Friday, August 12, 2022

Minimum Social Security Rate versus Minimum Hourly Wage Rate

What is the minimum amount for Social Security?

In 2022, the special minimum benefit for a worker with 30 years of work history who waits until full retirement age (FRA) to claim benefits is $950.80. When qualifying for the special minimum, you cannot increase your primary insurance amount by waiting past full retirement age. You will not accrue any delayed retirement credits.

However, starting your benefits early will still reduce your monthly payment. The same worker with 30 years of work history will have his benefit reduced to $665.56 if he starts his/her benefits early at age 62.

This got me to thinking about the debate to raise the minimum wage to $15.00 an hour. Currently it stands at $7.25 an hour but many states have amounts that are between these two figures.

Regardless of the amount I wondered what the minimum hourly rate versus the minimum hourly rate for social security would look like annualized.

Social Security 950.80 X 12 months = $11,49.60

Social Security 665.56 X 12 months = $ 7,986.72

Minimum Wage 7.25 X 40 hours = 290 a week X 52 = $15,080

Minimum Wage 15.00 X 40 hours = 600 a week X52 - $31,200

Something is wrong here?  I suggest the do-gooders in Washington also raise the minimum wage for Social Security to $2400 ($600 week) a month as well. 

The Center on Poverty and Social Policy at Columbia University estimates that 8 million Americans slipped into poverty during the coronavirus pandemic.

Poverty rates for adults over the age of 65 were the most unchanged across age demographics. This is likely due to the number of people in this demographic who rely on retirement income and Social Security instead of wages.

  • The monthly poverty rate for older adults increased from 15.7% in January to 16% in September, a less significant change than with other demographics.
  • The monthly poverty rate for adults ages 18 to 64 increased from 14.3% to 15.5%.

The monthly poverty rate for children increased from 18.7% to 20.4%.


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