Social Security
BeginnerSocial Security is the United States government programme that provides retirement, disability and survivor benefits, funded mainly by payroll taxes paid by workers and employers.
Workers earn Social Security credits by paying payroll taxes on their earnings. After working long enough, generally about ten years, they qualify for retirement benefits. The amount depends on their highest-earning years, adjusted for wage growth.
People can start receiving retirement benefits from age 62, but benefits are permanently reduced if claimed before full retirement age, which is 67 for people born in 1960 or later. Delaying beyond full retirement age, up to 70, increases benefits. Benefits are adjusted each year for inflation.
For example, a worker might receive a reduced monthly benefit if they claim at 62, a higher amount at 67 and higher still if they wait until 70. The right choice depends on health, other income and family circumstances.
Social Security also provides disability benefits and payments to surviving spouses and children. Because it is funded mainly by current workers, an ageing population puts pressure on the system, and official projections show its trust funds could be depleted in the 2030s unless changes are made. Many other countries have similar state pension and social insurance systems.
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