Social Security is a federal program in the United States designed to provide a financial safety net for workers and their families. Established in 1935 as part of the New Deal, it is primarily funded through payroll taxes under the Federal Insurance Contributions Act (FICA) or the Self-Employment Contributions Act (SECA). For the 2026 tax year, employees and employers each pay 6.2 percent on earnings up to $184,500, while the self-employed pay the full 12.4 percent.

Core Benefit Categories

The program is officially known as Old-Age, Survivors, and Disability Insurance (OASDI) and provides three main types of benefits:

  • Retirement Benefits: Monthly payments to workers who have reached age 62 and earned at least 40 “work credits” (roughly 10 years of work). In 2026, one credit is earned for every $1,890 in income.
  • Disability Benefits (SSDI): Support for workers who have a medical condition that prevents them from working for at least a year or is expected to result in death.
  • Survivors Benefits: Payments to the spouses, children, and sometimes parents of a deceased worker who was eligible for Social Security.

2026 Cost-of-Living Adjustment (COLA)

To ensure that benefits keep pace with inflation, the Social Security Administration (SSA) applies an annual Cost-of-Living Adjustment. For January 2026, beneficiaries received a 2.8 percent increase.

  • The average monthly benefit for a retired worker rose to approximately $2,071.
  • The maximum monthly benefit for someone retiring at Full Retirement Age (FRA) in 2026 is $4,152.

Working While Receiving Benefits

You can work and receive Social Security at the same time, but if you are younger than your Full Retirement Age (66 or 67, depending on birth year), an “earnings test” applies.

  • In 2026, if you are under FRA for the entire year, the IRS deducts $1 in benefits for every $2 you earn above $24,480.
  • In the year you reach FRA, the deduction is $1 for every $3 earned over $65,160, but only until the month you reach that age. Once you reach Full Retirement Age, there is no limit on your earnings.

Supplemental Security Income (SSI)

While often confused with Social Security, SSI is a separate program administered by the SSA. It is funded by general tax revenues—not Social Security taxes—and provides monthly payments to adults and children with a disability or blindness, and adults age 65 and older, who have limited income and resources. For 2026, the maximum federal SSI payment is $994 for an individual and $1,491 for a couple.

Source: Social Security Administration (SSA), 2026 COLA Fact Sheet; and AARP, “6 Big Social Security Changes for 2026.”