What a Social Security benefit is

A Social Security benefit is a monthly payment you receive from the federal government based on your work history or your family connection to someone who worked and paid Social Security taxes. The amount you get depends on how much you earned during your working years, when you start taking payments, and which type of benefit you receive. Most people think of Social Security as retirement income, but the program also pays benefits to people who are disabled, to surviving family members after a worker dies, and to spouses and children of retired workers.

The Social Security Administration (SSA) keeps a record of your earnings throughout your career. When you reach a certain age or meet other conditions — like having a disability — you can start receiving monthly payments. These payments continue for life in most cases, though the exact amount adjusts each year based on inflation.

Key Takeaways

  • Social Security benefits are monthly payments based on your work history, and the amount depends on your earnings record and the age you start receiving payments.
  • Retirement benefits typically start at age 62, but waiting until age 70 results in a significantly larger monthly payment.
  • Disability and survivor benefits are also available to people who have not yet reached retirement age, based on a worker's Social Security record.
  • You can view your earnings record and estimated benefit amounts through your personal Social Security account at ssa.gov.
  • The SSA sends benefit payments by direct deposit, check, or debit card, and the amount you receive is subject to federal income tax in some cases.

The three main types of Social Security benefits

Retirement benefits are the most common type. You can start receiving them as early as age 62, but your monthly payment will be smaller than if you wait. If you wait until your full retirement age — which ranges from 66 to 67 depending on your birth year — you receive your full benefit amount. If you delay until age 70, your monthly payment increases by roughly 8 percent for each year you wait past your full retirement age.

Disability benefits go to people under full retirement age who have a medical condition expected to last at least 12 months or result in death. You do not have to be retired to receive them. The SSA has a strict definition of disability, and you will need medical evidence to support your claim. Family members of a disabled worker — including a spouse and children — may also receive benefits on that worker's record.

Survivor benefits are paid to family members when a worker dies. A surviving spouse, ex-spouse, children, and sometimes parents can receive monthly payments based on the deceased worker's earnings record. The total amount paid to all family members combined is limited, but individual family members can each receive a portion.

How the SSA calculates your benefit amount

The SSA uses your 35 highest-earning years to calculate your benefit. If you worked fewer than 35 years, zeros are counted for the missing years, which lowers your average. Your earnings are adjusted for inflation using a formula that accounts for wage growth in the economy during your working years.

Once the SSA determines your average indexed monthly earnings, it applies a formula that replaces a higher percentage of lower earnings and a lower percentage of higher earnings. This means the benefit formula is progressive — it provides a larger replacement rate for people with lower lifetime earnings.

The age you start receiving benefits also affects your monthly amount. Starting at 62 reduces your payment by roughly 30 percent compared to waiting until full retirement age. Starting at full retirement age gives you your standard benefit amount. Waiting until 70 increases it by roughly 24 to 32 percent, depending on your birth year.

How to check your earnings record and estimated benefits

You can create a personal account at ssa.gov to view your earnings history and see an estimate of your future benefits. The SSA records your earnings each year based on the Social Security taxes withheld from your paychecks. If you see an error — such as earnings that were not credited to your account — you can report it to the SSA with documentation like a W-2 or tax return.

Your online account shows estimates for retirement, disability, and survivor benefits. These estimates assume you continue working at your current earnings level until retirement age. The estimates update each year after the SSA posts your latest earnings, usually in March or April.

If you do not have an online account, you can request a benefit estimate by mail or phone. The SSA also mails a Social Security Statement to people age 60 and older who do not yet have an online account, though you may need to request it.

When you can start receiving benefits

For retirement benefits, the earliest age is 62. Your full retirement age — when you become may have access to to your full benefit amount — depends on your birth year. People born in 1943 or later have a full retirement age between 66 and 67. If you were born in 1960 or later, your full retirement age is 67.

For disability benefits, there is no minimum age. You can receive them at any age if you meet the SSA's definition of disability and have enough work credits in your record. Work credits are earned by paying Social Security taxes; most people need 40 credits total, with at least 20 earned in the 10 years before becoming disabled.

Survivor benefits can be paid to family members of any age, though children must be under 19 (or 19 if still in high school), and spouses must be at least 60 years old — or 50 if disabled — unless they are caring for a child under 16.

How you receive your monthly payment

The SSA sends benefits by direct deposit to your bank account, by check mailed to your address, or onto a debit card issued by the SSA. Direct deposit is the fastest and most find method. If you choose direct deposit, the payment typically arrives on the third or fourth Wednesday of each month, depending on your birth date.

If you receive a check, it arrives by mail and may take longer to clear. The debit card option, called the Direct Express card, works like a regular debit card and allows you to withdraw cash at ATMs or make purchases.

Once you start receiving benefits, the SSA adjusts your payment each January based on the Cost of Living Adjustment (COLA). This increase is meant to help your benefits keep pace with inflation. In years when inflation is very low, the COLA may be zero.

Taxes on Social Security benefits

Depending on your total income, some of your Social Security benefits may be subject to federal income tax. The SSA uses a formula based on your "combined income," which includes your adjusted gross income, nontaxable interest, and half of your Social Security benefits. If your combined income exceeds certain thresholds — $25,000 for single filers and $32,000 for married couples filing jointly — up to 50 percent or 85 percent of your benefits may be taxable.

You can request that the SSA withhold federal income tax from your benefit payment if you expect to owe taxes. Otherwise, you will need to pay taxes when you file your annual tax return. Some states also tax Social Security benefits, though most do not.

Frequently Asked Questions

What happens to my benefits if I work while receiving Social Security?

If you are under full retirement age and earn more than a certain amount per year, the SSA will reduce your benefits by $1 for every $2 you earn above the limit. The limit changes each year. Once you reach full retirement age, there is no earnings limit, and you can work as much as you want without affecting your benefits.

Can I change my mind after I start receiving benefits?

You can withdraw your benefit claim within 12 months of starting to receive payments, but you must repay all benefits you received. After 12 months, you cannot withdraw your claim. However, if you have reached full retirement age, you can suspend your benefits to allow them to grow, though this is rarely done today.

What is the difference between my full retirement age and my early retirement age?

Your full retirement age is when you become may have access to to your standard benefit amount. Early retirement age is 62, the earliest you can start receiving benefits. Starting at 62 means a permanently reduced monthly payment — roughly 30 percent less than your full retirement age amount.

How do I report a change in my circumstances to Social Security?

You can report changes like a name change, address change, or change in work status through your online account at ssa.gov, by phone at 1-800-772-1213, or by visiting a local Social Security office. Some changes may affect your benefits, so it is important to report them promptly.

Can family members receive benefits on my Social Security record?

Yes. Your spouse, ex-spouse, and children may be may have access to to benefits based on your work record. A spouse can receive benefits at full retirement age or as early as 62 with a reduced amount. Children can receive benefits until age 19 if still in high school, or age 18 otherwise, and disabled adult children may receive benefits for life.