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Social Security: a social insurance program funded through dedicated payroll taxes called FICA (Federal Insurance Contributions Act). Tax deposits are formally entrusted to Federal Old-Age and Survivors Insurance Trust Fund, or Federal Disability Insurance Trust Fund, Federal Hospital Insurance Trust Fund or the Federal Supplementary Medical Insurance Trust Fund. The main part of the program is sometimes abbreviated (OASDI), in reference to its three beneficiaries (OA for retirement, S for widows and survivors income, D for the disabled, and I for insurance). When initially signed into law by President Franklin D. Roosevelt in 1935, the term Social Security covered unemployment insurance as well. The term, in everyday speech, is used only to refer to the benefits for retirement, disability, survivorship, and death, which are the four main benefits provided by traditional private-sector pension plans. In 2004 the U.S. Social Security system paid out almost $500 billion in benefits. By dollars paid, the U.S. Social Security program is the largest government program in the world.

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Last modified: 12.16.2014