If you have a job, you’re paying into the Social Security program. Social Security, or more officially and appropriately, the Old age, survivors, and disability insurance program (OASDI); is more than just a check when you retire or a payroll deduction on your pay stub. In addition to the “old age” portion, it is also a disability insurance program that provides for individuals who are unable to work because of a disability.

Each month, you pay 6.2% of your paycheck into the OASDI program, up to a limit of $6,621.60 a year (the tax is only on the first $106,800 of earnings). Three months before your birthday, you will receive a Social Security Statement. This post will explain how to read and review that Social Security statement.

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I’ve been getting a lot of emails lately about the $250 Social Security stimulus check so I thought a post would be the best way to answer all of your questions. If you’re wondering where your $250 Social Security stimulus check is, wait until June 4th before trying to contact the Social Security Administration. The American Recovery and Reinvestment Act of 2009 gave all social security recipients (SSI included) a one-time $250 payment, so if you are one of the 50 million individuals who get those benefits, the check is in the mail!

Who is eligible? You must be eligible for Social Security, SSI, Veterans, or Railroad Retirement benefits during November 2008, December 2008, or January 2009. If you were not eligible at that time, you will not receive the check. If you are eligible for multiple benefits, you will only receive one payment.

When and how will I receive the payment? You will get it the same way you are getting your current Social Security and Supplemental Security Income benefit. If you get it by check, you’ll receive the payment as a separate check. If you get it by direct deposit, you will get it as a separate direct deposit. The government has staggered the mailing of those payments throughout May so if you haven’t received it, it’s likely in the mail or in processing. You don’t have to do anything to receive the check and the Social Security Administration will not contact you for any information.

What if it’s after June 4th and still no sign of a check or deposit? Visit the Social Security Administration’s website for the one-time economy recovery payment information page to find out who you need to contact for more information. If you just want more information, this electronic booklet about the one-time economy recovery payment is also very informative.

Five years, on the first day of my first “real” job, the HR administrator of my company handed me a folder labeled XYZ Company Pension & Retirement Plan. Inside the folder was a description of the company’s pension and 401(k) package, two “things” that meant almost nothing to me. I knew what a pension was but had no clue was a 401(k) was, but the folder seemed to have enough information in it to help me start my own 401(k) company if I wanted to. I made some good decisions about my 401(k), mostly by luck (I put 40% of my money into emerging markets, which was a good choice but I did it for a bad reason – I had no reason!), but you shouldn’t have to.

Retirement investing is not rocket science, it’s just confusing with all the acronyms and the taxability and everything else. The basics, which we’ll cover in this Foundation series article, once you unravel the confusion, are fairly straightforward.

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Every month, go through you wallet or purse and ensure that everything in it has a reason for being there.

The other day, while standing in line at the DMV to take a photo for my driver’s license renewal, I saw a man pull his Social Security Card out of his wallet. As we all know, the Social Security card is no more than a regular piece of paper that, given years in a wallet, is bound to disintegrate. This guy’s Social Security card was in such sorry shape that it looked like it was torn from the Constitution. Years of sitting in his back pocket, for no good reason, had his card about a year away from being dust and there was little reason for him to carry it every day (in fact, new Social Security cards instruct you not to carry it on you).

Besides deterioration, another good reason not to carry the card, or anything you don’t use on a daily basis, is that you could lose your wallet or purse. If that unfortunate event happens, you have the burden of replacing or canceling cards that had no reason being in your wallet or purse in the first place. Added headache without any reason whatsoever.

So once a month, clean out your wallet or purse so Constanza doesn’t mistake it for his.

One of the tricky things about being “recently married” is that the missus was in name limbo. “Technically,” she’s my wife with my last name (that’s right!). “Legally,” she still retains her maiden name until she goes to the Social Security Administration to change her SS card name and the DMV or MVA to change her license name. So what happens when we get a check written out to her new name? Trickiness! Headaches! But not to fret, I’ll try to capture everything we’ve done so that it can be as painless as possible for all you newlyweds out there.

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When I was younger, I used to play Sid Meier’s Civilization all the time. One of the best parts of the game was trying to build one of the Seven Wonders of the Ancient World because it gave your civilization a distinct advantage in the world. My personal favorites were the Lighthouse (it gave your ships a farther range and they wouldn’t get lost) and the Hanging Gardens of Babylon (I believe each one of your cities now had a Granary), but fun part was being exposed to these wonder in the first place.

Since then, there have been more “Wonders of the World” like the Natural Wonders of the World, 7 Wonders of the Modern World, so why not create a Seven Wonders of the Personal Finance World? Hokey, I know, but it’s my opinion that, if you can, you should “visit” every single one of these wonders.

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I wrote about how we’ve been lucky to experience a period of exceptionally low tax rates, likely helping the prosperity we’ve experience because people have more money to spend, in the past when I took a look at the historical top marginal tax rate a few weeks ago. Well, yesterday Pat Regnier did the same in a piece called the Great Tax Hike in which he argues that we’re likely going to see an increase in our taxes as we try to figure out how we’re going to deal with the Social Security shortfall, increased spending on Medicare, servicing the national debt, and a host of other issues. Now, the big twist, which I mentioned in my Devil’s Advocate post against Roth IRAs, is that some of these tax hikes could come by way of a consumption tax, an added tax on the things you buy, and so the Roth IRA wouldn’t protect you against that.

So, what does this mean? Since none of us can see the future, we should all diversify your retirement asset tax profile to make sure we aren’t caught going one way or the other.

The big story in the news these days is President Bush’s attempt to reform our nation’s Social Security program. But is it really broken? You hear the horror stories about how it’ll be bankrupt in 20xx (insert years here) but will it really be?

According to government’s Social Security website quick calculator, for an individual born in 1980 who makes $40,000 this year who plans to retire in 2065, you will receive $1,239.00 in 2005 dollars each month starting in 2047 (67 years old). The $1,239.00 is projected to actually be $5,254.00 in 2042 dollars given inflation (CPI, etc). That assumes an orderly 3.75% raise each year until 2045. This is all just for retirement and not for disability or survivor benefits.

That sounds great right? Let’s get a second opinion…

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