My professor asked me to do this project on social security because he thought that it would open my mind as to how our money works. I thank him for this opportunity. I was totally against the reform of social security by privatizing it until reading many articles containing this subject matter. I can now say that I agree, sometimes being ignorant to a situation will let you make decisions that can not only hurt you, but generations down the line. Look at what has happened to social security thus far.
The social security program started when Franklin D. Roosevelt signed the Social Security Act on August 14, 1935. Taxes were collected for the first time in January 1937 and the first one-time, lump-sum payments were made that same month. Regular ongoing monthly benefits started in January 1940. Social Security was originally just a retirement program. Under the 1935 law, Social Security only paid retirement benefits to the primary worker.
A 1939 change in the law added survivors' benefits and benefits for the retiree's spouse and children. In 1956 disability benefits were added.
Social Security is actually several related programs rolled into one and financed by a flat-rate tax on all employment earnings, up to specified limits. The taxes go into a trust fund and are intended, over the long term, to be used to pay for promised benefits. The main programs within Social Security are: A retirement annuity which provides a monthly income to retired workers (and their spouses) based on their period of employment and earnings. It works like an annuity in that the beneficiary receives a fixed monthly payment and the total received depends on how long the beneficiary lives. A spousal and survivors benefit. Benefits are available for dependents and survivors of an insured worker. A...