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At Iowa Retirement Benefits & Solutions, we frequently receive questions about Social Security—how it works, why it was created, and how it fits into your retirement strategy. Many Americans don't fully understand the system, yet it plays a crucial role in retirement planning.
This guide will provide a quick overview of Social Security. Stay tuned for a follow-up on why professional guidance is essential in choosing the best time to start receiving your benefits.
Understanding Social Security
Social Security is a federal program that provides financial support to:
Retirees
Individuals with Disabilities
Survivors of Deceased Workers
It's funded through payroll taxes paid by both employees and employers under the Federal Insurance Contributions Act (FICA).
Key Social Security Benefits
Retirement Benefits
Monthly income for eligible workers, typically starting at age 62 or later.
Disability Benefits (SSDI)
Financial support for individuals unable to work due to a qualifying disability.
Survivors Benefits
Assistance for spouses, children, or dependents of a deceased worker.
Supplemental Security Income (SSI)
Needs-based financial aid for low-income seniors or disabled individuals.
The Origins of Social Security
Social Security was created under President Franklin D. Roosevelt's New Deal during the Great Depression to help aging Americans regain financial security.
- Signed into law: August 14, 1935
- Purpose: To provide economic relief to retirees who lost savings or employment
- Expansion: Initially, it covered only certain workers but later grew to include disability and survivors' benefits
The first Social Security check was issued in 1940 to Ida May Fuller, who contributed for just a few years but received far more in benefits than she paid in—an early indicator of the program's long-term funding challenges.
Why Social Security Matters
- Lifeline for Retirees – For many Americans, Social Security is their primary source of income. Click for more options.
- Reduces Poverty – Helps protect the elderly and disabled from financial hardship.
- Economic Stability – Supports millions of households, keeping the economy strong.
However, Social Security faces financial challenges due to an aging population and fewer workers paying into the system. Without reform, the trust fund could be depleted by the 2030s, potentially leading to reduced benefits.
Plan Ahead for Social Security
Your Social Security strategy can impact your retirement income significantly. If you're unsure about when to claim benefits or how it fits into your overall plan, our team at Iowa Retirement Benefits & Solutions is here to help!
Not sure when to start claiming? Our guide on Taking the Guesswork Out of Social Security Planning breaks down how age, marital status, and other income sources shape the right timing for you.
Ready to Build Your Social Security Strategy?
Claiming decisions are permanent — let's make sure yours is the right one for your income, your health, and your household.
Schedule a Free Retirement Review →Investment advisory services are offered through Fusion Capital Management, an SEC registered investment advisor. The firm only transacts business in states where it is properly registered or is excluded or exempted from registration requirements. SEC registration is not an endorsement of the firm by the commission and does not mean that the advisor has attained a specific level of skill or ability. All investment strategies have the potential for profit or loss.
