Benefit Verification Letter  Change of Address  Retirement & Disability Applications  Retirement/Survivors/Disability Planner  Medicare Card Replacements  Request a Statement  Request a Benefit Verification Letter  Change of Address

61. 61 WWW.SOCIALSECURITY.GOV

62. 62 Retirement Estimator

63. 63 Retirement Estimator

64. 64 Retirement Estimator

65. 65 Retirement Estimator

66. 66

67. 67

68. 68

69. 69

70. 70 The Social Security Statement  The Statement provides you with estimates of monthly Social Security retirement, disability and survivors benefits  The Statement allows you to check your earnings history for accuracy  The Statement provides you with estimates of monthly Social Security retirement, disability and survivors benefits  The Statement allows you to check your earnings history for accuracy

71. 71 Questions?? Emily Chambers Claims Representative Emily.Chambers@ssa.gov (877)512-3854x14416 office