A secure, comfortable retirement is every worker's dream. Nowadays workers are living longer, healthier lives. Your employees can expect to spend more time in retirement than their parents and grandparents. It is important that their earnings are posted correctly on their Social Security record, as it will affect their benefits when they retire.
By law, employers must withhold Social Security taxes from a worker’s paycheck. While usually referred to on an employee’s pay statement as “Social Security taxes,” sometimes the deduction is labeled as “FICA,” which stands for Federal Insurance Contributions Act, a reference to the original Social Security Act. In some cases, you will see “OASDI,” which stands for Old Age Survivors Disability Insurance. The Social Security taxes your employees pay now can provide valuable disability or survivors benefits in the event the unexpected happens.
Social Security taxes also translate to a lifetime of protection — for retirement in old age or in the event of disability. And when you die, your family (or future family) may be able to receive survivors benefits based on your work.
A personal my Social Security account offers your employees an opportunity to plan and have more control of their financial future. One of the advantages of opening a my Social Security account is having access to your Social Security Statement instantly. With their Statement, your employees can review estimates of their future retirement, disability, and survivors benefits, as well as the Social Security and Medicare taxes they’ve paid. We base future benefits on the recorded earnings, so everyone should access their Statement once a year to verify that the amounts posted are correct. Employees should also check it whenever there is a change of employment or they wish to verify any changes to their benefit estimate.
Here are five additional resources to help your employees learn more about their earnings, FICA taxes, and their personal my Social Security account:
- With our online booklet, How You Earn Credits, your employees can learn a little more about Social Security and exactly what they’re building up for themselves by paying Social Security taxes.
- Our webinar, "Social Security 101: What's in it for me?" explains what your employees need to know about Social Security.
- They can also learn more about opening a personal my Social Security and all the things they can do online with one.
- Our online financial planners teach your employees to plan for retirement and the unexpected.
- Visit our website www.socialsecurity.gov to learn more about Social Security’s commitment to securing today and tomorrow for your employees and their loved ones.