The Standard of Living for Retirees in the United States

The US pension system is hardly unique. It has a standard structure for retirees has remained stable over the years. The US pension system consists of private and public funds. Every US citizen who has a high salary can save up for several pensions. Women retire at 65, and men retire at 67. It all depends on what age group the person belongs to:

• Those born before 1938 retired at age 65.
• Anyone born between 1939 and 1943 must add two months each year to reach retirement age.
• People who were born from 1943 to 1954 retire after reaching the age of 66. So, citizens born in 1955 can apply for pensions after they turn 66 years and 2 months old.
• People who were born in 1960 and later will be able to become pensioners at the age of 67.

US citizens who wish to retire early can only do it after they turn 62. After that, they need to apply to the pension fund, indicating the reasons for such a decision. Moreover, the reason must be strong enough to force a person to get rid of the third part of the pension. Since those who retire at 62 receive only 70% of the amount that was accrued to them.

Who can receive a pension?

To earn a state pension, every US citizen must work legally for at least 10 years. From each resident of America, who is legally registered at work, a certain percentage of funds is deducted to the pension fund. Every year, each employee is awarded 4 points. To receive a pension, each resident must earn at least 40 points. Accordingly, you will have to work for 10 years minimum.

The structure of the pension system in the United States

Americans are very scrupulous about this issue and are closely watching how their pension accruals are formed. Every year, in January, all residents who have not yet become a pensioner receive a document with the following information:

• The total number of points earned.
• If the pension has already been accrued, people receive info with its amount, the number of years worked, and the salary amount.
• Any additional info. In particular, the rules for pension registrations, accrual features, etc.

Americans can also count on savings funds. These are the so-called additional pensions. They are accumulated by large companies. Each of them has its pension fund, and its employees can allocate part of the funds. Moreover, to encourage their employees to stay with the company, enterprises usually add 10 to 15% of the funds as an incentive. If the company is large, employees will receive an additional 50% of the number of their deductions to their accounts.

The minimum pension payment per person in the US is $850. A married couple can receive a minimum of $1,200. The maximum retirement benefit is $1,800. The size of the average pension provided by the state is approximately the same in all states and amounts to $1,505.