Title page image

Social Security For Dummies®

To view this book's Cheat Sheet, simply go to and search for “Social Security For Dummies Cheat Sheet” in the Search box.


You’re reading this book, so you’re probably thinking about the future — for yourself or for your loved ones. You probably want to know more about the Social Security benefits that could go to you and your family one day and how that money will meet your needs. You may also be thinking about the next phase of your life. Will it be financially comfortable? Will it be a struggle? If you’re like many people, you wonder whether you’re going to outlive your savings. Will Social Security keep you afloat? Can you count on your Social Security benefits? What should you know about the program? How can you find the information you need?

Despite its significance in modern life, Social Security is rarely explained clearly in one place. Not in a way that lays out the program and explains how you fit in, all the protections Social Security offers, and what they mean for you and your loved ones. Not in a way that empowers you to plan right and face the bureaucracy with your eyes open. Not in a way that tells you what you need to know about the rules that affect benefit amounts and eligibility. But understanding this stuff is important — for you and for those who depend on you.

That’s why I wrote this book: to explain the important protections of Social Security in a way that makes sense to the people who earn them and pay for them. (That means you!)

Social Security is big, and it can be confusing. It has an endless assortment of rules, variations on the rules, exceptions to the rules, and exceptions to the exceptions to the rules. The fine print is a big deal. Decisions you make about retirement benefits can have a financial impact for many years, in ways you may not recognize today. Certain areas, such as disability, are especially complicated. No wonder you may be uncertain. It’s not like they teach you this stuff in school.

Everybody has questions about Social Security — questions like these:

  • What’s the best age for me to start claiming benefits?
  • Can I work and also collect Social Security?
  • How does my divorce affect my eligibility for benefits?
  • Will it help my spouse if I wait until 70 to start collecting Social Security?
  • Is the retirement age changing?
  • What’s the best way to contact Social Security?
  • What kind of benefits can go to a spouse or child?
  • Can I solve my problem online?
  • What should I bring with me when I apply for benefits?
  • Will Social Security be there when I need it?

You deserve helpful answers to these important questions and many others — answers that are clear and accurate. After all, Social Security is your program. You own it through the taxes you pay and the benefits you earn. You should know how your personal finances and your work history affect the benefits that land in your bank account. You should know what to expect from the bureaucracy and how to deal with it effectively. And you can find the answers in these pages.

About This Book

Social Security For Dummies walks you through the basics of this critical program: what Social Security is, how you qualify, when to file, how much you’ll get, how much goes to your dependents, and how to contact the Social Security Administration (SSA) to get the information you need. And it does all this in easy-to-understand plain English.

Above all, this book is a reference, which means that you don’t have to read it from beginning to end, nor do you have to read every word, every chapter, or every part. Keep this book on your desk or kitchen counter and pull it out when you need an answer to a specific question. Feel free to skip anything marked with the Technical Stuff icon and anything in a shaded box (called a sidebar); that information is interesting but not essential to understanding Social Security.

This edition makes use of the latest statistics available at the time of writing in 2017 and includes updated information on claiming strategies for married couples, as well as Social Security policy on same-sex marriages and details on personal “my Social Security” accounts.

Within this book, you may note that some web addresses break across two lines of text. If you’re reading this book in print and want to visit one of these web pages, simply key in the web address exactly as it’s noted in the text, pretending as though the line break doesn’t exist. If you’re reading this as an e-book, you’ve got it easy — just click the web address to be taken directly to the web page.

Foolish Assumptions

This book makes a few assumptions about you, the reader:

Icons Used in This Book

Throughout this book, I use the following icons to draw your attention to certain kinds of information.

tip The Tip icon draws your attention to information that can save you time and money, or just make your life easier as you navigate the Social Security system.

remember You don’t have to commit this book to memory, but when you see the Remember icon, you want to pay attention because it flags information that’s so important, it’s worth remembering.

warning The Warning icon signals important information that helps you avoid potentially costly or time-consuming pitfalls.

technicalstuff I use the Technical Stuff icon when I veer into highly technical information — information that adds insight but isn’t critical to your understanding of the topic at hand.

Beyond the Book

In addition to the material in the print or e-book you’re reading right now, this book comes with some bonus information on the web that you can access from anywhere. If you want some answers quickly on some of the most basic parts of Social Security, you can go to the Social Security For Dummies Cheat Sheet. To view this book’s Cheat Sheet, simply go to and enter “Social Security For Dummies Cheat Sheet” in the Search box.

Where to Go from Here

You can skip around this book any way you want. If you’re the sort who reads every word of every book, you can start with Chapter 1 and read all the way through to the end. If you’re looking for information on a particular topic, use the table of contents and index to find what you need. For example, if you’re not sure when you should start collecting Social Security retirement benefits, turn to Chapter 3. If you’re disabled and need information on Social Security Disability Insurance, turn to Chapter 11. Or if you want to know what the future may hold for Social Security, turn to Chapter 17. No matter where you dive in, this book has you covered.

You’ve earned your Social Security benefits. Knowing what you have is always a good idea, and this book provides the information you need.

Part 1

Getting Started with Social Security


Get an overview of the Social Security program and the protections that go to practically everyone: retirees and their dependents, surviving family members, and disabled workers, as well as those who rely on them financially.

Take note, in simple terms, of what you need to know to file for various kinds of benefits.

Discover details on what to consider when deciding to claim benefits.

Find guidance on protecting your Social Security card and number from identity thieves.

Chapter 1

What Social Security Is and Why You Need It


check Knowing what Social Security means for you

check Looking at the value of Social Security

check Considering where your contributions go

check Getting all you can out of Social Security

check Contacting the Social Security Administration

Social Security is the foundation of long-term financial support for almost every American. If you’re like most people, you’ll depend on Social Security to help you survive in your later years (if not sooner). In fact, its protections are becoming even more important as an answer to growing insecurity in old age.

Look around you. If you’re in the workforce, you know that good jobs are hard to come by. If you’re an older worker who loses a job, you may also know it can take a long time to get a new one. Have you been able to set aside money for the future? Saving is essential, but many Americans save little, if anything. Maybe you contribute to a 401(k) at work, if your employer offers one, but who knows how much your investments will be worth next week or next month, let alone many years in the future?

Some of the people who read this book will live to be 100. Maybe you’re one of them. Many people will make it into their 80s and even their 90s. Those years cost money. In a future of risks and unknowns, Social Security is one thing you can count on. Your benefit is guaranteed by law and protected against inflation. But that doesn’t mean it takes care of itself or that you should be a passive participant in Social Security. You have decisions to make, and you can make them better if you have some working knowledge of the benefits you’ve earned. You may also have actions to perform, such as informing the Social Security Administration (SSA) about things that could affect your benefits.

This chapter provides an overview of Social Security and a broad-brush description of benefits. Here, I explain why Social Security was created and why those reasons are highly relevant to Americans today.

Understanding What Social Security Means for You

So, what is this U.S. institution that — sooner or later — plays a role in virtually all our lives?

You can think of Social Security as a set of protections against things that threaten your ability to survive financially — things like getting older and retiring, or having a serious accident or illness that leaves you unable to work. When such things happen, family members who depend on you may not be able to pay for the basic necessities of life.

That’s why Social Security offers a range of benefits. These protections can provide crucial financial security for workers, their immediate family members, and even divorced spouses. For example, Social Security benefits may go to

remember Social Security’s guaranteed monthly payments, set by legal formulas, stand out in a world of vanishing pensions, risky financial markets, rising healthcare costs, and increasing longevity. Although the program faces a potential financial shortfall in the future, its most fundamental features enjoy broad public support.

In the following sections, I look at specific groups of people who benefit from Social Security.

Benefits for retirees

More than 43 million retirees and their spouses get retirement benefits every month. These benefits help millions of people stand on their own two feet instead of relying on their kids or charity or scrambling every month to pay the bills. For about one-third of older beneficiaries, Social Security provides at least 90 percent of their income. But even for people who don’t rely so heavily on Social Security, it provides a solid floor of income in later life.

Although Social Security benefits are generally modest, they help keep 15 million seniors above the poverty line, including many hardworking, middle-class Americans who otherwise would have little to fall back on.

remember Social Security isn’t intended to be your sole source of income. Instead, it gives you a foundation to build on with personal savings and other income.

If you’re already retired (and not rich), you understand the role these payments play in your monthly budget. If you’re still in the workforce but thinking about that next phase of life, here are a few things to reflect on:

  • Social Security is reliable. Its payments don’t rise and fall with the markets on Wall Street or depend on how your company is faring or how well you selected investments. Social Security income lasts a lifetime.
  • Social Security is accessible. Almost all workers are covered. To put this in perspective, just half of workers are covered by an employer retirement plan, and many of these workers do not even participate.
  • Social Security is protected against inflation, a crucial safeguard. Rising prices can slash the value of fixed income over time, driving down your standard of living in retirement.
  • Social Security is especially important for older women. Women tend to live longer than men do, and they have less income to draw on in old age. Elderly widows are exceptionally vulnerable to poverty.
  • Social Security gives a boost to the least affluent. That’s because the benefit is progressive. Poorer individuals get back a larger share of earnings than their higher-paid peers. Social Security benefits replace about 40 percent of the earnings of an average worker.

Benefits for children

Social Security pays more benefits to children than any other government program. More than 4 million children qualify for their own benefits, as dependents of workers who have retired, died, or become disabled. About 6 million children live in households where someone gets Social Security.

The program’s definition of eligible children may include stepchildren and, in some cases, grandchildren and step-grandchildren. Typically, children who qualify may be covered until age 18 — or 19, if they haven’t yet graduated from high school and aren’t married.

Benefits for survivors

The death of a family breadwinner hits everyone under the same roof. That’s why Social Security provides benefits for dependent survivors. Not to overwhelm you with statistics, but this is a significant program with more than 6 million beneficiaries, including children, widows, and widowers. These dependents qualify for benefits if the deceased worker or retiree met certain basic requirements of Social Security. In Chapter 2, I cover the rules, including technicalities that affect widows and widowers.

Benefits for the disabled and their dependents

Almost 11 million Americans get Social Security’s disability benefits, a protection that extends to almost 2 million dependent family members. Social Security’s disability program is complicated, and it can be difficult to meet the standards required for benefits. I devote Chapter 11 to examining the program, as well as Supplemental Security Income (SSI) benefits for beneficiaries with the least income.

Many applicants for Social Security disability benefits are turned down, but these decisions may be reversed in the appeals process. In Chapter 8, I go over your options if Social Security makes a decision you disagree with.

You may not like to think about the risks you take walking out the door, but they may be higher than you realize. Almost four in ten men entering the labor force will become disabled or die before reaching retirement age; the same fate awaits more than three out of ten women.

Table 1-1 provides probabilities of death or disability for young workers (people born in 1996, in this example).

TABLE 1-1 Probabilities of Death or Disability

Probability of …




Death or disability before retirement




Death before retirement (excluding disability)




Disability before retirement (excluding death)




Source: Social Security Administration

Appraising the Value of Social Security

The amount you get in Social Security retirement benefits is based on your earnings history and when you start to collect, factors I examine closely in Chapters 2 and 3. The average retirement benefit is currently about $16,200 per year, and the maximum benefit is more than $32,000 if you claim benefits at full retirement age. You can increase your benefits by taking them after your full retirement age, up to 70, and you reduce them by taking them earlier (typically, as early as 62).

The survivor’s benefit of Social Security is really a life-insurance policy that has been valued at $476,000 for a 30-year-old worker who’s married with two children and has a median salary. The long-term disability protections are valued at $329,000 in coverage for that same family.

Social Security combines other distinctive features that you usually don’t find all in one place. These traits are worth keeping in mind when you’re trying to get a handle on what the program is worth to you:

Understanding How You Pay for Social Security

Social Security is paid for through taxes. (No surprise there.) But you’re not the only one paying into the Social Security pot: Your employer also pays a portion of your Social Security tax. All that money that’s taken out of your paycheck today goes to pay the benefits for today’s retirees.

For the lowdown on how much you pay into Social Security and where it goes, read on.

How much you pay

If you’re a wage earner, you pay into the Social Security system straight out of your paycheck. This payroll tax is dubbed “FICA,” which stands for the Federal Insurance Contributions Act. The Social Security portion of your payroll tax is typically 6.2 percent of earnings up to a certain amount, which is adjusted annually (for 2017, the cap was set at $127,200). Employers also pay 6.2 percent for each employee. In addition, workers and their employers each pay 1.45 percent of all earnings for Medicare’s Hospital Insurance Trust Fund. As of January 2013, individuals who earn more than $200,000 ($250,000 for married couples filing jointly) pay an additional 0.9% in Medicare taxes.

technicalstuff If you’re self-employed, you’re on the hook for both the employee and employer share, which usually adds up to 12.4 percent for Social Security and 2.9 percent for Medicare. This tax is dubbed “SECA,” for the Self-Employed Contributions Act.

Politicians have been increasingly willing to ease the payroll-tax burden in response to economic conditions. In 2011, Congress approved a “payroll-tax holiday” to boost the economy; it lowered the worker’s tax rate to 4.2 percent instead of the usual 6.2 percent. Employers still paid the usual 6.2 percent. The self-employed paid an overall rate of 10.4 percent. (The payroll-tax holiday expired at the end of 2012. And chances of this holiday being reinstated in the near future aren’t good.)

Most workers pay Social Security taxes on all their earnings, because most workers don’t earn above the cap for Social Security payroll taxes. Well more than half — maybe three-quarters — of U.S. households pay more in Social Security taxes than in federal income taxes. Although no one enjoys paying taxes, people tend to accept the Social Security tax because it enables them to earn important benefits.

Where your money goes

The taxes you pay in your working years pay for the benefits for retirees and other beneficiaries who no longer are working. This approach is called “pay as you go.” Think of it as a pipeline that goes from current workers to current beneficiaries.

What the government does with your payroll tax contributions has long been a source of rumor, misunderstanding, and strongly held views. Here are the facts: The Social Security payroll tax deducted from your wages goes into two U.S. Treasury accounts, where it’s used to pay for benefits. Most of the money — about 81 percent — goes into the Old-Age and Survivors Insurance Trust Fund; the remainder goes into the Disability Insurance Trust Fund. These combined trust funds are quite large, with assets of almost $2.8 trillion at the end of 2015.

Tax revenues above and beyond what’s needed to pay benefits are invested in special Treasury securities. These bonds have historically provided extra income for Social Security. Some critics argue that the trust funds could go belly up if the Treasury doesn’t make good on its borrowing. But these bonds are backed by the full faith and credit of the U.S. government, which is still considered a safe investment by investors all over the world.

Although Social Security gets most of its income from payroll taxes, a smaller share comes from interest and some income tax revenues paid by the affluent on their Social Security benefits. (See Chapter 13 for a discussion of income taxes and Social Security.)

Getting the Most Out of Your Social Security Benefits

tip Today’s workers will need all the retirement security they can muster in old age, and for most people Social Security is the centerpiece. Here are some things you can do today to get the most out of Social Security tomorrow:

Getting in Touch with the Social Security Administration

The SSA has one overriding goal (which may be hard to recognize amid all the rules and complexities): to make sure you end up with the correct benefit amount you’re entitled to under the law. Sometimes reaching that goal may not be simple (though it typically is). But whatever the particulars of your case, you may well end up having to contact the SSA to get what you want.

The SSA runs not only the basic Social Security protections for retirement, survivors, and disability, but also SSI for the poor. The SSA also handles applications for Medicare and the deductions in benefits that pay for Medicare premiums. (SSA doesn’t run the Medicare program itself, however. That job is handled by the Centers for Medicare and Medicaid Services.)

That’s a lot of territory to navigate — many rules, many technicalities, and many areas that can be confusing. But knowledge is power when it comes to bureaucracy. Understanding the rules for your particular situation helps. (I go over filing for benefits in Chapter 5, and I hit the high points of maneuvering through the Social Security bureaucracy in Chapter 7.)

Contacting the SSA isn’t difficult. You can go to a local field office, call a toll-free number, or go online:

warning Budget cutbacks have reduced the hours of Social Security field offices and in some cases have led to long lines, as well as longer waiting times on the telephone. As of this writing, field offices are open to the public just 31 hours a week. The general schedule in 2017 is 9 a.m. to 4 p.m. on Monday, Tuesday, Thursday, and Friday, and 9 a.m. to noon on Wednesday.

tip If you’re stretched for time and need to deal with the SSA, it helps to keep a couple of things in mind:

Chapter 2

A Breakdown of Benefits


check Getting Social Security retirement benefits

check Surviving the death of a loved one with help from Social Security

check Relying on Social Security when you can’t work

check Seeing how Social Security protects the poorest of the poor

When you hear about Social Security in the news, it seems like the talk is always about politics. Of course, that matters, but the squabbling in Washington can sound pretty far removed from what really links you to Social Security — the benefits for you and your loved ones. The truth is, many people don’t know all they’re paying for when it comes to Social Security.

In this chapter, I provide a detailed description of the main Social Security benefits: coverage for retirement and a retiree’s dependent family members, protections for surviving family members when a loved one dies, and coverage for disability and a disabled worker’s dependents. In addition, I go over the program of Supplemental Security Income (SSI) for individuals with extremely little income, which is also administered by the Social Security Administration (SSA).

Social Security’s various benefits are meant to address different situations, but they share a common goal: to help individuals and their families meet the fundamental needs of survival. This chapter explains what that means for you.