Social Security is a cornerstone of the United States’ ssndob net, providing financial support to millions of Americans during their retirement years and in times of disability or loss of a family breadwinner. Established in 1935 as part of President Franklin D. Roosevelt’s New Deal, Social Security has evolved over the decades to address the changing needs of society. This article aims to provide a comprehensive guide to understanding the Social Security system, its various components, eligibility criteria, and the challenges it faces.
I. Social Security Basics:
Social Security is primarily funded through payroll taxes collected from workers and their employers. The Federal Insurance Contributions Act (FICA) mandates the contributions, which fund three main programs:
- Retirement Benefits: Social Security provides a steady income stream for retirees. The amount an individual receives is based on their earnings history, with higher earners generally receiving higher benefits.
- Disability Benefits: If an individual becomes disabled and unable to work, they may be eligible for Social Security Disability Insurance (SSDI). Eligibility is determined by a thorough evaluation of the person’s medical condition and work history.
- Survivor Benefits: Social Security provides financial support to the surviving family members of deceased workers. This includes spouses, children, and, in some cases, dependent parents. Survivor benefits are calculated based on the deceased worker’s earnings.
II. Eligibility and Application Process:
To qualify for Social Security benefits, individuals must accumulate enough work credits. Work credits are earned based on the individual’s total yearly wages or self-employment income. The number of credits needed for eligibility depends on the type of benefit sought (retirement, disability, or survivor benefits).