Abby1930, In some pension systems, your contribution toward your pension is a percentage of your annual income and your pension at retirement relates to the amount that all of those years' contributions totalled out to, plus the amount of growth that all of those invested dollars produced throughout the period. I hope that you can find some source of income which will be such that you can continue to enjoy your new home. Lay-offs have become an increasingly common problem in the economy these days, where many companies feel that employees are as disposable as the machines that they use. Should we call such an approach "Kleenex staffing"? They like loyalty on the part of staff - but if it isn't a two-way street, that rather traditional loyalty situation will be eroded. In fact - it is, these days. Few employees feel as loyal to their employer as was true a generation ago. Telecoms have certainly been volatile in recent years - and increasingly so? While talking to my recently laid-off daughter (who had for several years been a counsellor to people being laid-off), she said that she'd like to have two or even three streams of income - so that she wouldn't be up the creek without a paddle if she suffered lay-off, having depended totally on one income. She's a rather independent-minded person. Who was able to carry on her recent work wherever she happened to be - all that she needed was a higher-grade connection to the internet. She used so much bandwidth that one couldn't call her and have the call go through while she was using the line for corporate-related internet work, as one can do with most internet users using high speed connection. Good wishes to you as you work through your situation in the days ahead. joyful guy P.S. to others: If you should find yourself in this situation (say, next week?) - wouldn't it ease your concerns a great deal if you knew that you had enough assets rather easily available to enable you to survive without too much upset should you, having suffered the trauma of lay-off, find yourself unable to find other work for half of or even a whole year? Personal financial advisors for many years have been recommending 3 - 6 mos. emergency fund to enable minimum survival. Such a plan is much more necessary in the employment climate, these days. Don't you think? I remember a song that was popular when I was young, ... "Wishing, will make it so, just keep on wishing, and care will go." "Dreamers tell us dreams come true, it's no mistake and wishes are the dreams we dream while we're awake". Baloney. Visioning has its place. So do dreams - and wishes. The problem is that quite a number of us allow the dreams and wishes to take the place of reality, rather than encouraging and impelling us to implement them - to change them from a figment of our imagination into a real part of our lives. Dream the dream - then make it work. ...

Your SS benefits are not based on the last year you worked. It looks at your highest paid 35 years over your entire working career. It goes something like this: The calculation will be made over 35 years which is 420 months. First, your record is searched for 35 highest paid years. If you do have that many, then there will be some years counted as zero years. Next, the older years are indexed to sort of bring them up to todays dollars. The factors used is something like a cost-of-living adjustment, but in my humble opinion, the adjustment falls short of the actual inflation rate. However, the same index is applied to everybody be they rich or poor. For example, if you earned $100 30 years ago, the adjustment factor might be 4.5, so your $100 income made 30 years ago would be adjusted to 4.5 x 100 or $450 in current dollars. This is done for each year using a different factor for each year. If there are zero years, these are included also. The 35 highest paid years are used or all the years if there is less than 35. All of the adjusted years are totaled and then divided by 420, the number of months in 35 years. This becomes the average monthly income figure that is used to determine your benefit. Clear as mud? I hope it is a little better than that. Go to the social security site to find this information. The indexing list should be there and it may change some for each passing year. The formula for using the average indexed monthly taxed earnings for computing the benefit should be there.

Some of these rules don't make sense to me. It sure seems like there are a lot of ways to get far more social security benefits than were ever paid in. I don't blame people for taking advantage of the rules in place but I sure don't understand them. I understand and agree with survivor benefits but I really don't understand how a non-working spouse can get half of the working spouses benefits despite never paying in. It seems that it should be distributed at a household level based on household income if the marriage is maintained into retirement. It also doesn't make sense to me that multiple ex's can all collect the same amount. I don't understand how the system can sustain itself by paying out so much more than was contributed. But I guess that's why it's supposedly going bankrupt. If I'm wrong about any of these, please correct me as I would love to know the truth. My research has only shown me tips and tricks to maximizing benefits. I've been paying social security for 10 years and have another 35 to go. I really wish it were optional because I am pretty sure I will never see this money again.

It is prorated.