Retirement EPF.18d examine the fundamental workings of Social Security and thesystems effects on retirement planningEPF.18e contrast alternative retirement plans
For many individuals, Social Security is their only retirement plan.The amount one receives depends on several factors.Social Security has several types of benefits.EPF.18d examine the fundamentalworkings of Social Security and thesystems effects on retirementplanning
What is the purpose of Social Security? Social Security was designed as a safety net to provide income to older people when they could no longer work.
What determines how much onereceives in benefits? Social Security benefits are determined by the amount an individual has contributed to the system and the individual’s age when claiming benefits.
What are the types of benefitsprovided through the Social Securitysystem? Social Security benefits include disability and survivor benefits, as well as retirement income.
What are some of the concerns aboutSocial Security when planning forretirement? For retirement planning, Social Security payments are likely to be less than income has been. Most retirees will need to supplement through savings, investments, continued employment, or adjusted lifestyle.
EPF.18e contrast alternativeretirement plansThere are many types of retirement plans. There arecosts and benefits to each.
What types of retirement plans are available? Individual Retirement Account (IRA) tax-sheltered annuity (TSA) Keogh plan annuity employer retirement plan public pension plan.
What are the costs and benefits ofeach?Evaluating retirement plans requires knowledge of the costs and benefits of each type.For example, one cost of an IRA is the severe early-withdrawal fee, which is countered by the benefit of contributions reducing taxable income.