For some households, it makes sense for a worker to start reduced retirement benefits early in order to permit other family members to immediately start collecting Social Security benefits on the workerâs earnings record.
Social Security is a key source of financial support, and keeping track of the changes that happen with the program each year is crucial in order to plan your financial future. Keep these facts in mind, and you'll be better prepared to hit the ground running in 2018.
Social Security is designed to provide retirement support for American workers who pay into the system. It is funded through FICA taxes (FICA stands for the Federal Insurance Contributions Act). The Social Security Administration levies a 12.4% tax on earnings (6.2% is paid by you, and 6.2% is paid by your employer) to fund Social Security benefits. There's a good deal of confusion surrounding Social Security and how this vast program works, so let's go over the basics that every American should know.