Final answer:
Social Security retirement benefits are based on the worker's lifetime earnings, particularly the 35 highest-earning years adjusted for inflation. Retirement age has increased from 65 to 67 for those born after 1959. Social Security also provides disability payouts and Supplemental Security Income.
Step-by-step explanation:
The worker's Social Security retirement benefits at full retirement age are primarily based on the worker's lifetime earnings. Workers pay a percentage of their income into the Social Security system through payroll taxes, which in turn funds the benefits that retirees receive. The full retirement age has been gradually increasing; originally set to 65, it rose to 66 and will reach 67 for those born after 1959. The actual benefit received is calculated using a formula that takes into account the worker's 35 highest-earning years, adjusting those earnings for inflation. Social Security is often regarded as an entitlement program, guaranteeing benefits to qualifying Americans. In addition to retirement benefits, Social Security also offers disability payouts and Supplemental Security Income for eligible individuals.