<p>Not that I begrudge ClassOf2015’s husband his cut, but in general this rule has mystified me. Why should a non-working spouse get anything? DH & I have both fully funded our share, so why does a non-working spouse get to share the benefit without ever paying in?</p>
<p>Just one of those “life is not fair” things I guess.</p>
<p>in Texas it depends on the school district whether or not you pay into and receive SS benefits. I am glad to have worked for one of the few districts that pay into both TRS and SS, and now have moved to a city workforce that has proportionate share benefits with city retirement and TRS. Even still, the multiplier for TRs benefits is so low, I will not be rolling in money!!!</p>
<p>thumper–they say that because you are working…the homemaker qualifies based on husband’s work history.</p>
<p>One thing I just found out that I wasn’t aware of, if a non-working parent dies that doesn’t have qualifying quarters, the minor children are not eligible for SS death benefits unless the other parent is receiving SS already. A good reminder to make sure you have life insurance on non-working parents too.</p>
<p>Good point, mncollegemom.</p>
<p>We had this happen in my town - three small children, non-working spouse passes away, no life insurance, and the working spouse was in a big financial bind because he could now not afford the child care costs for the three small kids.</p>
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<p>I am a Federal government retiree and eligible for SS. I contributed to SS before I began working for the government and afterwards. I began collecting SS at my full time retirement age but at a substantially reduced rate because of my Federal pension. My wife is also a Federal retiree, but if she works until 12.31.2014 she will collect a full SS retirement on top of her Federal pension, no reduction. You are not subject to the reduction if you are under SS for a substantial amount of time during your work years. Not sure of the time. Based on my wife’s contributions before her Federal employment, during her Federal employment (yes, but not FERS, I’ll explain that), and subsequent to her retirement she will receive a full SS payment. </p>
<p>Here’s how that happened. My wife started contributing to Federal Civil Service retirement when she was employment by the DC government, and their employees were still under Civil Service retirement. When she took a position in the Federal government she was placed in a system called Civil Service offset where she contributed both to SS and Federal retirement. This was some kind of transition system between Civil Service retirement and FERS. Only 300,000 people are in that system. Because of this she’ll have 30 years or so of contributions to SS and thus no reduction in her benefits or so SS has told us.</p>
<p>Neat? I wonder how this impacts me as her spouse, and what affect it has on my reduced SS benefits.</p>
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<p>The rule was written a very long time ago to protect stay at home moms (homemakers). Here is the problem with they way you are thinking ‘thisisallnewtome’…what if ‘Classof2015’ makes four times as much as you and your husband together. She would be “capped” at maximum amount and you might be also, but she would have paid far more into the system than you did. I believe the thought process behind the rule was that SAHP (stay at home parents) made it possible for their respective spouse to work in an unlimited way. And there are many cases where a man or a women with a stay at home spouse make high dollar incomes (and at times it is due to the fact that they have amazing flexibility in the area of travel, ability to work long hours, etc) </p>
<p>Without getting into political views, the system is what it is. But to say you and your husband pay in and that it is “not fair” for another couple, one who paid, one who didn’t to both claim benefits, is simply short sighted without complicated information of $'s paid in per “coupled unit.”</p>
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<p>Mnmom…I’m sure there is a reason you directed this comment to me…but I’m not sure what it is.</p>
<p>I will NEVER qualify for any SS benefits under my husband’s SS allocation (except that little death benefit) because I was a career public school teacher in CT.</p>
<p>thumper–I directed that comment to you because of this comment you made
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<p>collegeshopping – good point</p>
<p>and FWIW, my spouse is not “non-working” – he actually works all the time, but his work is not appreciated by the marketplace so he earns zero dollars from it. I vew our situation as analogous to a man who is the breadwinner and the wife is writing a novel or short stories. She is working, but if she doesn’t sell any of her stories, she earns no income.</p>
<p>So is the consensus that as long as I’m working and not taking benefits, my husband can not receive benefits? But when I start taking SS benefits, he could get 50% of what I receive? That’s what it sounds like.</p>
<p>Unless he becomes disabled, yes, you are correct.</p>
<p>Got it MN…we were talking about two different things.</p>
<p>mncollegemom – what would happen if he became disabled? Don’t worry – he won’t suddenly have an accident. :)</p>
<p>Classof2015…I know your husband in not “non working” I was simply sighting an example one person vs two in SS system contributions.</p>
<p>It depends is the best answer, 2015. Does he have private Disability insurance? If so, that would kick in first. If he is permanently disabled and meets the criteria, he would qualify for Social Security Disability Income which is very difficult to qualify for and a pain in the rear to process the paperwork for, which is why you should have a private disability plan–easier to qualify for and easier paperwork.</p>
<p>collegeshopping – I know you didn’t say it – you were just quoting the other poster.</p>
<p>mncollegemom – good point – he has no disability insurance – and I’ve heard proving permanent disability is tough. </p>
<p>But I definitely learned something. Thank you all who posted. Next thread – how to plan your own funeral! (kidding)</p>
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Your mistake is in thinking of Social Security as a traditional retirement vehicle like a pension.</p>
<p>It’s not, it’s an entitlement program that is funded by a separate tax that gives it the illusion of being like a pension, where the benefit is loosely tied to the amount of tax you paid. </p>
<p>Unlike a pension, you have no vested interest, Congress can change or eliminate (although blood would run in the streets if they tried to eliminate it - it would be political suicide) your benefit merely by changing the law, and this year’s benefits are paid largely from this year’s tax receipts, not from the investing of past years’ taxes (this is the “pyramid scheme” aspect you hear some people talk about).</p>
<p>It’s welfare for old people, to be politically incorrect about it.</p>
<p>If you are under 50, on average your lifetime “return” on your “investment” will be less than zero - that is, you will not even get back the taxes you paid in. Any legitimate pension with this kind of return would result in a huge scandal.</p>
<p>I fully expect SS to be means-tested by the time I hit retirement age. Hopefully I will get something.</p>
<p>Once you understand that SS is <em>not</em> a pension, certain things like benefits to non-working spouses make more sense.</p>
<p>Classof2015 does he have revenue from his business but no profit?</p>
<p>I think of SS as more of a safety net than welfare. It’s original purpose was to solve the problem of destitute elderly citizens. It is also a form of insurance for widows and minor children of working people who die prematurely. </p>
<p>The taxes that go to fund SS are whopping. If you include Medicare and the employer’s contribution, it is 15%, starting with the first dollar earned and going up to a cap which I believe is now slightly over $100k, with no deductions or exemptions. The “full retirement” age has increased slightly.</p>
<p>SS is very well-funded, thanks to Ronald Reagan, who understood the problem that was coming - increased numbers of retirees per working person - and increased the SS tax so that there is now a large “trust fund” - the one that Al Gore wanted to put in a “lockbox.” The “trust fund” is invested in the most secure and stable vehicle possible: US Treasuries. The SS trust fund is treated like general revenue and spent. Not honoring the “trust fund” would mean defaulting on US Treasuries, certainly unthinkable. </p>
<p>I think there will have to be some modifications of SS - means testing makes a lot of sense - but the system is on a sound footing for the foreseeable future. (Medicare is not, but that’s another thread…)</p>
<p>tom1944 – that’s correct. He either has zero revenue (but still has expenses) or very small revenue (but expenses exceed revenue). For the past 10+ years, he has shown a net loss.</p>
<p>someone doesn’t pay in but is eligible for benefits. someone has paid in and is not. i am going to have to sue the state of illinois.</p>