Calculation of Benefits for Everyone

¶ … calculation of benefits for everyone involved in this scenario is impossible due to the lack of information. The only information regarding Vincent Agee is the amount of his monthly benefit in 2012 which was $1,700 and his yearly salary which was $102,000. As his Social Security benefits are based on an averaging of his earnings, precise calculations are impossible without knowing more about his earnings history. Also, the exact birthdates of each person involved is not known which would make a marginal difference in the benefits available for each party. As to the effect of Vincent's investments and the receipt of life insurance proceeds on his death, the effect on the receipt of everyone's Social Security benefits would be minimal. To the extent that any of such proceeds would be considered income it would have a small effect but the only individual likely affected would by Peppy, Vincent's wife, as she is only 62 and, therefore, not eligible for full retirement and, therefore, subject to Social Security's earnings cap until she is eligible for full retirement. Prior to Vincent's death, the monthly Social Secuirty income for each member of the family would be approximately as follows: Vincent - $1,700; Peppy - $1,061.67 ($1,180 actual minus $118.33 payback due to earnings cap); Red -- $387.50; Blue -- $387.50 (this will continue only until he either graduates from high school or reaches his 19th birthday whichever occurs first); Green -- $387.50. Subsequent to Vincent's death Peppy's monthly benefits would be survivor benefits of $1,377 and her personal benefits of $1,061.67; Blue is likely not entitled to any benefits subsequent to Vincent's death; Red and Green would be eligible for up to 75% of Vincent's benefits subject to the maximum family amount.

2.

By definition an entitlement program is one that legally obligates the United States to make payments to any person who meets the eligibility requirements established in the statute that created the entitlement. The portion of Social Security related to the payment of retirement and survivor benefits to those who have, through their life-time employment, paid into the system is the entitlement portion of the Social Security system. Social Security provides benefits paid by taxes to the elderly and disabled who have worked. On the other hand, programs such as Supplemental Security Income (SSI), Medicaid and Medicare must be considered as social welfare programs. Arguably, all the benefits paid to Vincent during the course of his lifetime must be considered valid entitlements as are those paid to Peppy based on her own earnings. All other benefits paid to Vincent's family members can legitimately considered to be social welfare benefits.

3.