Social Security Benefits

In the Meantime
Money in the Social Security trust funds is invested in government bonds, which helps pay for public works projects around the country.

Social Security is not just about paying retired people a monthly income. The program acts as insurance for Americans who encounter difficult financial situations. This includes (but is not limited to):

  • insurance for retirement
  • insurance for the surviving spouse and children of someone who dies
  • insurance for disability
  • veterans benefits
  • unemployment insurance
  • food stamps and other forms of welfare
This chart shows the distribution of the most common types of Social Security benefits:

Chart of Social Security benefits distribution
Courtesy Social Security Online


The Medicare program is also a part of the Social Security system. To learn about the various situations that qualify for Social Security benefits, see Social Security Online.

Still, Americans in retirement make up the largest segment of Social Security beneficiaries, and for most of them, Social Security benefits comprise a large percentage of their income once they retire.

Chart showing percentage of older Americans' income from Social Security
Courtesy Social Security Online

So let's start by discussing how people receive retirement benefits and how the amount of the benefit is determined.