The amount of the reduction in the member’s retirement pay varies with Notes and Brief Reports the proportion that the survivor an- Joint and Survivor 2 or of 4 and 5. Options 1 and 2, when nuity is of the retirement pay and Annuities for Uniformed combined, produce a different result with the age of the wife and children. from that under option 3. Similar@, In addition, the amount of the reduc- Services the result produced by a combination tion depends on whether the annuity The Uniformed Services Contin- of options 4 and 5 differs from that is to be paid as long as either wife and gency Option Act of 1953 (Public Law produced by 6. Under the combination children are eligible and whether the No. 239, Eighty-third Congress, 1st of options 1 and 2, the total survivor full amount of the retirement pay is session) was approved by President annuity payments are less when the to be restored when there is no longer Eisenhower on August, 8. Under this widow is no longer eligible, since pay- an eligible beneficiary. act, personnel of the uniformed serv- ments then are made only on the por- Specific reduction factors have been ices may, by electing a reduced amount tion paid under option 2; the total developed by the Board of Actuaries. of retirement pay during their life- payments are also reduced when no Different factors have been prescribed time, provide benefits for their surviv- child is eligible, since payments then for disabled and nondisabled retirants, ing widow and children. are being made only under option 1. with a further differentiation between The law applies to all officers and On the other hand, under option 3, the the nondisabled retirants now on the enlisted personnel in the Federal uni- same amount, is payable as long as rolls and those coming on the rolls in formed services--the Army, the Navy, there is any survivor eligible to receive the future who must make an advance the Air Porte, the Marine Corps, the an annuity. election. Coast Guard, the Coast and Geodetic The amount of the reduction in re- Consider the operation of these pro- Survey, and the Public Health Service. tirement pay ‘to provide for these visions .for a “typical” case of an indi- A variety of options--both as to benefits is to be determined by the vidual, aged 55, who is a future non- amount and beneficiaries selected-is actuarial equivalent method--that is, disabled retirant and who has a wife available. The law permits the mem- the deductions made from the retired aged 50 and a child aged 10 for whom ber to elect to have his retirement pay pay of the individual will be enough, he has elected a survivor annuity of reduced so that the survivor annuity on the average, to meet the cost bf the I% the reduced retired pay. Under op- may equal %, %, or % of such reduced benefits accruing to his survivor. The tion 1 the reduction would be about amount and also permits him to de- congressional intent, therefore, is that 14.0 percent; in other words, the man cide how his retirement pay is to be no additional cost to the Government would receive 86 percent of his full re- divided. He may, under option 1, elect should be involved in the aggregate, tired pay, and the surviving widow to protect his wife, who will, on his although there may be a different in- would get 43 percent. Under option 4 death, receive an annuity until she cidence of cost. No separate funds or --the “restoration” option--the re- remarries or dies. He may elect to pro- accounts will be established for these duction would be 15.2 percent, or only tect his children (option 21, who will survivor benefits, but rather the ap- slightly larger. Option 3, providing for be paid the annuity until all of them propriations requested to meet the cost both the widow and child, would effect reach age 18, or marry, or die.l Under of pensions will reflect the effects of a reduction amounting to only about option 3, the member would protect this law. Such appropriations will be 0.03 percent more than that under his family-wife and children-and lower by the amount of the reductions option 1. Under option 2, providing the annuity would be payable as long made in the retirement pay of those only for the child, the reduction would as there is an eligible person in the electing an option and will be higher be only 1.1 percent. If the member family. Under these three options the by the amount of the suYvivor annui- chooses survivor annuities of % or t/s. reduction in retirement pay continues ties payable. the reduction would be correspond- for the life of the retired member. The new law establishes a Board of ingly less. If, for example, he selects Three other options are also open to Actuaries, which will select the appro- option 1, with a survivor annuity of the members. Annuities under options priate mortality and remarriage tables %, his retirement pay would be re- 4,5, and 6 are payable under the same to be used. This Board consists of the duced about 4 percent, so that he terms and conditions as in options 1, Government Actuary in the Treasury would receive about 96 percent of his 2, and 3, with the additional provision Department, the Chief Actuary of the full retirement pay, and his widow that no further deductions are to be Social Security Administration, and would get about 12 percent. For dis- made from the member’s retirement an actuary to be appointed by the abled retirants the reductions are pay after there is no longer a benefl- President from the membership of the somewhat greater than for nondis- ciary eligible to receive, on the death Society of Actuaries. In addition to abled retirants. For those nondisabled of the member, a survivor annuity. selecting the appropriate actuarial retirants now on the rolls or coming The member may elect any one op- tables, the Board of Actuaries will ad- on the rolls before , the re- tion or a combination of options 1 and vise in the administration of the pro- ductions fall between those for the gram. Each uniformed service will other two categories. Thus, if the typi- 1An annuity is payable beyond age 18 to a mentally defective or physically administer the provisions, using the cal case described above were a dis- handicapped child who has been continu- reduction rates developed by the abled retirant, under option 1 the re- ously in that condition since age 18. Board of Actuaries. duction would be 21.1 percent; if he

Bulletin, November 1953 19 were a nondisabled retirant currently the time of his retirement were all requested. A revocation, once made, is on t.he rolls the reduction would be 18.6 over age 18. would then in effect be final after the expiration of the 5-year percent. under option 1. Members retired for period. The election must be made before physical disability before they have The advance-election provisions are the individual completes 18 years of had 18 years of service may make the designed to avoid the adverse selection service and is effective only if there is election at the time of retirement. that would occur if all individuals were one or more of the designated types of Those in active service for more than permitted to make the election at the beneficiaries living on the date of his 18 years and those already retired time of retirement. The usual practice subsequent retirement. Thus, an un- must make their election within 180 with this type of benefit is to require married individual upon attainment of days of the effective date of the bill election before the individual reaches 18 years of service could elect option 1, (November 1, 1953). An election once a certain age, such as 60. A procedure but this election would have no effect made may be modified or revoked be- of this kind is not practical here be- if he was not married when he retired. fore retirement, but the action is effec- cause retirement from the uniformed Similarly, the retirement pay for a tive only if the member does not re- services is influenced more by length man with a wife and children who tire within the next 5 years after the of service than by attainment of a elected option 3, but whose children at modification or revocation has been fixed minimum age, such as 65.

RECENT PUBLICATIONS Adjustment of Retired School groups in providing better living con- (Continued from page 2) Teachers.” Journal of Gerontol- ditions for the aged. ogy, Baltimore, Vol. 8, , OAHUHEALTH COUNCIL and HONOLULU CURTIS, CARL T. “Some Problems in pp. 333-338. $2.50. COUNCILOF SOCIAL AGENCIES. STUDY Social Security.” American Eco- BUCKLEY,JOSEPH C. The Retirement COMMITTEEON THE AGED. A Stucly nomic Security (Chamber of Com- Handbook: A Complete Planning of Oahu’s Aged. Honolulu, Hawaii: merce of the U.S.A.), Washington, Guide to Your Future. New York: The Committee, July 1953. 35 pp., Vol. 10, May-July 1953. pp. 28-36. Harper & Brothers, 1953. 329 pp. and 39 tables. 25 cents. $3.95. PRUSSIN,DOROTHY V. “Helping Older An address by the chairman of the DONAHUE,WILMA; RAE,JAMES, JR.; and Persons Remain in the Commu- House Ways and Means Subcommittee BERRY,ROGER B., editors. Rehabili- nity.” Public Welfare, Chicago, on Social Security, before the Na- tation of the Older Worker. Ann Vol. 11, July 1953, pp. 103-105. $1. tional Conference of Social Work. Arbor : University of Michigan Describes New York City’s boarding DILLICK, SIDNEY. Community Organ- Press, 1953. 200 pp. $3.25. home program. ization for Neighborhood Develop- Papers presented and discussions at TAIETZ, PHILIP. Administrative Prac- ment-past and Present. New the University of Michigan’s fourth tices and Personal Adjustment in York: Woman’s Press, 1953. 198 annual conference on aging. Homes for the Aged. (Cornell Uni- PP. $4. DUTCHESS,CHARLES E. “A Retirement versity Agricultural Experiment KYRK, HAZEL. The Family in the Policy : Recommendations and Cri- Station, Bulletin 899.1 Ithaca: American Economy. Chicago: Uni- teria.” Industrial Medicine and New York State College of Agricul- versity of Chicago Press, 1953. 40’7 Surgery, Chicago, Vol. 22, Aug. 1953, ture, July 1953. 39 pp. PP. $6. pp. 349-351. 75 cents. Analyzes the adjustments made by The economic position of the Amer- Recommends elimination of a com- the residents of three homes for the ican family in terms of income, prices, pulsory retirement age and establish- aged in New York State. and standards of living. ment of more precise standards of U. S. CIVIL SERVICECOMMISSION. LI- measuring the mental and physical BRARY. ‘The Older Worker: An An- U. S. CONGRESS.HOUSE. COMMITTEE competence of aging workers. ON GOVERNMENTOPERATIONS. IN- notated Bibliography.” Public Per- TERCOVERNMENTALRELATIONS SUB- 1~~0, IRVING D. “Tax Free Earning sonnel Review, Chicago, Vol. 14, COMMITTEE. Commission on Inter- for Retirement: An Analysis of the July 1953, pp. 133-140. $2. Proposed ‘Individual Retirement governmental Relations and Com- Public Welfare and Relief mission on Organization of the Ex- Act of 1953’.” Wisconsin Law Re- ecutive Branch of the Government. view, Madison, Vol. 1953, July 1953, ASHDOWN,MARGARET, and BROWN,S. Hearings, 83d Congress, 1st Session pp. 581-634. $1. CLEMENT. Social Service and Men- . . . Washin&on: U. S. Govt. Print. Proposal to allow a person to create tal Health: An Essay on Psychiatric off., 1953. i95 pp. a tax-exempt retirement fund and to Social Workers. London: Rout- subtract for that purpose as much as ledge & Kegan Paul. Ltd., 1953. Retirement and Old Age 10 percent from his taxable income 260 pp. 16s. each year. Traces the careers of a group of BACHO, PAUL. An Analysis of the NEW YORK STATE ASSOCIATIONOF psychiatric social workers from their Characteristics of the Residents at COUNCILSAND CHESTS. COMMITTEE selection through 10 years of employ- the Home for the Aged and Infirm ON SHELTER CARE FOR THE AGEDAND ment, to evaluate the methods used in of the District of Columbia. Wash- INFIRM. A Home in the Later Years. their selection and training. ington: Board of Public Welfare, New York: . 41 pp. Processed. The Association, 1953. COUNCILOF SOCIALWORK EDUCATION. 29 PP. Workshop Reports: 1953 Proceed- BRITTON, JOSEPHH. “The PevMnal Designed as a guide for community ings, Annual Program Meeting,

20 Social Security