RET - Social Security and Pensions Lesson

Social Security and Pensions

Introduction

Did you know that saving for retirement is, in a way, mandatory? You don’t HAVE to open an IRA or a 401K, but you have no choice but to contribute to Social Security. The Federal Insurance Contributions Act (FICA) requires a deduction of 6.2% of your income for Social Security. This amount is saved to an account that you can collect from when you retire. A nice added bonus is that your employer must ALSO contribute an amount that equals your contribution. Companies can offer pension plans as well. These are usually fully funded by the employer.

In Your Notebook: Please take down important notes, such as formulas, and attempt the practice examples on your own before viewing the solutions!

In Your Notebook: Please take down important notes, such as formulas, and attempt the practice examples on your own before viewing the solutions.

IMAGES CREATED BY GAVS