The potters herald. [volume] (East Liverpool, Ohio) 1899-1982, 1940-03-21
!. JOHN BROWNS :
!. INSURANCE +.
+ BY +. V. FAULHABER, Manager
+ Youngstown Field Office, Social 4
4 Security Board
4 = 4 4 4 + r 4 4 4 4 = + = = = 4

January 1,1940-John Brown, aged %,
dies, leaving a widow, 26, and 3
children, 2, a, and years old.
January 1, 1940-The Federal Gov
ernment's plan for the payment Of
monthly insurance benefits to work.
ers and their families goes into eff
feet.
Except for the relatives and friends
of John Brown, newspaper readers
paid little attention to the brief no
tice of his death. They found much
more to interest them in the featured
news about monthly payments start
ing under the Federal Governments
plan for old-age and survivors insur-
ance. Yet between the two news items
there is significant relationship.
Had young Brown died at any time
before 1910, his family would have
been in desperate straits. More than
likely they would have had to ask for
public relief; certainly the 3 children
would have had little chance to grow
up in normal surroundings. But since
he died in 1910, Mrs. Brown and the
children may receive more than $12,
600 in social security benefits. A lot
of insurance? Yes, more than man
like Mr.. Brown, who had been earn
ing about $1G0 month, could afford
without the Social Security Act. Not
everyone covered by this national in
surance system will get as much as
the Browns. But their case is good
illustration of how it protects Ameri-
can families when the breadwinner
dies.
The insurance money will be paid to
the Brown family not in lump sum,
but in monthly checks over the period
of their greatest need until the child
rem are grown. At the start, immedi-
ately after her husbands death, Mrs.
Brown will receive monthly checks for
$3.50. Though this is less than they
had before, it will go a long way to-
ward keeping the family together.
These checks for $51.50 will con-
tinue to come each month for IL years
or until the oldest child reaches Is,
if he is still in school. By that time,
Mrs. Brown and her children will have
received 144 checks for $51.50 each, a
total of STAG.
Children stop receiving the "child's
insurance benefits" when they reach
1917 16 if they are no longer going
to school. So after the oldest child
reaches 1S, the Browns will get $45.06
a month until the next child reaches
Is. Two years at $45.O6 month
means $1,0S1.44. BY that time the
family will have received benefits
amounting to $S,497.44.
Then the monthly check drops to
$32.19 month. 1t runs at that figure
until the youngest child reaches 1S-
two years and $77256 more. Then
the checks stop-but not necessarily
for all time. Benefits paid to the
Brown family every month for 16
years, up to this time, will amount to
$9,270.
And for all these benefits John
Brown paid exactly $36-1 per cent of
his $10O monthly wage for the three
years he was covered by the old-age
and survivors insurance system set up
under the Social Security Act.
But that isn't the end Of the pro-
lection his family may get from this
greatly strengthened Social Security
program. By the time the children
are grown and benefits stop, his widow
will be AZ years old. Though this kind
of work doesn't come under the in
surance system, Mrs. Brown can get
monthly benefits again when she
reaches age 65-a widows benefit be-
cause of her husbands past participa-
ton in the plan. This monthly pay
ment would be $19.31 for life after
she reaches 65. With life expectancy
of IL years (the actuaries say that's
about right, she would get total of
$2,7SO 64-and more, of course, if she
lives longer. This would bring the
total of benefits accruing from John
Browns three years of coverage to
more than $4,000.
Why was only S6.44 Topped from
the Browns monthly check when the
first child became 1S? Why was $12.S7
cut off when the next became 49,?
Why did the remaining S32.19 stop
when the youngest child reached 49,?
And why did his widow get $19.31
each month after age 65?
Here are the answers: John Browns
primary insurance benefit would have
come to $25.75 on the basis of his
wage record up to the time of his
death. The young wife with depen-
dent children in her care, gets three
fourths of that. Each child is entitled
to one-half the parents benefit. But
that would have made a total for this
family which would have exceeded the
top limits set in the Social Security
Act. The Act provides that benefits
payable on account of any one work.
er's wage record cannot exceed U
twice his primary insurance benefit,
(2) so per cent of his average month
ly wage, or (3) Ss5. The S51.50 which
the Brown family received while all
the children were under Is was twice