Definition
The Social Security Act is a landmark piece of legislation in the United States, signed into law by President Franklin D. Roosevelt on August 14, 1935. The Act established a social insurance program designed to pay retired workers age 65 or older a continuing income. The original goal of the Social Security Act was to provide financial stability for older Americans who were left particularly vulnerable due to the economic challenges of the Great Depression.
Examples
Retirement Benefits
A common example of Social Security benefits is monthly retirement payments to individuals who have reached the age of retirement and have paid into the Social Security system during their working years.
Disability Insurance
The Social Security Disability Insurance (SSDI) program provides income to people who are unable to work due to a qualifying disability that is expected to last at least one year or result in death.
Survivors’ Benefits
Survivors’ benefits are payments to family members of deceased workers who paid into the Social Security system. For instance, a widow(er) with children may receive benefits to support their household following the worker’s death.
Frequently Asked Questions
What is the primary purpose of the Social Security Act?
The Social Security Act’s main purpose is to provide financial assistance to retirees, disabled persons, and families of deceased workers to ensure continued income for individuals who cannot work.
Who qualifies for Social Security benefits?
Eligibility for Social Security benefits depends on several factors, including age, employment history, and contributions to the Social Security system through payroll taxes.
How is Social Security funded?
Social Security benefits are funded primarily through payroll taxes under the Federal Insurance Contributions Act (FICA). Employees and employers each pay a specified percentage of wages into the Social Security Trust Fund.
Can Social Security run out of funds?
While the Social Security Trust Fund is projected to face funding challenges, it is unlikely to run out completely. Potential shortfalls can be addressed through policy changes such as adjustments to tax rates, benefits, or eligibility requirements.
How do I apply for Social Security benefits?
You can apply for Social Security benefits online via the Social Security Administration (SSA) website, by phone, or by visiting a local SSA office.
Related Terms
Social Security Number (SSN)
A unique number assigned to U.S. citizens and eligible residents used to track earnings and benefits under the Social Security program.
Federal Insurance Contributions Act (FICA)
U.S. law requiring a payroll tax on both employers and employees to fund Social Security and Medicare.
Old-Age, Survivors, and Disability Insurance (OASDI)
A comprehensive federal benefits program under the Social Security Act providing retirement, disability, and survivors benefits.
Online References
- Social Security Administration (SSA) website: https://www.ssa.gov
- USA.gov Social Security information page: https://www.usa.gov/social-security
Suggested Books for Further Studies
- “The Social Security Administration and Disability: A Comprehensive Collection of Listings” by SSA.
- “Social Security: A Fresh Look at Policy Alternatives” by Peter A. Diamond.
- “The Politics of Social Security in the United States” by Jorge J. E. Grandi.
Fundamentals of Social Security Act: Public Policy Basics Quiz
Thank you for exploring the comprehensive details of the Social Security Act with us and completing our quiz on its fundamentals. We hope this has enriched your understanding of one of the most critical social welfare programs in American history!
