One of the most familiar aspects of the Social Security system is its provision of retirement benefits, which play an important role in supporting many people during their old age. These benefits are sometimes known as a Social Security Pension. The benefits provided by the Social Security system have helped to keep many older people out of poverty, and by enabling people to retire rather than continue working, they have also helped to ensure that positions are opened up for younger workers.

Although the retirement benefits provided by the Social Security program share some similarities with pension plans, Social Security operates very differently from a pension. With a pension, the individual provides for their own retirement by investing in their pension, or by taking advantage of the investments made by their employer. When the participant retires, they will receive a pension, the size of which is dependent upon the contributions that they have made and invested. In the Social Security system, workers and employers are taxed in order to provide funds for a number of Social Security programs, including retirement benefits. The taxes paid by the current generation of workers provide the benefits that will support the older generation of retirees. The amount that an individual will receive in retirement benefits will depend upon how much they have earned and how long they have worked, but each generation supports the older generation, and will then be supported by the younger one, rather than making direct use of their own contributions. The taxes that are collected will also fund the other elements of the Social Security system. About 96 percent of workers in America are covered by the Social Security system.

Some people will obtain income from both a pension and from Social Security during their retirement, with different people relying to different extents on Social Security and other sources of income. Few people depend entirely on the benefits they receive from the Social Security system.

When you are planning for your retirement, it is important to understand how the Social Security system works and how much you will be eligible to receive in benefits. If you are currently employed, you will receive a yearly Social Security statement that will tell you how much you would receive in retirement benefits if you were to retire at a certain age. The earliest age at which you can begin receiving retirement benefits is 62. The age at which you can begin receiving full retirement benefits depend on when you were born. It ranges between 66 and 67.

The main factors that will determine how much you will receive in retirement benefits every month will be the age at which you retire and begin receiving benefits, your earnings and the number of years that you have spent in employment. The more that you have contributed as tax to the Social Security system over the course of your working life, the more you will be eligible to receive in benefits. Any other sources of income that you will have during retirement and the ages of your spouse or any children who are still your dependents will also be considered.

When you are ready to retire, you will need to apply for your retirement benefits from the Social Security system. You should make your application at least four months before you need your benefit payments to start, in order to ensure that you will start receiving payments on time. Together with the relevant application forms, you will need to provide certain documentary evidence. You can apply at any Social Security office.