Why Young Workers Should Care About Social Security

Summer will be here before we know it. That means millions of high school and college students will be searching for jobs. Whether a new worker is beginning the career of a lifetime or just earning some extra money for the school year to come, there is one question that is likely to be on each new worker’s mind when they see their first pay stub: Where’s the rest of my money?

Generally, employers are required to withhold Social Security and Medicare tax from a worker’s paycheck. The amounts you pay in Social Security and Medicare taxes are matched by your employer. Usually the money that is withheld is referred to as “Social Security taxes” on the employee’s payroll statement. Sometimes the deduction is labeled as “FICA taxes,” which stands for Federal Insurance Contributions Act. So let us tell you how that money is being used, and what’s in it for you.

The taxes paid now translate to a lifetime of protection, when you eventually retire or if you become disabled. In the event that you die young, your dependent children and spouse may be able to receive survivors benefits based on your work. Today you probably have family members — grandparents, for example — who already enjoy Social Security benefits that your Social Security taxes help provide.

You may be a long way from retirement now, so you may find it hard to appreciate the value of benefits that could be 40 or 50 years away. But consider that your Social Security taxes could pay off sooner than you think. Social Security provides valuable disability benefits — and studies show that a 20-year-old has about a three in 10 chance of becoming disabled sometime before reaching retirement age.

Another bit of helpful advice for young workers: be wary if you’re offered a job “under the table” or “off the books.” If you work for any employer who pays you only in cash, understand that you’re likely not getting Social Security credit for the work you’re doing.

Want to learn more about Social Security and what it means to young workers? If so, we invite you to enjoy a webcast: Social Security 101: What’s In It For Me? The webcast will fill you in on the details you should know to get the most out of Social Security. Check it out at www.socialsecurity.gov/webinars/social_security_101.html.

If you have questions about Social Security, the best place to go is online — to www.socialsecurity.gov.