Learn About the Social Security Administration

What the Social Security Administration Does

The Social Security Administration, commonly called the SSA, is a federal agency that manages several important programs for Americans. Understanding what this organization does can help you learn about services that may be available to you or your family members. The SSA was created in 1935 and has grown to serve millions of people across the country.

The primary role of the SSA is to administer Social Security retirement benefits, which provide income to people who have worked and paid Social Security taxes throughout their careers. Beyond retirement, the agency manages several other programs. These include Social Security Disability Insurance, which provides support to working-age people with severe disabilities, and Supplemental Security Income, a needs-based program for older adults, blind individuals, and people with disabilities who have limited income and resources.

The SSA also handles the Medicare program in coordination with the Centers for Medicare and Medicaid Services. While Medicare itself is run by a different part of the government, the SSA plays a role in enrollment and managing related records. Additionally, the agency maintains detailed earnings records for nearly every worker in the United States, which affects how much income someone may receive from Social Security later in life.

One critical function of the SSA is issuing Social Security numbers. These nine-digit numbers are used for employment, banking, credit, and many other purposes in American society. The agency processes millions of requests for Social Security cards each year, including cards for newborns and immigrants becoming U.S. citizens.

The SSA operates through a network of local field offices, hearings offices, and payment centers located throughout the country. These offices serve as the direct connection between the public and the agency's services. Staff members in these offices can answer questions about various programs and help people understand what information they may need to provide to the agency.

Practical Takeaway: The SSA manages multiple programs beyond just retirement benefits. Learning what each program covers can help you understand which services might relate to your situation or the situation of people you know.

Social Security Retirement Benefits Explained

Social Security retirement benefits form the foundation of what the SSA does. These monthly payments go to retired workers who have paid Social Security taxes during their working years. The program was designed to provide a foundation of income in retirement, though most financial experts suggest it should be part of a broader retirement plan that includes personal savings and investments.

To receive Social Security retirement income, workers must have paid Social Security taxes for a certain number of years. Specifically, a person generally needs to have earned 40 credits through Social Security-covered work to be able to receive retirement benefits. A credit is earned for a specific amount of wages or self-employment income paid in a year. In 2024, one credit is earned for every $1,730 in covered earnings, with a maximum of four credits per year. This means most people can accumulate the necessary 40 credits by working for about 10 years in jobs covered by Social Security.

The amount of monthly retirement income someone receives depends on several factors. The primary factor is the person's average earnings during their working years, specifically their highest 35 years of earnings. Workers can start receiving benefits as early as age 62, but the monthly amount will be reduced compared to what they would receive at their full retirement age. Full retirement age varies depending on when someone was born, ranging from age 65 to age 67 for people born in 1960 or later.

If someone delays receiving benefits past their full retirement age, up to age 70, the monthly amount increases. The increase is substantial—roughly 8 percent per year of delay. This delayed retirement credits feature means that someone who waits until age 70 to start benefits could receive significantly more per month than someone who starts at age 62, though they will have received fewer total payments by that point.

Married people and divorced individuals who were married for at least 10 years may be able to receive benefits based on a spouse's or ex-spouse's work record. In some situations, this could result in a higher benefit amount than what they would receive based on their own earnings history. Additionally, children and surviving spouses of deceased workers may receive benefits based on that worker's record.

According to the SSA, approximately 67 million people received Social Security benefits in 2023, with an average monthly retirement benefit of around $1,907 for retired workers. These figures show the significance of Social Security as a source of income for millions of Americans.

Practical Takeaway: Understanding how retirement benefits are calculated and how delaying benefits increases monthly payments can help inform decisions about when to start receiving income from the program.

Social Security Disability Insurance and How It Works

Social Security Disability Insurance, or SSDI, provides monthly income to working-age people who have a medical condition that is expected to prevent them from working for at least 12 months or result in death. This program recognizes that not all income needs in adulthood are related to retirement. People can experience severe health conditions at any point during their working years, and SSDI offers a safety net for those situations.

Like retirement benefits, SSDI is based on a person's work history and the Social Security taxes they have paid. However, the work requirements are typically less stringent than for retirement benefits. A younger worker may need fewer credits to be considered. The SSA uses different credit requirements based on the person's age when the disability begins. Generally, workers need to have earned enough credits in recent years to show they were working when their condition began.

The medical evidence required for SSDI is substantial. The SSA does not base decisions on a person's own statement alone. Instead, the agency reviews medical records, laboratory results, imaging studies, and reports from treating doctors and specialists. The SSA also may request that a person undergo a consultative examination performed by a medical professional selected by the agency. This examination helps gather additional medical information about the condition in question.

The severity standard for SSDI is strict. A person's condition must prevent them from doing any kind of work that exists in significant numbers in the national economy. This does not mean the person must be unable to do their previous job—it means they must be unable to work at any substantial level in any occupation. The SSA publishes guidelines that describe what types of conditions typically meet this standard, but each case is reviewed individually based on all available medical evidence.

Family members of SSDI beneficiaries may also receive benefits. A worker's spouse, children, and in some cases, parents who are dependent on the worker, may be able to receive payments based on that worker's record. This feature helps protect entire families when the worker becomes unable to work due to a severe condition.

As of 2023, approximately 8.6 million people received SSDI benefits, with an average monthly payment of around $1,550 for disabled workers. These payments represent critical income for individuals and families facing significant health challenges.

Practical Takeaway: SSDI is a work-based insurance program that requires substantial medical evidence of an inability to work. Learning what medical documentation the SSA reviews can help people understand what information may be important to gather.

Supplemental Security Income and Needs-Based Support

Supplemental Security Income, or SSI, differs from retirement and disability benefits in an important way: it is based on financial need rather than work history. The SSA administers SSI for people with limited income and resources who are 65 years old or older, blind, or have disabilities. Unlike SSDI, which requires a substantial work history, SSI is available to people who may have never worked or worked very little.

SSI has strict limits on how much money and property a person can have and still receive benefits. In 2024, an individual can have no more than $2,000 in countable resources, while a couple can have no more than $3,000. Resources include bank accounts, savings, investments, and property other than a primary home and one vehicle. The monthly income limit is also set each year and varies by state, but the federal base amount for 2024 is $943 per month for an individual and $1,415 for a couple.

The SSA counts different types of income in different ways when determining SSI benefits. For example, the first $65 of monthly earned income is not counted, and half of earnings above that amount are not counted. Unearned income like interest from savings or gifts from family members is counted more strictly. Understanding these rules is important because they affect how much someone can earn or receive from other sources while still getting SSI payments.

For older adults receiving SSI,