Social Security

What is Social Security?

Social Security refers to a number of programs that provide workers and their families with benefits when their income decreases because of retirement, disability, or death.

Are all workers covered by Social Security?

No. Certain workers in American have not paid into the Social Security system and are therefore not entitled to its benefits. Other workers may not have a sufficient number of years of “covered employment” (i.e., work credits) to qualify for Social Security.

How are my retirement benefits calculated?

The Social Security Administration (SSA) calculates retirement benefits on income earned during a lifetime of work under the Social Security system. According to the SSA, for current and future retirees, it averages the worker’s thirty-five highest years of earnings.

What is the average Social Security retirement benefit?

According to statistics maintained by the SSA, in 2002 more than 29 million people received Social Security retirement benefits that averaged about $895 per month.

How do I know what my benefit will be?

You can check on your earnings by contacting the SSA. It keeps a running record of your earnings and work credits by tracking through your Social Security number. In addition, the SSA annually mails a Personal Earnings and Benefit Estimate Statement to everyone who is not currently receiving Social Security.

Can I collect more than one benefit from Social Security?

No. You can collect only one type of Social Security benefit even though you may qualify for more. For example, you might be entitled to benefits based on your retirement as well as that of your spouse. You can collect whichever of these benefits is higher, but not both.

When can I start collecting Social Security?

You can start collecting retirement benefits from Social Security at age 62. If you wait to collect your benefit, it will increase for each year you wait up to age 70.

How do I collect benefits when I turn 62?

While you will be eligible for benefits in the month you turn 62, most benefits do not begin until the following month. To receive benefits, you must be 62 for the entire month. You should file a claim with the SSA three months before the birthday on which you become eligible for benefits. This will give SSA time to process your claim and enable you to receive your benefits on time. Be aware that if you file a claim later, you will not get benefits retroactively for months in which you were eligible but before you applied for benefits.

How do I file for benefits?

Contact your local Social Security office or call the SSA at 800-772-1213. Social Security workers should be able to answer general questions about benefits and how to obtain them. They should be able to tell you what paperwork must be completed and what documentation is required. You may also apply for benefits online, using the SSA’s website at

Can I work and still receive Social Security retirement benefits?

Yes. Moreover, the trend is for more and more retirees to work at least part time. If you have reached the full retirement age under Social Security, you can work and earn any amount without losing any of your Social Security benefit.

If I am 62, can I work and still receive Social Security retirement benefits?

Yes, but $1 in benefits will be deducted for each $2 you earn above a limit which is set annually. The limit for 2005 is $12,000. In the year that you reach full retirement age, $1 in benefits will be deducted for each $3 you earn above a certain limit (set at $31,800 for the year 2005). Only the earnings you receive before the month in which you reach full retirement age will be subject to this deduction. In the month you reach full retirement age, you will get your full benefit without any limit on your earnings.

If I work and receive Social Security retirement benefits, will my earnings be subject to Social Security and Medicare taxes?

Yes. Your extra earnings, however, could increase your benefits.

Will my Social Security benefit be reduced by any pension I receive?

Your pension from work will not affect your Social Security benefit as long as the work was covered by Social Security, i.e., you paid Social Security taxes.

Can the SSA assist me with my financial planning?


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