Basis and Background of the Retirement Test

/LO that only those older men and s women who have actually retired from employment covered by old-age and survivors insurance will receive benefits under the program, the Social Security Act provides a test of retirement. The test is applicable for both retirement and survivor benefits when the beneficiary is under age 75. If the beneficiary, or the person on whose earnings the benefit is based, has substantial earnings in covered employment (including self-employment), the law requires that his benefit be wiDhheld.1 The test has been the subject of discussion ever since the enactment of the Social Security Act. Current interest in it was stimulated when, on January 14, 1954, in his social security message.2 President Eisenhower asked Congress to enact certain changes in the test. It should, he said, “be liberalized and its discrimination against the wage earner should be removed.” The President pointed out that by “depriving an OASI beneficiary of his benefit payment for any month in which he earns wages of more than $75, present law imposes an undue restraint on enterprise and initiative. Retired persons should be encouraged to continue their contributions to the productive needs of the nation. I am convinced that the great majority of our able-bodied older citizens are happier and better off when they continue in some productive work after reaching retirement age. Moreover, the Nation’s economy will derive large benefits from the wisdom and experi-