The Social Security Administration — commonly called the SSA — is a federal government agency responsible for administering several major benefit programs that provide financial support to millions of Americans. Founded in 1935 as part of President Franklin D. Roosevelt’s New Deal the Social Security Administration has grown into one of the largest and most important agencies in the federal government.
Understanding what the Social Security Administration does, what programs it manages, and how to interact with it effectively can help individuals and families access the benefits they are entitled to.
What the Social Security Administration does
The Social Security Administration is responsible for administering three major federal benefit programs:
- Social Security retirement benefits — monthly payments to eligible workers who have reached retirement age and their dependents based on the worker’s lifetime earnings record
- Social Security disability benefits — SSDI — monthly payments to eligible workers who have a disabling medical condition that prevents them from working and their dependents
- Supplemental Security Income — SSI — needs-based monthly payments to low income individuals who are aged 65 or older, blind, or disabled regardless of work history
In addition to administering these programs the SSA:
- Maintains earnings records for all workers who pay Social Security taxes
- Issues Social Security numbers to U.S. citizens and eligible non-citizens
- Processes applications for Medicare enrollment for people approaching age 65
- Provides benefit verification letters and other documentation
- Manages the appeals process for denied benefit claims
Social Security retirement benefits
Social Security retirement benefits are the most widely known program administered by the SSA. Workers become eligible for retirement benefits based on their work history — specifically the number of credits they have earned by paying Social Security taxes over their working lives.
Most workers need 40 credits — equivalent to approximately 10 years of work — to be eligible for retirement benefits. The benefit amount is based on the worker’s average indexed monthly earnings over their 35 highest earning years.
Workers can begin claiming retirement benefits as early as age 62 with a permanent reduction in benefits or wait until age 70 to receive the maximum benefit. Full retirement age — the age at which a worker receives their full benefit — is currently 67 for people born in 1960 or later.
Social Security Disability Insurance — SSDI
Social Security Disability Insurance provides monthly benefits to workers who become disabled before reaching retirement age and are unable to work due to a serious medical condition expected to last at least one year or result in death.
To qualify for SSDI a worker must have earned enough Social Security credits based on their age at the time of disability and must meet the SSA’s definition of disability which requires that the condition prevent substantial gainful activity.
The SSDI application process can be lengthy and complex and initial applications are frequently denied. Many applicants work with a disability attorney or advocate to navigate the process and handle appeals.
Supplemental Security Income — SSI
Supplemental Security Income is a needs-based program that provides monthly payments to low income individuals who are aged 65 or older, blind, or disabled. Unlike Social Security retirement and disability benefits SSI eligibility is not based on work history — it is based on financial need.
SSI has strict income and asset limits. As of recent years the federal benefit rate for SSI is approximately $943 per month for an individual and $1,415 per month for a couple though many states supplement the federal benefit with additional state payments.
SSI recipients are typically also eligible for Medicaid which provides health coverage for low income individuals.
How to apply for Social Security benefits
Applications for Social Security benefits can be submitted in several ways:
- Online — at ssa.gov where you can apply for retirement, disability, and Medicare benefits
- By phone — by calling the SSA at 1-800-772-1213
- In person — at your local Social Security office. You can find your nearest office at ssa.gov.
It is generally recommended to apply for retirement benefits about three months before you want them to begin. For disability benefits it is important to apply as soon as possible after becoming disabled because benefits are generally not paid retroactively beyond a certain point.
My Social Security online account
The SSA offers a free online account called my Social Security at ssa.gov that allows individuals to:
- View their earnings record and check it for accuracy
- Get estimates of their future retirement, disability, and survivor benefits
- Manage their existing benefits if they are already receiving Social Security
- Request a replacement Social Security card
- Get a benefit verification letter
- Set up or change direct deposit for benefit payments
Creating a my Social Security account is highly recommended for all adults as it allows you to monitor your earnings record and plan for retirement.
Social Security and Medicare
The Social Security Administration plays an important role in Medicare enrollment. Most people are automatically enrolled in Medicare Part A and Part B when they turn 65 if they are already receiving Social Security benefits. People who are not yet receiving Social Security must actively enroll in Medicare during their initial enrollment period.
Applications for Medicare can be submitted through the SSA online, by phone, or in person at a local Social Security office.
Appealing a Social Security decision
If the SSA denies your application for benefits or makes a decision you disagree with you have the right to appeal. The Social Security appeals process has four levels:
- Reconsideration — a complete review of your claim by someone who was not involved in the original decision
- Hearing before an administrative law judge — a hearing at which you can present evidence and testimony before an ALJ
- Review by the Appeals Council — a review of the ALJ’s decision by the SSA’s Appeals Council
- Federal court review — if all administrative appeals are exhausted you can file a lawsuit in federal district court
Many applicants especially those applying for disability benefits choose to work with a Social Security attorney or advocate who can help navigate the appeals process. Social Security attorneys typically work on a contingency basis meaning they only charge a fee if your claim is approved.
Protecting your Social Security number
Your Social Security number is one of the most sensitive pieces of personal information you have. Identity thieves can use your Social Security number to open fraudulent accounts, file false tax returns, and claim Social Security benefits in your name. Protect your Social Security number by:
- Never carrying your Social Security card in your wallet
- Being cautious about sharing your Social Security number — only provide it when absolutely necessary
- Monitoring your earnings record through your my Social Security account for unauthorized activity
- Placing a credit freeze with the major credit bureaus if you suspect your Social Security number has been compromised
Key terms to know
- Social Security Administration — SSA — the federal agency that administers Social Security retirement, disability, and SSI programs
- Social Security retirement benefits — monthly payments to eligible workers based on their earnings record
- Social Security Disability Insurance — SSDI — monthly payments to disabled workers who cannot work
- Supplemental Security Income — SSI — needs-based monthly payments to low income aged blind or disabled individuals
- Full retirement age — the age at which a worker receives their full Social Security retirement benefit
- My Social Security — the SSA’s free online account management portal at ssa.gov
- Administrative law judge — ALJ — a judge who presides over Social Security appeals hearings
- Credits — units earned by working and paying Social Security taxes used to determine eligibility for benefits
Sources
- Social Security Administration — ssa.gov
- Medicare.gov
- USA.gov — Social Security
This article is for general informational purposes only and does not constitute legal or financial advice. Social Security rules and benefit amounts are subject to change. Visit ssa.gov or contact the Social Security Administration directly for the most current information specific to your situation.