Cheap Personal Insurance? – (Social Approach to Affordable Coverage?)
What is social insurance? Unlike auto insurance in California, it serves a different purpose.
This purpose has a past. This past will help look at how social insurance programs started It is a lot different then the general car insurance quote.
This social coverage has also taken steps in automobile coverage.
You will see how the two have emerged.
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Let’s begin, before people needed car insurance. Before the industrial revolution, the United States was a majority of small farmers.
Yes, the country make up was of this demographic. They made the majority.
As people moved into urban areas demographics started to change. These new workers worked for wages. This became difficult to provide for a family’s needs in a period of hard financial times.
This is important to remember since the Great Depression was right around the corner.
This is important to consider when you compare car insurance rates side by side. Because, there are more layers to this program.
Great Depression of Insurance Protection
The Great Depression of the 1930’s made people aware of this fact and helped to pave the road for change.
Congress passed the Social Security Act.
President Franklin D. Roosevelt signed this act in 1935. The law became effective on January 31, 1937.
Social security has been a basic part of our lives for over 7 decades.
Having said that, you can see why it is important to learn what the basics are. This act has the potential to effect every American.
Successful General Coverage
This act is the most successful domestic government program in our history. Throughout changing times in our nation, the law has had some modifications.
This would be a normal function in changing times. The law should reflect current times, and through alterations it has stayed relevant.
There are approximately 155 million workers that have coverage under this system. Around 55 million people receive other benefits.
This is the personal insurance definition. Some of these benefits include:
- retirement coverage
- survivors benefits
- disability benefits
Benefits of the System
All these benefits come from Social Security.
In fact, one of 3 Social Security Beneficiaries is not a retiree. This is huge because as you can see, it effects many Americans.
- An example where someone is working and receiving these benefits are as followed:
- If you were to receive disability or survivors benefits.
- Another example would include retirement benefits of a covered worker. This is usually if a spouse had this coverage.
This system provides a basic floor of benefits for retired workers.
- The system also provides benefits for the workers family. If the spouse should die, the benefits would transfer over to the covered family.
- The government never meant for the program to meet all the participants needs.
- It is a foundation upon the worker can build a financial future.
- The worker will need a pension plan or savings in combination to Social Security.
With inflation on the rise and cost of living going up, this is an important coverage to know you have in the future.
1 more than half of all workers in the United States have employer sponsored retirement plans. This makes it important for the others to save for retirement.
This system replaces about 40 percent of the average workers pre retirement earnings.
Financial planners say that retirees need 70 percent of pre retirement earnings. This would ensure a security net for the retiree.
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Depending how much you paid into the system, will determined how much you receive.
So, if you worked for 30 years and contributed to the system over those years, expect more back.
The same goes if you were part time for a few years and started collecting.
- This amount would be a lot lower than the retiree with 30 years of vested time into the system.
- The higher the wage earner, the more the pay is into the system. This in return comes back as higher benefits.
- So, it is not only how long you paid into the system, but how much.
- If you made more money and worked less years, it may total the same of the 30 year retiree in above example.
The benefit formula is in favor of lower wage earners. This was the whole reason behind the program. To protect the exposed.
Lower wage earners receive a higher percentage of their previous earnings.
In October 1999, the Administration began mailing a statement on a yearly basis. Workers age 25 and older received these statement.
You would receive these statements 3 months before your birthday. This statement showed the following:
- estimate of worker’s retirement
- survivors benefits
- disability benefits
- age at which you can receive full retirement benefits.
Most people in the workforce have received some type of statement like this.
More than 9 out of 10 retirees receive benefits payments each month.
A sad lesson learned is that, 2 third of elderly people use this benefit as their major source of income.
- You can understand why so many are passionate about preserving the program.
- This is their main source of living. You take this away from them, then what.
- This is why this topic always becomes a heated political discussion.
- You see politicians from both sides making their claim for Social Security.
- They know that it is a hot topic, especially among their constituents.
Only Income Source
For some elderly Americans, it is the only income. This number is a staggering 1 third of the elderly.
Only 11 percent of seniors live in poverty. Without these benefits, that number would be 50 percent.
- This would be a tragic story form many elderly people without this program.
- It would be devastating for many Americans reaching their retirement age.
- Can you imagine a country without Social Security?
- Even if you disagree with the program, there must be some type of program in place to help Americans.
It’s not fair if workers paid into a system for many years to learn that it doesn’t exist once they need it.
It would be no different if you put money in savings account expecting to pull it out when you need it.
You go the bank to withdraw those saving dollars to find out that the account has closed.
This would be terrible shock. What would you do if you were relying on that money to survive your golden years.
Your at a point where your body and mind can’t work, then what?
As you can see, so many scenarios could occur and that is why a layer of protection was set into place.
President Roosevelt signed the act into law, after passed by Congress back in 1935. This law still effects many American some decades later.
Just imagine if people did not have this security blanket, what would they do? Would a different system some to play.
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Education is key to finding the cheapest car insurance available or general car insurance coverage.