Question

Case 1: Ben was born in 1960 and has remained steadily employed since getting his first job at age 17.

For the last 28 years, he has been a long-haul driver for a trucking company. He enrolled in a defined
benefit pension plan when he was hired, and once he reaches the 30-year employment mark, he can
retire with full benefits. After many years of working away from home for weeks at a time, Ben is looking
forward to spending more time with his family. Yet, he worries that he might be in a bad accident
someday, leaving his wife, who just turned 61, in dire financial straits. His manager has told him that
if he wants to continue working after 30 years, he could switch to a local delivery route or a desk job
in the office. With those options, he can keep working until he is able to claim his full Social Security
benefit. Ben is glad that he has options, but does not know what he wants to do. He thinks that maybe
he will work for a few years after giving up his job as a long-haul driver, but is not sure that he wants to
work at a desk job until he reaches his Social Security retirement age.
1. If Ben continues working until he reaches age 64, would he be able to claim Social
Security benefits, and if so, what percentage of his full benefit would he receive?
2. If Ben was in an accident and passed away before retiring and claiming his benefit,
would his wife receive any Social Security benefits? Why or why not?
3. Ben is enrolled in a defined benefit pension plan with his employer. How does that
plan differ from a defined contribution program?
Case 2: Amelia is a single 63-year-old woman in semiretirement. She worked full time as a nurse at a
hospital for 35 years, and now works part-time at a private practice. Although she is relatively healthy,
she is not in perfect health. She is slightly obese, takes medication to control her hypertension, and has
had cataracts removed from both eyes. She is also starting to feel the first twinges of arthritis and the
cartilage in her left knee is deteriorating, which will eventually necessitate knee replacement surgery.
Amelia has been able to maintain her health insurance, but it is expensive, and she will not be able to
afford it when she retires. She would like to apply for Medicare as soon as she is able to do so.
The
1. Does Amelia qualify for Medicare now? Why or why not? If not, when will she qualify?
2. Based on Ameila's circumstances, which version of Medicare do you think would be the
snobe best option for her and why?
3. What programs, if any, are available to help Amelia pay for her Medicare plan when
she enrolls if her income is too low for her to afford it?

Answer 1

Answer: Case 1:

1. If Ben continues working until he reaches age 64, he would be able to claim Social Security benefits. At age 64, he would be able to receive 93.3% of his full benefit.

2. If Ben passes away before retiring and claiming his benefit, his wife may be eligible to receive survivor benefits. She can receive a survivor benefit as early as age 60, but the benefit amount will depend on Ben's Social Security earnings record.

3. A defined benefit pension plan guarantees a specific amount of retirement income to employees based on a formula that considers factors such as salary history and years of service. In contrast, a defined contribution program sets aside a portion of the employee's salary into an account that can be invested in stocks, bonds, or other assets.

Case 2:

1. Amelia does not qualify for Medicare yet. She will be eligible for Medicare at age 65, which is the age when most Americans become eligible for Medicare.

2. Medicare Part A and Part B would likely be the best options for Amelia, as they cover hospital and medical services. She may also consider a Medicare Advantage plan if she wants additional coverage.

3. There are several programs available to help Amelia pay for her Medicare plan if her income is too low. The Medicare Savings Program (MSP) and Extra Help program can help with premiums, deductibles, and copayments. Additionally, Medicaid may be available to help cover health care costs for those with low income and limited resources.

Explanation: wow that was alot