SOCIAL SECURITY: BASIC FACTS (2 OF 2)
01.Core Concepts
• An estimated 182 million workers are covered under Social Security. • 31% of the workforce has no private pension coverage • 63% of workers are saving for retirement • In 1940, the life expectancy of a 65-year-old was almost 14 years; today it is just over 20 years. • By 2035, the number of Americans age 65 and older will increase from 58 million today to 75 million. • There are currently 2.8 workers for each Social Security beneficiary. By 2035, there will be 2.3 workers for each beneficiary. 7 SOCIAL SECURITY FUNDING: TAXES & CONTRIBUTIONS Federal Insurance Contributions Act (FICA) • Collected through payroll taxes • Total taxes of 7.65% paid by employee & matched by employer • 6.2% up to $176,100 (2025) of compensation (OASDI) • 1.45% of total compensation (HI) • Additional Medicare Tax of 0.9% on wages, compensation or self- employment income in excess of $250,000 MFJ or $200,000 single. OASI Trust Fund 5.30% up to $176,100 (2025) DI Trust 0.9% up to $176,100 (2025) HI Trust 1.45% (all compensation) SMI Trust Funded by general tax revenue