What Is Social Security? [How It Works Explained]

Social Security is a type of income.

It is the kind of financial aid that is given from the side of the government to the people who do not have any source of income or getting insufficient income.

Social Security is a strategy that was launched by the US government. It makes sure that every citizen of their country is getting the food, shelter, and the resources that are necessary to lead life.

Social Security is another name of the US social insurance program. It has several benefits for retired, disabled, poor and another group of people.

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History of Social Security

Social Security program has been creating history for long. It was proposed and started in the early 1930s, however, it took 5 long years to implement in the law. On August 14, 1935, US President Franklin D. Roosevelt added the act of Social Security into the law. And, the first payment under this act was made on 1st January 1940.

Social Security is one of the biggest federal programs till the present date. Under this law, the US government is paying billions of dollars to the retired, disabled, poor, and other people every year. In the past few years, the issues have been raised several times for the same.

Till the present date, the Social Security Act has undergone several amendments regarding its rules & systems. According to the 2018 report of SSA (Social Security Administration), around 63 million US residents are receiving the benefit through the Social Security Act and almost 175 million people are paying Social Security taxes.

Financial Security has always been an issue for every under developing, unstable, and rapidly growing countries. Different countries have been dealing with this issue in their way or system.

How to Open Social Security Account

Social Security Account is a kind of digital account which allows you to keep and maintain the records of the benefits which you have received through SSA. If you are curious about this digital Social Security account, then let me help you with some piece of information about it.

Before applying for the online social security account, you must have a valid email address, your social security number, and the proper mailing address of the US. There are certain steps that you need to follow for opening online SSA. These are:

  1. Visit www.socialsecurity.gov/myaccount
  2. Choose the option of “Create An Account”.
  3. You will be asked to provide some basic personal information which will be used to verify your identity.
  4. After providing all the information asked, you need to select a username and the password to complete the process of creating an account.

Several benefits can be achieved by opening a Social Security Account. Some of them are as follows:

  1. You can get proof of income.
  2. You can receive Social Security 1099 form.
  3. In case you have lost your SS card, and you have a Social Security account, then you can easily request for the new one.
  4. You can get customized retirement benefits according to the estimated value.
  5. You can change the method of depositing the amount directly into your account if you have opened the Social Security Account.
  6. Online Social Security Account also allows you to access & manage the account & its important information anytime.
  7. It is easy to operate and ensure to maintain the privacy & security of your account.

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Benefits of Social Security

When you are employed, you need to pay your Social Security taxes. The amount which you pay for taxes is used to provide certain basic benefits to the ones who are retired, disabled, widows, widowers, or poor. There are 5 main types of benefits of Social Security, these are:

  1. Retirement Benefits: Retirement benefits of Social Security are granted around the age of 66. You can even opt for receiving the benefits at the age of 62, but generally, people opt for these benefits after the age of 66. To avail of the retirement benefits, you must have worked a minimum of 10 years. The amount which you will receive after taking the retirement depends upon the income which you earned during your working period.
  2. Disability Benefits: These benefits are given to the people who became disabled for at least 5 months and their condition has not improved. If the condition remains the same for more than 2 years then the person becomes eligible for Medicare benefits.
  3. Benefits for your family: In case the Social Security taxpayer is diseased, then the benefits of Social Security will be given to children and widows, or widowers. On a general basis, the family receives 75% – 100% of the total benefits. This benefit is helpful in many cases. It helps in fulfilling the basic requirement of the family daily and also offers the time to your family members to search for the new job.
  4. Supportive Security Income: Under this section, the people who can avail benefits should be of age 65 years. This income is given to the people who are disabled and poor. As the name says it is the type of supportive federal income that provides support every month for meeting the basic requirements.
  5. Medicare: It is the National Insurance Program for US residents. The minimum age to acquire this benefit on a general basis is 65 years. This benefit is also given to the people who became disabled or going through the medical condition in which they cannot earn.

Importance of Social Security

Social Security is important in many aspects. Some of the important features of Social Security which every US resident earns are as follows:

  1. It is just not the retirement plan, rather it provides life insurance and disability insurance plans as well.
  2. Social Security adds to your monthly income which helps in improvising the living standards & the cost of living.
  3. It offers you the chance to plan your retirement in a much better manner.
  4. Social Security helps almost every old age people to meet their daily requirements.  

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