Social Security for retirees
I am living in Australia but was reading about the American social security system for retirees.
Apparently you can draw retirement at 62yrs but receive less than if you wait until you are 65yrs. My question is do you have to pay into it like the British system while you are working with insurance stamps. Or is it taken out of the tax you have paid while working, like the Australian system, which is means tested. |
Re: Social Security for retirees
You pay in while working, 40 quaters is required.
The reality of course is that you are paying the SS for current retirees, and people working when you retire are paying yours (if it still exists then!) |
Re: Social Security for retirees
You pay while you are working.
A lot of people depend on it, and one of the great fears of the Millennial generation is that it won't be there when we retire. As civilservant said 40 quarters is the minimum but you won't get much if that's all you pay in. They average your income over 40 years and then drop your 10 worst years - so if you have only 40 quarters that is 20 years they will count as "zero." |
Re: Social Security for retirees
Originally Posted by black swan
(Post 12239482)
I am living in Australia but was reading about the American social security system for retirees.
Apparently you can draw retirement at 62yrs but receive less than if you wait until you are 65yrs. My question is do you have to pay into it like the British system while you are working with insurance stamps. Or is it taken out of the tax you have paid while working, like the Australian system, which is means tested. Yes, there's a tax called FICA, separate from income tax, the equivalent of UK NI contributions (stamps as was.) |
Re: Social Security for retirees
Originally Posted by black swan
(Post 12239482)
.... My question is do you have to pay into it like the British system while you are working with insurance stamps. Or is it taken out of the tax you have paid while working, like the Australian system, which is means tested.
Unlike UK NI you cannot make voluntary payments into the US SS system while you are outside the US. |
Re: Social Security for retirees
Thank you for explaining this to me. It does sound more similar to the British system, an insurance for retirement. Unfortunately Australia does not have such a system & so is means tested, although future generations will be able to access Superanuation.
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