Is Social Security for everyone? The simple answer is no.
However, it is rare to find American workers who do not meet the requirements for Social Security benefits.
It is crucial to know whether you fall under this category so you can find alternative income sources or establish whether there is anything you can do to qualify.
This post will list types of workers who are commonly ineligible for Social Security. But first, we will briefly discuss who qualifies for Social Security and the eligibility criteria.
Social Security Eligibility
There are three main circumstances under which you can be eligible for Social Security:
Based on your job
You qualify if:
- You worked and paid into the Social Security system for at least ten years
- You are not less than 62 years old
The Social Security Administration (SSA) tracks how long you have paid taxes into the Social Security system. You can check your account on the SSA website to know whether you qualify for benefits.
Based on your current or ex-spouse’s work
If you have worked for at least ten years and paid into the Social Security system, you will collect monthly payments in line with that job.
The SSA will then determine if you qualify for more payments in line with your current or ex-spouse occupation.
It will still check to determine if you qualify for monthly payments based on your current or ex-spouse’s work, even if you have not worked or contributed Social Security taxes for at least ten years.
The criteria vary depending on whether you are divorced, married, or widowed. The SSA will ensure you receive the maximum monthly payment you are entitled to when you file and provide information about your present and previous marriages.
Eligibility for children
Your kids may qualify for monthly benefits based on your job if they:
- Are under 18 years old
- Are under 19 and still in school
- Have a disability.
Is Social Security for Everyone?
So, is social security for everyone? The answer is no. Here are the types of people not qualifying for Social Security retirement benefits.
1. Workers with fewer work credits
Can someone who has never worked get Social Security benefits? No. Working for a sufficient period is the minimum requirement for collecting Social Security benefits.
According to the SSA, earning 40 work credits counts as enough work. A person can earn up to four work credits per year; as of 2022, one work credit is worth $1,640.
It takes up to ten years to earn the forty work credits. If you make the $7.25 minimum wage per hour, you must put in 226.21 hours of labor to qualify for one Social Security credit.
You could achieve the maximum number of credits every year if you work 17.5 hours only per week for 50 weeks at this salary, leaving you with a two-week break.
Even part-time workers who support their families, go to school, or because they are unable to find regular employment can easily accrue work credits.
Earned credits never expire, and they accumulate during an individual’s lifetime. If someone quits employment with over 40 credits, they could still return and perform the extra work required to qualify.
2. Workers who pass on before attaining 62 years
A person must be 62 and older to start collecting Social Security benefits. If someone passes away prematurely, spouses and dependent children may be eligible for survivor benefits.
Widows and widowers, for instance, can start collecting Social Security payments based on their late spouse’s wage history at age 60 (or 50 for those with disabilities).
Individuals with a terminal illness are eligible for Social Security Disability Insurance (SSDI), meaning they will continue to benefit in some way from their Social Security taxes.
What if you meet the full retirement age (FRA) while having a terminal illness? If you are unmarried, consider applying for benefits immediately. But if you are married, delaying may benefit your spouse more.
The spousal benefit can be up to 50% of the worker’s Social Security, based on the age at which they retire and whether you qualify for retirement benefits based on your earnings history.
3. Some divorced spouses
Social Security benefits for divorcees may depend on the ex-spouse’s earnings record. Usually, these parents stayed home to raise their children or homemakers.
You must be unmarried, at least 62, and have collected fewer payouts based on your employment history than your ex-spouse to be eligible.
You would be ineligible for spousal benefits if divorced in the first ten years of marriage.
4. Workers who retire in specific overseas countries
Social Security payments are often available to Americans who resign, travel, or relocate to foreign nations.
But if f that nation is Cuba, Belarus, Azerbaijan, Kyrgyzstan, Kazakhstan, North Korea, North Korea, Moldova, Uzbekistan, Tajikistan, or Turkmenistan, you will not qualify for Social Security benefits.
Aside from Cuba and North Korea, there could be exceptions for any of these nations. You can easily check whether you can continue collecting Social Security payments while living overseas using the government’s Payments Abroad Screening Tool.
5. Some noncitizens
Some noncitizens who have worked and accrued the required 40 work credits in the US qualify for Supplemental Security Income (SSI).
An immigrant without the required work credits but from any of the 30 nations with which the US has Social Security pacts, called totalization agreements, may be eligible for prorated benefits.
Prorated benefits depend on the worker’s cumulative foreign and domestic labor credits. This plan is especially useful to elderly immigrants who are unlikely to complete ten years of employment in the US before retiring.
But those yet to accrue at least six work credits in the US do not qualify for payouts under totalization agreements.
6. Certain federal and railroad workers
Some occupations do not contribute to Social Security. Until 1984, federal employees were covered by the Civil Service Retirement System (CSRS), which offers disability, retirement, and survivor benefits.
Since no Social Security taxes were taken from these employees’ paychecks, they do not qualify for benefits under the Social Security system.
These workers might be eligible if they earned benefits through a spouse or alternative job. CSRS pension benefits, however, might lower Social Security benefits in this case.
Social Security benefits are available to federal workers covered by FERS (Federal Employees Retirement System), which took over the role of CSRS.
Social Security covers many state and municipal employees under a federal Section 218 agreement.
Yet, some workers- like those working for public schools, colleges, or universities may only qualify for benefits if they paid Social Security taxes.
Railroad employees
Social Security does not provide benefits to all railroad workers. The Railroad Retirement Board (RRB) provides retirement benefits for employees with ten or more years of railroad-related experience (or five years after 1995).
The RRB is a free-standing federal organization that manages many benefits for workers in the railroad sector.
Individuals without at least ten years of railroad-related service (or less than five years after 1995) are not eligible for RRB retirement benefits. Rather, their money goes to Social Security, where they can receive benefits once they meet the requirements.
7. Self-employed workers who evade tax
Self-employed workers contribute self-employment tax to cover their and the employer’s Social Security contributions. The tax is estimated and deducted annually when self-employed persons file their tax returns.
Instead of workers whose employers deduct and remit taxes from every paycheck, individuals who do not file federal tax returns never pay Social Security taxes.
You will not collect any benefits if you have no track of contributing to the Social Security system. You do not qualify for Social Security payments if you never paid taxes or declared your income.
8. Some immigrants over 65 years
Retirees must have 40 US Social Security work credits to be eligible for benefits. Most retired immigrants do not meet this requirement.
One solution to this issue is to accrue six credits and, in line with a totalization agreement, collect prorated benefits from the US and their former nation.
For workers who receive limited benefits from their native nation to be eligible for Social Security benefits, this option makes sense.
Elderly immigrants who are ineligible for American Social Security but whose home countries’ laws permit them to claim benefits while living overseas may apply for Social Security or pensioner benefits while residing in the US.
The Bottom Line
Most retired workers in the US collect Social Security retirement benefits – as long as they have attained full retirement age.
But is social security for everyone? No.
Individuals who are yet to work and earn the required work credits, either because they are full-time homemakers or working overseas, may be ineligible based on their work.
Some of them may collect spousal benefits if their spouses are eligible. Some federal workers also do not qualify.
Fortunately, some of them can still find a way to qualify. A Social Security lawyer can help you determine what to do to meet the eligibility criteria.
At Legal Giant, we partner with experienced Social Security lawyers who can help with this and also help you file a successful application for Social Security benefits.
Contact us at 833-641-1650 to schedule a free consultation.
