Question

The actuarial adjustment in Social Security refers to

Group of answer choices

a) the amount by which Social Security benefits are adjusted for individuals who are married as opposed to single.

b) the amount by which one's annual Social Security benefits are reduced if one has labor earnings above a certain amount in a given year.

c) the amount by which annual Social Security benefits are adjusted relative to the primary insurance amount when one begins claiming benefits at an age other than the full retirement age.

d) the amount by which one's Social Security benefits are reduced due to federal, state, and local taxes.

Answer 1

The actuarial adjustment in Social Security modifies the benefit amount based on whether a person claims benefits before or after the full retirement age, with reductions applied for early claiming and increases for delayed claiming.

Step-by-step explanation:

The actuarial adjustment in Social Security refers to the amount by which annual Social Security benefits are adjusted relative to the primary insurance amount when one begins claiming benefits at an age other than the full retirement age. This adjustment is designed to keep the system fair and sustainable, as benefits are claimed over a varying number of years depending on the age at which a retiree starts to take those benefits. If claimed before the full retirement age, the benefits are reduced to account for the longer period over which the retiree is expected to receive them; conversely, if the benefits start after the full retirement age, they are increased.