The Ultimate Social Security Quiz

Staff

4 Min Quiz

Image: refer to hsw

About This Quiz

Social Security tax takes big bite out of your paycheck. Knowing about Social Security benefits may give you needed payments in the event of death, disability or retirement. Test your knowledge to see how much you know about Social Security benefits and deductions.

How often are Social Security statements issued?

You will receive a yearly statement from the Social Security Administration.

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How is Social Security funded?

Currently, the Social Security payroll tax is 12.4% of wages up to $90,000. You share this expense with your employer, you pay 6.2% and so does your employer.

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Where does the government keep all the Social Security funds?

The funds are invested in interest-paying government bonds.

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How much of Social Security benefits are distributed as disability benefits?

17 percent of Social Security payments are for disability benefits.

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How much of Social Security benefits are distributed as survivor benefits?

Fourteen percent of Social Security benefits are paid as survivor benefits. The surviving spouse and children of a deceased may receive Social Security survivor benefits.

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Do most retirees live solely on Social Security benefits?

Social Security benefits are a very important source of income for most retirees, but only about 20 percents depend on the benefits for 100 percent of their living expenses.

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At what age may you start collecting benefits?

Early retirement starts at 62 and the full retirement age is determined by your birth year.

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If you were born during 1945, at what age may you receive full Social Security benefits?

If born in 1945, you will be eligible for full Social Security retirement benefits at age 66.

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Taking early retirement reduces your benefits by how much?

Your benefits will be permanently reduced by about 20 percent if you start payments at age 62.

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What about inflation?

Benefits are increased by a cost-of-living adjustment which averages between 3 to 4 percent every year.

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How should you fund the portion of your living expenses that Social Security benefits won't cover?

In addition to Social Security benefits, you should have personal savings and retirement funds to pay for your living expenses.

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What type of disability is covered by Social Security disability benefits?

To qualify, you must have a mental or physical disability for at least 12 months. The disability must be continuous and prevent you from working.

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Are alcohol and drug problems considered a disability?

Alcohol and drug addiction are very serious problems, but they are not considered to be a disability for the purpose of Social Security disability benefits.

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Do Social Security benefits apply automatically?

You must apply for benefits. To get an application, go to your local Social Security office or Social Security Online.

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How do I receive my benefits?

Benefits are paid monthly by check or automatic deposit to your bank account.

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Are Social Security benefits guaranteed?

As long as many more people are paying into the system than taking benefits, the system will be sound. Currently there is great concern for the future of Social Security benefits.

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What may be the fix for Social Security funding problems?

Raising taxes or lowering payments would be, in theory, a likely fix. Neither of these two solutions is popular.

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When did Social Security become law?

President Franklin D. Roosevelt signed the Social Security Act of 1935.

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To help Social Security, what did then-president George W. Bush propose?

He proposed allowing individuals to contribute up to 4 percent of their Social Security payments to a private account. This private account would be invested in the stock market.

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What happens if you use someone's Social Security card?

If caught you face a $25,000 fine and up to five years in prison.

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