Geographic Information

Occupations of SSI Recipients Who Work

Although the Social Security Administration actively encourages Supplemental Security Income (SSI) recipients to work, relatively little is known about how the occupations of those who do work compare with occupations of the nonrecipient population. This article uses the 2007 American Community Survey to estimate dissimilarity indices, which are used to compare the predicted and actual occupational distributions of working SSI recipients with the occupational distributions of the nonrecipient populations with and without disabilities. Although the actual occupational distributions are quite different between these groups, much of the difference can be explained by demographic characteristics, human capital, and disability type.

Access Restrictions and Confidentiality Protections in the Health and Retirement Study

Organizations involved in statistical surveys of human subjects face two important and competing challenges: protecting data confidentiality while maximizing data accessibility to potential researchers. This note examines how the Health and Retirement Study (HRS), conducted by the Institute for Social Research of the University of Michigan, attempts to balance data confidentiality with the desire to broaden the pool of potential data users. Current HRS procedures are summarized and compared with those of organizations with similar programs, and potential ways to expand HRS use without compromising confidentiality are discussed.

Elderly Poverty and Supplemental Security Income

Provided here are the absolute and relative poverty status of 2002 elderly Supplemental Security Income (SSI) recipients. Official poverty estimates are generated from the Current Population Survey's Annual Social and Economic Supplement (CPS/ASEC). The poverty study presented here differs from previous studies in that it is based on CPS/ASEC income and weight records conditionally adjusted by matching Social Security administrative data. This effort improves the coverage of SSI receipt and the accuracy of SSI estimates. The adjusted CPS/administrative matched data reveal lower 2002 poverty rates among elderly persons (with and without SSI payments) than those generated from the unadjusted CPS/ASEC data.

Estimated Retirement Benefits in the Social Security Statement

Alternate Measures of Replacement Rates for Social Security Benefits and Retirement Income

Replacement rates are common and useful tools used by individuals and policy analysts to plan for retirement and assess the sufficiency of Social Security benefits and overall retirement income. Because the calculation and meaning of replacement rates differs depending on the definition of preretirement earnings, this article examines four alternative measures: final preretirement earnings, constant income payable from the present value of lifetime earnings (PV payment), wage-indexed average of lifetime earnings, and inflation-adjusted average of lifetime earnings (CPI average). The article also calculates replacement rates for Social Security beneficiaries aged 64–66 in 2005.

The Reservation Wages of Social Security Disability Insurance Beneficiaries

Using the New Beneficiary Data System, this article examines the reservation wages of a sample of Social Security Disability Insurance (DI) beneficiaries with work capabilities. It analyzes the magnitude of the reservation wages of DI beneficiaries compared to the last wage earned and to benefit amounts. In addition, the article discusses the determinants of reservation wages for DI beneficiaries.

Benefit Adequacy Among Elderly Social Security Retired-Worker Beneficiaries and the SSI Federal Benefit Rate

The federal benefit rate (FBR) of the Supplemental Security Income program provides an inflation-indexed income guarantee for aged and disabled people with low assets. Some consider the FBR as an attractive measure of Social Security benefit adequacy. Others propose the FBR as an administratively simple, well-targeted minimum Social Security benefit. However, these claims have not been empirically tested. Using microdata from the Survey of Income and Program Participation, this article finds that the FBR is an imprecise measure of benefit adequacy; it incorrectly identifies as economically vulnerable many who are not poor, and disregards some who are poor. The reason for this is that the FBR-level benefit threshold of adequacy considers the Social Security benefit in isolation and ignores the family consumption unit. The FBR would provide an administratively simple but poorly targeted foundation for a minimum Social Security benefit. The empirical estimates quantify the substantial tradeoffs between administrative simplicity and target effectiveness.

Characteristics of Noninstitutionalized DI and SSI Program Participants

Poverty-level Annuitization Requirements in Social Security Proposals Incorporating Personal Retirement Accounts

In the current discussions of Social Security reform, voluntary personal retirement accounts have been proposed. Recent research and debate have focused on several aspects of these accounts, including how such accounts would affect aggregate saving, system finances, and benefit levels. Little attention, however, has been paid to policies that would govern the distribution of account balances. This analysis considers such policies with respect to the annuitization of account balances at retirement using the Social Security Administration's Modeling Income in the New Term (MINT) model and a modified version of a recent legislative proposal to evaluate the effects of partial annuitization requirements.

The Canadian Safety Net for the Elderly

Canada's Public Pensions System is widely applauded for reducing poverty among the elderly. This article reviews benefits provided to Canada's older people and compares the Canadian system to the U.S. Supplemental Security Income program. Although Canada's system would probably be judged prohibitively expensive for the United States, the authors argue that there are nevertheless lessons to be learned from the Canadian experience.

Chile's Next Generation Pension Reform

Since its inception in 1981, Chile's system of mandatory individual retirement accounts has become a model for pension reformers around the world. A March 2008 comprehensive pension reform law made major changes that address some key policy challenges including worker coverage, gender equity, pension adequacy, and administrative fees. The cornerstone of the new law sets up a basic universal pension as a supplement to the individual accounts system.

KiwiSaver: New Zealand's New Subsidized Retirement Savings Plans

On July 1, 2007, New Zealand introduced KiwiSaver, a new subsidized retirement savings plan. All new entrants to the labor force and anyone starting a new job are automatically enrolled in a plan and may opt out if they wish. Anyone younger than age 65, including the self-employed and anyone not in the labor force, may choose to set up a KiwiSaver account. The government provides tax credits for both employer and account holder contributions, a one-time tax-free payment to each account, and an annual fee subsidy to defray administrative costs.

The Evolution of Japanese Employer-Sponsored Retirement Plans

This article examines the development of Japanese voluntary employer-sponsored retirement plans with an emphasis on recent trends. Before 2001, companies in Japan offered retirement benefits as lump-sum severance payments and/or benefits from one of two types of defined benefit (DB) pension plans. One DB plan type was based on an earlier occupational pension model used in the United States. The other DB plan type allowed companies to opt out of the earnings-related portion of social security. Landmark laws passed in 2001 introduced a new generation of occupational retirement plans to employers and employees, creating three new DB plan designs and two new defined contribution types of plans. Since that time, the mix of employer-sponsored retirement plans offered in Japan has changed significantly, and overall employee coverage has declined. On balance, employer-sponsored retirement plans have remained largely DB in design.

Individual Accounts in Other Countries

To date, more than 30 countries have established some form of individual accounts in their retirement systems. This article identifies those countries, categorizes how the individual accounts fit into their retirement income systems, and identifies some basic characteristics of the accounts. Because this analysis of individual accounts is intended to inform the current United States debate involving Social Security, the discussion is limited to countries in which such accounts are part or all of a mandatory retirement income program.

Design and Implementation Issues in Swedish Individual Pension Accounts

Sweden's new multipillar pension system includes a system of mandatory fully funded individual accounts. The Swedish system offers contributors more than 600 fund options from a variety of private-sector fund managers. However, in the most recent rounds of fund choice, more than 90 percent of new labor market entrants have not made an active choice of funds and thus have ended up in a government-sponsored default fund.

The Swedish system offers a number of lessons about implementing a mandatory individual account tier. Centralized administration keeps administrative costs down but requires considerable lead time. A very large number of fund options are likely to be offered unless strong entry barriers are in place. Engaging new labor market entrants in fund choice is likely to be difficult. A significant percentage of those making an active fund choice may choose funds that are very specialized and risky. Finally, special care must be devoted to designing a default fund and continual consumer communication.

Recent Changes to the Chilean System of Individual Accounts

Chile was the first country to replace its public pay-as you-go system with individual accounts. Since its inception in 1981, the new program has undergone a number of changes that offer workers more choices than they had before. This note describes those changes, which include an increase in the type and number of funds from which a worker may choose for an individual account, more incentives for making additional voluntary contributions, and the introduction of a separate mandatory individual account for unemployment benefits.

Social Security Reform in Central and Eastern Europe: Variations on a Latin American Theme

The Latin American model of social security reform with individual accounts has been adopted by a number of Central and Eastern European countries. That alternative to a pay-as-you-go system is sometimes advocated as a desirable model for solving problems in developed systems such as that of the United States. This article describes the Central and Eastern European systems and compares them with the Latin American systems.

The Canada Pension Plan's Experience with Investing Its Portfolio in Equities

This article examines the experience of the Canada Pension Plan (CPP) in investing its surplus funds in equities. The CPP investment policy is viewed by some experts as a possible model for increasing the investment income of Social Security. The article discusses the key features of this policy, its implementation, and results to date.

Argentina's Pensions System

Social Security Privatization in Latin America

The new, partially privatized social security system adopted by Chile in 1981 has since been implemented, with some variations, in a number of Latin American and old-world transition economies with either a single- or multi-tier system. That alternative to a pay-as-you-go system is sometimes advocated as a desirable model for solving problems in developed systems, such as that of the United States. This article describes the new programs in Latin America, their background, and similarities and differences among them.

Retirement Income Security in the United Kingdom

This article examines the U.K. retirement income security system from the American perspective. It addresses issues that most concern U.S. analysts: how the United Kingdom has kept its future public pension costs at a manageable level, the extent to which privatization of public pensions has contributed to low pensions costs, the popular appeal of individual pension accounts, and the impact of privatization on retirement income. These issues are best understood in the context of the U.K. pension program's particular institutional structure and policies, two of which—"contracting out" of public pensions, and strong reliance on means-tested benefits—have been largely rejected in the evolution of U.S. policy to date.

Particular use is made of recently available data on coverage rates for public and private pension programs over the total working population and administrative records on inactive personal pension accounts.

Retirement Income Security in the United Kingdom

This study examines the United Kingdom's retirement income security system from the American perspective. It addresses issues that most concern U.S. analysts: how the United Kingdom has kept its future public pension costs at a manageable level, the extent to which privatization of public pensions has contributed to these savings, the popular appeal of individual pension accounts, and the impact of privatization on retirement income. These issues are best understood in the context of the U.K. pension program's particular institutional structure and policies, two of which—"contracting out" of public pensions and strong reliance on means-tested benefits—have been largely rejected in the evolution of U.S. policy to date.

Particular use is made of recently available data on coverage rates for public and private pension programs over the total working population and administrative records on inactive personal pension accounts.

Poverty Among Single Elderly Women Under Different Systems of Old-Age Security: A Comparative Review

This study takes stock of available comparative research on the economic status of elderly single women in six industrialized countries: France, Germany, the Netherlands, Sweden, Switzerland, and the United States. A systematic comparison of income has become easier due to such standardized data bases as the Luxembourg Income Study.

But an explanation for different poverty rates among older women who are on their own requires a further, differentiated assessment of the countries' retirement benefit structures. This article attempts such a review. It makes use of a variety of single-country sources and takes into account the institutional heterogeneity of old-age security systems. The study concludes with a view of the effectiveness of different old-age security systems in preventing poverty among older single women.

Privatizing Social Security: The Chilean Experience

In 1981, Chile introduced a new approach to social insurance, a system of individual capitalization accounts financed solely by the employee. This new privatized system was an improvement over Chile's failing pay-as-you-go arrangement. As many countries worldwide are facing financial problems with their social security system, they are now looking to the Chilean model in trying to find solutions. This article describes the conditions that led to the new system, the transition, and details of the new privatized system.

Social Insurance Provisions for Children With Disabilities in Selected Industrialized Countries

In the United States, low-income families who have a child or children with a disability may be eligible for cash benefits payable under the Supplemental Security Income (SSI) program. In the last few years, the number of these children on the SSI rolls has increased dramatically due, in large part, to new standards developed in response to a 1990 Supreme Court decision and the subsequent retroactive activity as a result of that decision. The rise in the number of child beneficiaries has led to increased concerns as to whether cash benefits are the best way to help these children and their families deal with the additional needs and expenses caused by disabilities. This article begins with a summary of recent American developments regarding the childhood disability issue as background to an exploration of comparative practices.

In light of the current interest in the United States concerning children with disabilities, it seems timely to explore the approaches used by other countries' social insurance programs. This study details the practices and provisions of 14 European countries and 4 other developed countries (Australia, Israel, Japan, and New Zealand). In addition to examining the variables involved in making cash benefits available and awarding them to families on behalf of disabled children, the article also provides information of in-kind benefits to which such families would be entitled and gives some insight as to the philosophy and policy goals of selected foreign programs.

Social Security Beneficiaries Affected by the Windfall Elimination Provision in 2006

The Windfall Elimination Provision (WEP) is a method of computing benefits for some workers who receive a pension based on non-Social Security covered work. At the end of 2006, about 970,000 beneficiaries, mainly retired workers, were affected by the WEP. This article provides a brief legislative history, describes the WEP computation, and presents statistical data about beneficiaries affected by the WEP.

Characteristics of Disabled-Worker Beneficiaries Receiving Workers' Compensation or Public Disability Benefits Compared With Disabled-Worker Beneficiaries Without These Additional Benefits

State and Local Pension Plans' Equity Holdings and Returns

This article examines the recent trends in the size and performance of the equity investments of state and local pension plans. It also provides a context for the discussion about investing some portion of the Social Security trust fund reserves in private equities.