The Social Security Act has established numerous programs that provide supplemental income for insured individuals and their families in the event of disability, when they retire or at death. This supplemental income acts as a safety net — especially in old age — and keeps an estimated 22 million Americans out of poverty.
How much do you know about claiming strategies, spousal benefits and estate implications? Take our quiz below to find out.
1. What percentage of Americans over the age of 65 receive some form of income from Social Security?
a) Approximately 90%
b) Approximately 80%
c) Approximately 70%
2. What is the most common age for people to begin collecting Social Security benefits?
a) Age 65
b) Age 62
c) Age 66
d) Age 70
3. As a general rule, a worker taking reduced retirement benefits before Full Retirement Age (FRA) will continue to receive a reduced rate after normal retirement age.
4. Can a person receive retirement benefits regardless of the amount of his or her wealth and his or her income in retirement?
a) No. A person with assets exceeding $12.5 million forfeits a percentage of their retirement benefits.
b) No. A person with assets exceeding $5 million forfeits a percentage of their retirement benefits.
c) Yes. A person is entitled to benefits regardless of personal wealth or retirement income, though excess earnings arising from his or her personal services (earned income) may result in a loss of benefits.
d) The answer depends on how much the individual has contributed to Social Security payroll taxes.
5. When do retirement benefits end?
a) At the worker’s death
b) At the worker’s spouse’s death
c) At the worker’s assigned beneficiary’s death
d) Once the worker’s contributed payments have been reimbursed in full
6. A spouse must be dependent upon the worker for support in order to be eligible for a spouse’s benefit.
7. Will the Social Security Administration pay benefits to college students?
a) Yes. If certain terms are met, a child’s benefit may be payable so long as the child is a full-time student.
b) Maybe. If certain terms are met, a child’s benefit may be payable up until age 21.
c) No. Benefits are paid only to students taking courses at twelfth grade or below.
8. Can Social Security payments go to the estates of deceased beneficiaries?
a) Yes. The Social Security Administration may pay amounts due a deceased beneficiary at the time of death to a family member or legal representative of the estate.
b) No. Amounts due a deceased beneficiary at the time of death may only be paid to a surviving spouse or child.
9. A worker must be fully insured at death to qualify the widow(er) for a widow(er)’s benefit.
10. Do Social Security benefits increase by continuing to work and contribute to Social Security?
a) Yes. The longer you contribute to Social Security, the higher your benefit will be.
b) It depends. When benefits are computed, Social Security uses the highest thirty-five years of indexed earnings. If the current earnings exceed the lowest year used in the computation, the benefits will increase.
c) No. Benefits are fixed and will not increase if you continue to work beyond age sixty-seven.