Nationwide® Retirement Plans Participant Education

Learning about Social Security

The basics. The strains. Planning.

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It’s important to understand the funding that’s available to

you at retirement. Most Americans are eligible for Social

Security, so we’ll help educate you on how it works.

Use this brochure to learn about Social Security and how

to calculate your benefits at retirement. Then, you can

realistically assess how your retirement plan account fits

into your overall needs.

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The basics of Social Security

What is it? Who is eligible? What are the benefit payments based on?

A federal institution that:

•Provides benefits to retired people and qualified disabled people1

•Has existed for more than 77 years

•Providers for more than 161 million workers2

Most Americans are eligible by making payments through their paycheck. Paying into the system is part of the Federal Insurance Contribution Act (FICA).3

What you get depends on:

• “Credits” earned during the year

•The age you choose to receive benefits4

•Contributions made based on your Social Security number

Once you understand some of the more basic elements of Social Security, like what these benefits are, who is eligible and who isn’t, you can understand how the benefits work for your overall plan.

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Earning and receiving Social Security

What are credits? How are credits earned? When can benefits be received?

Credits are:

•Building blocks used to determine benefit amount4

•A minimum must be earned to be eligible for benefits4

•Accumulation occurs throughout your career even with gaps in your history4

One credit is earned for every $1,160 earned in taxable wages. A maximum of four credits can be earned during a calendar year. The income equivalent to earn a credit is adjusted yearly.4

You decide on:

•Full retirement age — age you can receive full benefits and varies based on age1

•Early retirement age — begins at age 62 and results in reduced benefit1

•Deferred retirement — any age after full retirement; the longer the deferment the more the payment1

You should understand that the benefits you receive are determined by how much you’ve contributed to the system and at what age you started contributing. These amounts are tracked by your Social Security number.

Age to receive full Social Security benefits

Year of birth Full retirement age

1943 - 1954 66

1955 66 & 2 months

1956 66 & 4 months

1957 66 & 6 months

1958 66 & 8 months

1959 6 & 10 months

1960 & later 67

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The strains on Social Security

Limited amounts People are living longer More people are receiving benefits

People need 70% of their current salary to live in retirement. Social Security accounts for only 40%.5

The rule of 63/36:

•For a couple both aged 54, there is a 63% chance one member will live to 90 and a 36% change one will live to be 95.

•Life expectancy projections are getting longer

From 1965 to 2011:

•The U.S. population has increased by 60%6

•The number of recipients of Social Security has increased by 533%6

Projection between 2011 and 2030:

•People eligible for benefits will increase by 65%6

•People paying into Social Security will increase by 15%6

While Social Security is a benefit most of us will receive in retirement, there are strains on the system that you should be aware of.

Year cohort turned 65

Percentage of population surviving from age 65

Average remaining life expectancy for those surviving to age 65

Female Male Female Male

1940 53.9 60.6 12.7 14.7

1950 56.2 65.5 13.1 16.2

1960 60.1 71.3 13.2 17.4

1970 63.7 76.9 13.8 18.6

1980 67.8 80.9 14.6 19.1

1990 72.3 83.6 15.3 19.6

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Your overall retirement strategy

Social Security was never meant to fully support individuals in retirement. But, there are resources to help you plan for retirement and supplement your Social Security.

Estimating your benefits Your retirement plan account On Your Side Interactive Retirement PlannerSM

Create a “My Social Security Account” online at www.socialsecurity.gov to view what you’ve paid into the system and what your estimated benefits will be at retirement.

Consider increasing contributions to your retirement plan account to maximize the power of tax-compounding and rely less on Social Security.

This resource at nationwide.com helps you find your retirement gap, set a plan for retirement and track your progress.

Consider other sources of

income such as your

401(k) plan or IRA

The sooner you begin saving, the more you’ll

have at retirement

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Estimating your benefits On Your Side Interactive Retirement PlannerSM

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To learn more about Social Security and how your retirement

plan fits into your overall strategy, call us or log on today.

1-800-772-2182

nationwide.com/myretirement

1 Retirement Benefits, Social Security Administration (April 2013).

2 Social Security Administration Basic Facts, Social Security Administration (February 2013).

3 Internal Revenue Code, 26 USC Chapter 21, Federal Insurance Contribution Act.

4 How You Earn Credit, Social Security Administration (January 2013).

5 Social Security Planner: Learn About Social Security Programs, Social Security Administration (April 2013).

6 Covered Workers and Beneficiaries, United States Social Security Administration, Of the Chief Actuary (April, 2012).

For more information about the available underlying investment options, including all charges and expenses, please consult a fund prospectus by calling 1-800-626-3112 or visiting nationwide.com. Fund prospectuses and additional information relating to your retirement plan can be obtained by contacting your Retirement Plan Representative. Before investing, carefully consider the fund’s investment objectives, risks, charges and expenses. The fund prospectus contains this and other important information. Read the prospectus carefully before investing.

The Nationwide Group Retirement Series includes unregistered group fixed and variable annuities and trust programs. The unregistered group fixed and variable annuities are issued by Nationwide Life Insurance Company. Trust programs and trust services are offered by Nationwide Trust Company, FSB, a division of Nationwide Bank.

Nationwide Investment Services Corporation, member FINRA. In MI only: Nationwide Investment Svcs. Corporation. Nationwide Mutual Insurance Company and Affiliated Companies, Home Office: Columbus, OH 43215-2220.

Nationwide, Nationwide Financial, the Nationwide framemark and On Your Side Interactive Retirement Planner are service marks of Nationwide Mutual Insurance Company.

© 2013 Nationwide Financial Services, Inc. All rights reserved.

PNM-2653AO (12/13)

For Participant Use Only

To learn more about Social Security and how your retirement plan fits into your overall strategy, call us or log on today.

1-800-772-2182

nationwide.com/myretirement