A fuller guide to this term is on the way. In the meantime, the related terms below explain the ideas around it.
Related MoneyPedia terms
- Social SecurityA federal program that pays monthly income to retirees, funded by payroll taxes collected during your working years.
- FICAThe payroll tax that funds Social Security and Medicare, split between you and your employer on your wages.
- Full Retirement AgeThe age at which you can collect your complete Social Security benefit without any reduction for claiming early.
- Spousal BenefitA Social Security payment based on your spouse's earnings record, which can be larger than a benefit based on your own.
- Self-Employment TaxThe Social Security and Medicare tax that self-employed people pay to cover both the employee and employer shares.
- Cost-of-Living Adjustment (COLA)A yearly increase to benefits like Social Security or pensions that helps your income keep pace with inflation.
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Plain-English education — not personalized legal, tax, or investment advice.