1. By: Shannon Breedlove, Ayren Burns, Chris Sitzman, & Heather Taylor

2.  What is Social Security?  History of Social Security  Social Security Depletion Problem  Supplemental Plans for Social Security  American Social Security System Vs. European Social Security System  Conclusion

3.  National Academy of Social Insurance  “Pay-As-You-Go” Program  Taxpayers Pay In, Beneficiaries Receive  Health Care  Disability  Retirement

4.  157 Million Taxpayers  6.2% of Income from Employees/Employers  Tax-Deductible for Employers  56 Million Beneficiaries  39 Million Retirees & Family Members  10.8 Million Disabled Workers & Family  6.3 Million Survivors of Deceased Workers

5.  Social Security Act  Signed in 1935 by Franklin D. Roosevelt  First Taxes Collected in 1937  Continued Legislation Signed in 1939 for Survivors  Established During Times of War (WWII)  Early Retirement Benefits  Established for Women in 1956  Established for Men in 1961  Job Enrichment & Human Relations

6.  1972: Nixon’s 20% Cost-of-Living Adjustment  Also made the COLA automatic each year  1983: Reagan’s Taxation of Benefits  Initiated the gradual increase of retirement age  2000: Clinton Eliminates Retirement Earnings Test  Earnings Test required beneficiaries to give up partial benefits when earning in excess of a given amount  Applies only to beneficiaries above full-benefit age

7.  The Social Security Trust Fund began facing the threat of bankruptcy in the early 80s.  Again in early 90s, lawmakers, interest groups, and concerned citizens once again realized that Social Security was in trouble of depleting.

8.  Hot issue in the media and politics, and a major concern for the American public.  Fund will be exhausted if changes to the program are not made.  Estimated to deplete by 2037.

9.  Why Is It Depleting?  The growing budget deficit  Increased life expectancy  Inflation  Growing elderly population  The federal government’s “borrowing” of funds.

10.  How are recipients affected?  The System meets current demands of recipients, but people starting their careers within the next few years may never fully reap the benefits.  Benefits will continue to be paid after the fund is depleted, because taxpayers continue to pay taxes.  Revenues from the payroll tax will continue to provide enough cash flow to fund benefits at 75% of expected levels.  Future qualifiers may receive some money from the program, but it may not be enough to live on comfortably.

11.  How can the problem be solved?  Raising taxes  Lowering benefits  Combining actions  Privatization  Medicare and Medicaid reforms  Other measures

12.  Workers should plan for their future  Social security was never intended to be a primary income source, but rather a supplement to workers’ efforts.  Saving, investing, and structuring finances should alleviate the stress of a depleting fund.

13.  Social Security income typically amounts to less than half of a recipient’s income.  Retirement savings plans and pensions can provide the other income necessary to retire comfortably.

14.  Retirement plans can be funded by employers and employees or solely by the employer.  Many options are available such as:  Money purchase plans  Profit-sharing and employee stock ownership plans,  Section 401 (k) plans.

15.  With these plans, workers are encouraged to take matters into their own hands so that they will not have to rely solely on the government for money in the future.  Workers that plan for the future will greatly benefit by being able to retire comfortably.  Start planning NOW!

16.  Social security applies to national legislation on sickness, maternity, and equivalent paternity benefits, old-age pensions, pre-retirement, and invalidity benefits, survivors’ benefits and death grants, unemployment benefits, family benefits, and benefits in respect of accidents at work and occupational diseases.  Does not replace national systems  All countries are free to decide who is to be insured under their legislation.

17.  People earn entitlement to benefits such as cash benefits for sickness, unemployment, death of partner, retirement, etc. by paying National Insurance contributions to the National Insurance Scheme (NIS)  The National Health Service (NHS) provides medical, dental, and optical treatment which is free to people who live in UK and Northern Ireland.  National insurance number issued to Natives at age of sixteen.  Financing for UK’s social security is from national insurance contributions paid by employers and employees and general tax revenue.

18.  Sickness insurance, long-term care insurance, pension insurance, accident insurance, and unemployment insurance.  Provides State social support that provides basic provision for jobseekers, in old age, reduced earning capacity, and various family benefits and housing allowances.  Financed from national insurance contributions paid by employers and employees, and from general tax revenue.  The individual pays 53% of the contribution, employer pays 47%.

19.  Basis of Social Security  Supplemental Fund  Depletion Solutions  Raising Taxes  Lowering Benefits  Privatization  Modeling the European system?  Saving and Investing