Social Security


Social Security affords vital income protection to workers and their families. But it is more than a retirement program. Social Security is a social insurance and family income-protection plan. First, it provides income to retired workers, workers who become disabled, and their spouses. Second, it offers support to spouses and dependent children of wage earners who die or become disabled during their working lives.

Several features of Social Security provide a strong foundation for economic security. The calculation of initial benefits ensures that they reflect current living standards, which tend to rise over time. Benefits are adjusted annually for inflation. Unlike savings accounts, which can be exhausted, Social Security benefits last a lifetime. Social Security uses a progressive benefit formula. This ensures that Social Security replaces a higher percentage of earnings for people with low wages than for people with high wages.

Social Security plays a crucial role in reducing poverty among older people. It particularly aids women and historically disadvantaged racial and ethnic groups. Without Social Security, 38 percent of all older Americans would be in poverty. Instead, only about 10 percent were below the poverty line in 2018.

Social Security is the primary source of retirement income for most Americans. About half of people age 65 and older depend on Social Security for at least 50 percent of their retirement income. About one-quarter rely on Social Security for at least 90 percent of their income.