Social Security is a federal program designed to provide financial support to eligible Americans in retirement, during disability, or after the death of a family member who was a wage earner. Administered by the Social Security Administration (SSA), it is one of the most widely used public benefit programs in the United States.
How Social Security Works
Most workers in the U.S. pay into the Social Security system through payroll taxes, known as FICA taxes (Federal Insurance Contributions Act). Employers also contribute a matching amount. These funds are pooled into a trust, which is then used to pay benefits to current recipients.
To qualify for most benefits, workers must earn “credits” by working and paying taxes. In 2025, one credit is earned for every $1,730 in wages, up to four credits per year. Most benefits require 40 credits, or about 10 years of work.
Types of Social Security Benefits
The Social Security program offers several types of benefits, as summarized in the table below:
| Benefit Type | Who Qualifies | When Payments Start | Notes |
|---|---|---|---|
| Retirement | Workers aged 62+ with 40+ credits | As early as age 62 | Full benefits start at age 66–67, depending on birth year |
| Disability (SSDI) | Workers with a qualifying disability and work history | After 5-month waiting period | Medical evidence of disability required |
| Survivors | Family of deceased workers (spouse, children, etc.) | Varies by recipient’s age | Amount based on deceased worker’s benefit |
| Supplemental (SSI) | Low-income elderly or disabled individuals | Immediately after approval | Funded by general taxes, not Social Security trust fund |
Why It Matters
Social Security plays a vital role in reducing poverty among the elderly, disabled, and families who lose a breadwinner. As of 2024, over 70 million Americans receive some form of Social Security benefit. For many retirees, it represents their primary or only source of income.
Understanding how Social Security works can help you make smarter decisions about when to retire, how to plan for disability, or how to support family members in need. It’s not just a retirement program—it’s a critical safety net for many stages of life.
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