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Employees pay 1.2% of their gross salary below the social security threshold and employers pay 1.2% contribution on top of the salary paid to the employee. The contribution level was reduced from 1.3% for employees and employers during the COVID-19 pandemic.
There is an important distinction between income and wealth. Income refers to a flow of money over time, commonly in the form of a wage or salary; wealth is a collection of assets owned, minus liabilities. In essence, income is what people receive through work, retirement, or social welfare whereas wealth is what people own. [51]
Planning for retirement involves a multi-pronged strategy that takes into account how much money you have saved up in a 401(k) or similar plan as well as how much you can expect to get from Social...
If the break-even income would be $3000, after filing the tax report, family A would pay the tax on $1000 while family B would be entitled to receive, assuming the 50% NIT rate, $500. Meaning half of the difference between what they earn and the break-even income. Therefore, a family with $0 income would be entitled to receive $1500 in subsidy.
However, according to the federal reserve, "For most households, pensions and Social Security are the most important sources of income during retirement, and the promised benefit stream constitutes a sizable fraction of household wealth" and "including pensions and Social Security in net worth makes the distribution more even". [54]
Not including Social Security and Medicare, Congress allocated almost $717 billion in federal funds in 2010 plus $210 billion was allocated in state funds ($927 billion total) for means tested welfare programs in the United States, of which half was for medical care and roughly 40% for cash, food and housing assistance.
About 72 percent of Social Security disabled workers are between the ages of 50 and 66 and about 28 percent are under the age 50 (at Social Security's "full retirement age" (currently age 66), the Social Security Administration reclassifies disabled workers as retired workers). Twenty-four percent of disabled workers are African American. [14]
Retirement funding education is a big factor that affects the success of an individual's retirement experience. Social Security plays an important role because most individuals solely rely on Social Security as their only retirement option, when Social Security's trust funds are expected to be depleted by 2034. [23]
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