An Introduction to Social Security Retirement Benefits

Takeaways

• Social Security is a comprehensive program providing retirement, disability, survivors’, and dependents’ benefits, primarily funded by payroll taxes.
• Retirement benefits are the most common, with eligibility based on 10 years of contributions. Benefit amounts are calculated from the highest 35 years of earnings, with payments increasing if delayed until age 70.
• While a vital income source for many, Social Security payments often need to be supplemented by other retirement income for a comfortable lifestyle.

For 90 years, the Social Security program has been a cornerstone of financial security for American workers and their families. Though most people associate Social Security with retirement checks, the program is actually much broader. The Social Security retirement program is a group of related benefits programs, which includes retirement benefits, disability benefits, survivors’ benefits, and dependents’ benefits. Together, they form a safety net designed to provide income protection across different stages of life.

Of the over 70 million Americans who receive Social Security, 80 percent are older adults, 55 percent are women, and about 10 percent are workers with disabilities and survivors of deceased workers. For 25 percent of U.S. adults, Social Security makes up 90 percent of their income and half of older adults rely on these payments for the majority of their income.

Retirement Benefits Basics

Retirement benefits are the most well-known component of Social Security. Workers who have paid into the system through payroll taxes for at least 10 years become eligible for monthly payments once they reach retirement age. Benefits can begin as early as age 62, but full retirement age (FRA), which is currently between ages 66 and 67, varies depending on birth year.

Delaying benefits until age 70 increases the monthly payment amount. The Social Security Administration (SSA) calculates benefits based on a worker’s highest 35 years of earnings, adjusted for the change in general wage levels. This ensures that higher lifetime earners generally receive larger benefits. For many older adults, Social Security is the largest or even the only source of guaranteed lifetime income, making it essential for financial stability in later years.

The program is financed primarily through a 15.3 percent payroll tax collected under the Federal Insurance Contributions Act (FICA) and the Self-Employed Contributions Act (SECA). This tax is split, with 12.4 percent going to Social Security and 2.9 percent going to Medicare. The 15.3 percent is made up from equal shares paid by employers and employees. Self-employed workers pay the entire 12.4 percent Social Security tax but can deduct half of it as a business expense.

Though the Social Security program is meant to provide a source of income for retirees and their dependents, if they have any, it is often not enough to live on. To live the lifestyle a working person is accustomed to, they have to rely on additional sources of income, such as retirement accounts.

The estimated average amount of retirement benefits paid to retired workers shifts a bit from month to month. As of July 2025, payments are about $2,000 per month for the average retired worker. However, keep in mind that your monthly retirement benefits payment can vary based on your age, work history, how old you were when you filed for benefits, and other factors.

Learn More

For additional reading on topics related to Social Security, check out the following articles:

• Are Social Security Benefits Taxed?
• 10 Ways to Maximize Your Social Security Retirement Benefits
• Could the Trump Administration Privatize Social Security?
• Why the Full Retirement Age Is Now 67, Not 65