The Social Security Dividend is a great deal for you and your heirs, as the following charts will show.

A quick summary of the numbers we're talking about appears below. It shows expected benefits and total FICA for a 32 year old working today, listed by average income.

32 years old in 2005 Average Income SSB Earnings FICA $10,000 $7,548 $424,400 $44,986 $30,000 $13,944 $1,298,900 $137,683 $50,000 $19,548 $2,163,300 $229,310 $70,000 $22,548 $3,031,300 $321,318 $90,000 $25,548 $3,807,300 $405,574

Abbreviations: SSB: yearly Social Security Benefit SSC: yearly SSC dividend FICA: lifetime FICA contributions Earnings: lifetime earnings Total SSB: estimated lifetime SSB $100/F: $100 portion of FICA

So, for example, you see that if I am earning $50K now, I can expect to pay a total of $229,310 in FICA toward my retirement*. Now let's see what $100 worth of FICA becomes if the 32 year old retires in 2039.

Now let's compare the return you'll get from $100 worth of SSC. Returns have been adjusted for income tax on $100/F and capital gains tax on SSCs. Remember, SSCs represent twice the FICA, so $100 in SSCs is $200/F.

$100 SSC vs. $100/FICA

Avg income	$10K	$30K	$50K	$70K	$90K
$100/FICA	$12.58/yr	$7.60/yr	$6.39/yr	$5.26/yr	$4.75/yr
$100 SSC	$28.52/yr	$17.22/yr	$14.49/yr	$11.93/yr	$10.76/yr

Owning my Social Security benefits pays over twice as much as your own benefits on a dollar for dollar basis!

Next I have a chart showing the expected total pre-tax dividend from an SSC depending on my lifespan. Each line represents a different average income. Note that these numbers are generic for all workers, except they've paid $100 instead of $50.

That's a deal you just can't afford to pass up.

The actual formula used for calculating the SSC dividend is this:

D = SSB * ($100/F) where:
D	= yearly dividend
SSB	= Total Social Security benefit per year
F	= Total lifetime FICA contribution

You might be thinking you're better off waiting to buy an SSC the month before I retire, since the $100 FICA basis remains constant. But the SSC issue price will be adjusted for inflation each year from 2005 onward. This preserves the relative value of a 2005 SSC vs. a 2038 SSC.

Here is a chart showing the estimated SSC prices adjusted for inflation through 2039.

*All values used for "Earnings" and "SSB" are estimates from www.ssa.gov's benefits calculator. FICA calculations use 10.6% basis that is used for OASI, excluding the 1.8% basis for Disability and 2.9% for Medicare.