Social Security

How does Social Security work?

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Jana Leon—Getty Images

The program, established in 1935, is based on contributions that workers make into the system. While you’re employed, you pay into Social Security; you receive benefits later on, when it’s your turn to retire. Contributions take the form of the Federal Insurance Contributions Act (FICA) taxes that are withheld from most paychecks.

Medicare benefits are commonly considered part of Social Security benefits, although technically Medicare is a separate program.

In addition to retirees, the program also funds benefits for those who become disabled, as well as widows of those currently receiving Social Security. Your spouse and children can also receive Social Security survivor benefits after you die.

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