Social Security
RetirementGlossary term
Definition
A federal program providing retirement, disability, and survivor benefits funded through payroll taxes. Retirement benefits are based on your 35 highest-earning years and the age at which you begin collecting. Full retirement age ranges from 66 to 67.
Related terms
- Payroll TaxTaxes withheld from employee paychecks and paid by employers to fund Social Security and Medicare. Employees and employers each pay 7.65% of wages, split between Social Security (6.2%) and Medicare (1.45%).
- Retirement IncomeMoney received during retirement from various sources including Social Security, pensions, retirement account withdrawals, annuities, and investment income. Planning for multiple income streams helps ensure financial security throughout retirement.
- PensionA retirement plan funded by an employer that provides regular payments to employees after retirement. Increasingly rare in private sector, more common in government jobs.
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