How Social Security Works: Types of Benefits What is Social Security in simple terms? Social Security is a government-run program that provides financial assistance to people who are retired, disabled, or widowed. The program is funded through payroll taxes. Employees and employers each pay a 6.2 percent Social Security tax on the first $128,400 of an employee's wages. The tax is deducted from an employee's paycheck. Self-employed people must pay the entire 12.4 percent tax themselves.
The money that is collected through payroll taxes is used to pay monthly benefits to people who are eligible for them. The amount of the benefit is based on the person's earnings history. The Social Security Administration (SSA) uses a formula to calculate the benefit amount.
People who are eligible for Social Security benefits can start receiving them as early as age 62. The full retirement age is 66 for people who were born between 1943 and 1954. It is gradually increasing to 67 for people born in 1960 or later.
People who continue to work after they reach retirement age can do so without affecting their benefits. In fact, working may increase the benefit amount. People who are receiving disability benefits can also work, but there are limits on how much they can earn.
There are two types of Social Security benefits: retirement benefits and disability benefits.
Retirement benefits are paid to people who are retired or who have reached the full retirement age. The benefit amount is based on the person's earnings history.
Disability benefits are paid to people who are unable to work because of a physical or mental condition. The condition must be expected to last at least one year or result in death. The benefit amount is based on the person's earnings history.
Widows and widowers can receive benefits based on their deceased spouse's earnings history. The surviving spouse must be at least 60 years old. What are the types of SSA benefits? There are two types of Social Security benefits: retirement benefits and disability benefits.
Retirement benefits are available to workers who have reached the age of 62. The amount of the benefit is based on the worker's earnings history.
Disability benefits are available to workers who are unable to work due to a physical or mental disability. The amount of the benefit is based on the worker's earnings history. What are the four benefit programs of Social Security? The four benefit programs of Social Security are:
1. Social Security retirement benefits - This program provides financial assistance to eligible individuals who are retired and to their eligible spouses and dependent children.
2. Social Security disability benefits - This program provides financial assistance to eligible individuals who are unable to work due to a disability, as well as to their eligible spouses and dependent children.
3. Social Security survivor benefits - This program provides financial assistance to eligible survivors of workers who have died, as well as to their eligible dependent children.
4. Social Security supplemental benefits - This program provides financial assistance to certain eligible low-income individuals and their eligible spouses and dependent children.