Social Security Column
May 2009
By Karyl Richson
Social Security Public Affairs Specialist in Milwaukee, WI

HOW WILL YOU SPEND YOUR RECOVERY PAYMENT?

Do you receive Social Security or Supplemental Security Income (SSI) benefits?  If so, you’re ikely receiving a special, one-time recovery
payment this month.  The recovery payment is $250.  More than 50 million beneficiaries will receive more than $13 billion in recovery
payments in May.

Let’s go over the basic facts so you understand how the payment is being made.  

•        The payment is automatic; no action is required on your part;
•        The payment is a direct result of the American Recovery and Reinvestment Act of 2009 passed by Congress and signed by President
Obama in February 2009;
•        Your one-time economic recovery payment will arrive separately from your Social Security or SSI benefit; it will not be included with
your monthly benefit payment; and
•        There are no requests to make, no applications to complete and no fees to pay.

To assist in processing the payments as efficiently as possible, please do not contact Social Security — unless you have not received your
payment by June 4.  More information is available at www.socialsecurity.gov and will be updated as needed.

If anyone contacts you asking for your personal information or for a fee to help you get your payment, it’s probably a scam.  If you’re unsure
about the identity of someone claiming to be a Social Security employee, hang up and call 1-800-772-1213 (TTY 1-800-325-0778) to verify
the call.  You may report suspicious activity involving Social Security programs and operations to the Social Security Fraud Hotline website
at
www.socialsecurity.gov/oig/hotline or call 1-800-269-0271 (TTY 1-866-501-2101).

So, how do you plan to use your extra $250 this month?  Visitors to Social Security’s website have been telling us their plans.  Here is
some of what they’ve shared:
o        "My car needs to have all four tires replaced.”
o        "Get my kids spring and summer clothes."
o        "I will take a trip to see my grandchildren."
o        "Pay for a class at college."
o        "Replace air conditioner."

To learn more about Social Security and the recovery payments, or to share your plans for your recovery payment, visit
www.socialsecurity.
gov/payment.

To learn more about the American Recovery and Reinvestment Act of 2009, visit
www.recovery.gov.


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THEY’VE SERVED US; LET US SERVE THEM

I
t’s customary to honor the men and women of the Armed Forces each Memorial Day — especially those who have made the ultimate
sacrifice in the line of duty.  May also is National Military Appreciation Month, a great time to let members of the military know how much we
value what they are doing for us and our country.

Serving the military is nothing new for Social Security.  People in the Armed Forces have been covered under Social Security since 1957.  
Even people in the service before 1957 may receive special credit for some of their service.  People in the military are covered for the same
survivors, disability and retirement benefits as everyone else who pays into Social Security.

A person’s Social Security benefit depends on earnings, averaged over a lifetime.  The same is true for members of the military.  Generally,
the higher your earnings, the higher your Social Security benefit.  Under certain circumstances, special earnings can be credited to one’s
military pay record for Social Security purposes.  The extra earnings are for periods of active duty or active duty for training and may help
someone qualify for Social Security or increase the amount of Social Security benefits.  If you qualify for extra earnings, Social Security will
add them to your earnings record when you file for benefits.

For today’s military service members who have been wounded and need to apply for disability benefits, it’s important to know that you will
receive expedited processing.  The expedited process is for military service members who become disabled while on active duty on or after
October 1, 2001, regardless of where the disability begins.  Depending on the situation, some family members of military personnel may
be able to receive benefits, including dependent children and, in some cases, spouses.  Learn more about it at www.socialsecurity.
gov/woundedwarriors.  Please pay special attention to the fact sheets available on that website titled Disability Benefits for Wounded
Warriors and Expediting Disability Applications for Wounded Warriors.

You’ll also find links on the Social Security Wounded Warrior page to useful VA and Medicare websites.

To learn more about Social Security for people who have served in the military, read a copy of our publication, Military Service and Social
Security.  You can find it online at
www.socialsecurity.gov/pubs/10017.html, or call us at 1-800-772-1213 (TTY 1-800-325-0778) to ask for a
free copy to be mailed to you.

The men and women of the Armed Forces serve us each and every day.  At Social Security, we’re here to serve them too.

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PLAN NOW FOR A BETTER FUTURE

May is Older Americans Month, and the theme for this year’s observance is “Living Today for a Better Tomorrow.”  While much of the theme’
s emphasis is on the need for aging Americans to take care of their physical well-being to ensure a healthy future, the theme can also
apply to their financial well-being.  Not only personal finances, but how older Americans help keep the overall economy alive.

Money may be a bit tight right now, but just a little extra effort today in financial planning can yield big dividends later on no matter what your
age.  Here’s why.  

A study on retirement satisfaction by researchers at Boston College asked retirees this question:  “All in all, would you say that retirement
has turned out to be: very satisfying, moderately satisfying, or not satisfying at all?”  They found that among retired couples, those who
answered “very satisfied” or “moderately satisfied” had income in retirement replacing 72 percent of their pre-retirement earnings, while
those who said that their retirement was “not satisfying at all” had income replacing only about 60 percent of their pre-retirement earnings.  

If these numbers seem daunting to you, remember that Social Security provides about 40 percent of pre-retirement earnings replacement
for the average wage earner, making Social Security the foundation upon which you can build your secure retirement.  You also will need
other savings, investments, pensions or retirement accounts to make sure you have enough money to live comfortably when you retire.  
And Social Security offers several tools to help you plan now for a better future.

Every year workers 25 and older receive a Social Security Statement in the mail about two to three months before their birthday.  The
Statement gives you an estimate, based on your current earnings, of what you might expect in Social Security retirement benefits.  You can
then visit our Retirement Planner — at www.socialsecurity.gov/retire2 — where you can personalize various financial scenarios to
determine what your individual retirement plan should look like.  

You’ll also want to visit our popular Retirement Estimator.  There, you can key in some basic information and get a quick and accurate
estimate of your benefit amount using different scenarios.  You can find the Retirement Estimator at www.socialsecurity.gov/estimator.

Once you know just what to expect from Social Security in retirement, you will know just how much you need to save to be among the “very
satisfied” American retirees.  And America will thank you for it, because Social Security payments don’t stop in the bank accounts of older
Americans.  From there, they venture into the economy, purchasing goods and services.

Learn more about Social Security at
www.socialsecurity.gov.


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NEW WORKERS:  KNOW YOUR NUMBER

Summer is approaching, and millions of high school and college students will be searching for jobs.  The jobs will be as diverse as the
people applying for them, but one thing will be the same in all cases:  the employer will need to know your Social Security number.
Don’t know where your card is?  That’s all right — there is no need to apply for a new one.  The most important thing is simply to know your
number.  You do need to make sure that the Social Security number you provide is correct, because it will be used to keep track of your
earnings and will directly affect your future benefits.  Here’s why.  
By law, employers must withhold from a worker’s paycheck Social Security taxes at the rate of 6.2 percent of gross pay.  In addition, a
Medicare payroll tax of 1.45 percent of pay must be withheld.  The amounts you pay in Social Security and Medicare taxes are matched by
your employer.  Usually the money that is withheld is referred to as “Social Security taxes” on the employee’s payroll statement.  
Sometimes the deduction is labeled as “FICA taxes” which stands for Federal Insurance Contributions Act.  As a young worker, you might
find that Social Security taxes are actually more than state or federal income tax.  So let us tell you how that money is being used, and what’
s in it for you.  

The taxes paid now translate to a lifetime of protection, whether you retire or become disabled.  And in the event that you die young, your
family may be able to receive survivors benefits based on your work.  Today you probably have family members — grandparents, for
example — who already enjoy Social Security benefits which your Social Security taxes help provide.

Because you’re a long way from retirement, you may find it hard to appreciate the value of benefits that could be 40 or 50 years away.  But
you should know that your Social Security could pay off sooner than you think.  Social Security provides valuable disability benefits — and
studies show that a 20-year-old has about a three in 10 chance of becoming disabled sometime before reaching retirement age.

Another bit of helpful advice for young workers:  if you’re offered a job “under the table” or “off the books,” think twice.  The person offering it
will likely tout the benefits of not paying taxes.  But they’re the only ones benefiting because they don’t have to pay their half of your Social
Security tax.  In the end, you’re being cheated out of your future benefits when you don’t pay taxes on your earnings.

In closing, know your number, but don’t carry your Social Security card around with you.  It’s an important document that needs to be
safeguarded and protected.  You should keep it safely at home, in a safe deposit box or wherever you keep your important paperwork, like
your birth certificate and personal information.  If you haven’t already, make it your summer homework assignment to memorize your
number.  After all, you’ll be using it for a lifetime.

If you have questions about Social Security, the best place to go is online — to
www.socialsecurity.gov.


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IN TIMES LIKE THESE, EVERY DOLLAR COUNTS

(Editor’s note:  Father’s Day is June 21.  We are sharing this in the May MIP so that you have appropriate lead time to place this in time for
Father’s Day.)

Fathers are often known for their good advice, whether it’s how to catch a ball, ace a job interview, grill the perfect burger or get the best
deal on a new car.

But if your father is struggling with the high cost of prescription drugs, maybe it’s time for you to give him a few words of advice.  This Father’
s Day, you may be able to help your dad save an average of $3,900 a year on his prescription drug costs.  Here’s how.

If your father, or any father figure you know, is covered by Medicare and has limited income and resources, he may qualify for extra help —
available through Social Security — to pay part of his monthly premiums, annual deductibles and prescription co-payments.  The extra help
is worth an average of $3,900 per year.  

To figure out whether your father is eligible, Social Security needs to know his income and the value of his savings, investments and real
estate (other than the home he lives in).  To qualify for the extra help, he must be receiving Medicare and also have:

•        Income limited to $16,245 for an individual or $21, 855 for a married couple living together.  Even if his annual income is higher, he
still may be able to get some help with monthly premiums, annual deductibles and prescription co-payments.  Some examples where
income may be higher include if he or his wife:
      —Support other family members who live with them;
      —Have earnings from work; or
      —Live in Alaska or Hawaii; and

•        Resources limited to $12,510 for an individual or $25,010 for a married couple living together. Resources include such things as bank
accounts, stocks and bonds.  We do not count his house or car as resources.

Social Security has an easy-to-use online application that you can help complete.  You can find it at
www.socialsecurity.
gov/prescriptionhelp.  To apply by phone or have an application mailed to you, call Social Security at 1-800-772-1213 (TTY 1-800-325-0778)
and ask for the Application for Help with Medicare Prescription Drug Plan Costs (SSA-1020).  Or go to the nearest Social Security office.

To learn more about the Medicare prescription drug plans and special enrollment periods, visit
www.medicare.gov or call 1-800-
MEDICARE (1-800-633-4227; TTY 1-877-486-2048).  

So this Father’s Day, as the meat is grilling, you’re playing catch, and talking about your own kids, fit in a bit of good advice for Dad — advice
he can put to use right away.  Tell him about the extra help with his prescription drug costs.  In fact, you can help him apply online in
minutes at
www.socialsecurity.gov/prescriptionhelp.  After all, in times like these, every dollar counts.

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