You’ve seen the deductions on your paycheck. FICA. It’s just a line item until you start getting closer to 65, and then suddenly, those four letters become the most important acronym in your life. But honestly, most people have no idea how this whole thing got off the ground.
They think it just appeared. Or that it was always meant to be this massive safety net for everyone.
The truth is way messier.
When was social security started? Officially, it was August 14, 1935. President Franklin D. Roosevelt sat down in the White House Cabinet Room at 3:30 p.m. and signed the Social Security Act into law. But if you think that was the end of the story, you're missing the best parts. The program didn't actually start "working" for years.
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The Chaos Before the Check
In 1935, America was a wreck. We were in the middle of the Great Depression, and if you were old and out of work, you were basically out of luck. FDR wanted a "cradle to grave" system, but the version that actually passed was a lot thinner than what he dreamed up.
It wasn't even called Social Security at first.
Originally, the bill was titled the Economic Security Act. It was renamed during the Congressional debates because "Social Security" just sounded better to the people voting on it.
Here is the weird thing: even after it was signed in '35, nobody got a monthly check. Not for a long time.
Why the delay?
The government had to build a literal empire from scratch. Imagine trying to track the earnings of millions of workers without a single computer. They didn't even have a building in Washington D.C. big enough to hold all the filing cabinets.
They ended up moving the headquarters to a former Coca-Cola bottling plant in Baltimore.
- 1935: Law signed.
- 1936: The Social Security Board starts assigning numbers (SSNs).
- 1937: Payroll taxes are collected for the first time (a whopping 1%).
- 1940: The first monthly retirement check finally goes out.
Ida May Fuller and the First $22.54
We have to talk about Ida May Fuller. She is a legend in the Social Security world. Ida was a legal secretary from Ludlow, Vermont, who retired in 1939. Because of how the timing worked out, she had only paid into the system for about three years.
Her total contribution? $24.75.
Her first check, which arrived in January 1940, was for $22.54.
She lived to be 100 years old. By the time she passed away in 1975, she had collected over $22,000 in benefits. That’s the kind of ROI that modern investors would kill for. But Ida’s story also highlights why people get so stressed about the program today—it was designed as a "pay-as-you-go" system, where current workers pay for current retirees.
In the beginning, that was easy. There were tons of workers and very few retirees.
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It Wasn't Always for Everyone
When was social security started, it was actually pretty exclusive. If you were a farm worker or a domestic servant (like a maid or a cook), you were left out. This meant about half of the jobs in the U.S. economy weren't covered.
It wasn't until the 1950s that the program expanded to cover the self-employed and farm workers.
And disability? That wasn't even part of the original deal. Disability insurance (SSDI) didn't show up until 1956. Before that, if you got hurt and couldn't work, Social Security had nothing for you.
The Evolution of the Tax
Back in 1937, the tax was 1% for the employee and 1% for the employer.
That’s it.
And it only applied to the first $3,000 you earned.
Fast forward to 2026, and the landscape is unrecognizable. The combined rate is 12.4% (split between you and your boss), and the taxable maximum has climbed to $184,500. If you make more than that, you stop paying into the Social Security portion of FICA for the rest of the year.
Myths That Just Won't Die
I hear this all the time: "The government is raiding the trust fund."
It’s a great soundbite. It's also kinda wrong.
By law, any surplus Social Security tax must be invested in interest-bearing U.S. Treasury securities. So, the money isn't "gone"—it’s sitting in government bonds. The issue isn't that the money was "stolen"; it's that as the "Baby Boomers" retire, the system is spending more than it takes in.
Another big one? "I'll never get a dime because it's going bankrupt."
Even if the "Trust Fund" hits zero (which experts currently project around 2033 or 2034), the system still collects taxes from people who are working. Those taxes would still cover about 75% to 80% of scheduled benefits. It’s not a total collapse, but a 20% pay cut is definitely not what most people have in their retirement plans.
Key Milestones You Should Know
- 1935: The Act is signed.
- 1939: Survivors and dependents benefits are added (huge shift from individual to family protection).
- 1965: Medicare is added to the Social Security Act.
- 1972: Automatic Cost-of-Living Adjustments (COLA) are enacted. Before this, Congress had to vote on every single increase.
- 1983: The last "big" overhaul. This is when they started taxing benefits and gradually raised the retirement age from 65 to 67.
Moving Toward Your Own Retirement
Knowing when was social security started is cool for trivia, but it's more important for your wallet. If you're looking at your own future, don't just guess.
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First, create a "my Social Security" account on the official SSA.gov website. It’s the only way to see your actual earnings history. If a job you worked in 1998 is missing, your future check will be smaller.
Second, understand the "Full Retirement Age" (FRA). For anyone born in 1960 or later, it’s 67. If you take your money at 62, you’re looking at a permanent 30% cut. If you wait until 70, you get a massive bonus—about 8% more for every year you delay past your FRA.
Third, remember the "three-legged stool." Social Security was never meant to be 100% of your income. It usually covers about 40% of a career-average earner's income. You need the other two legs: personal savings (like a 401k or IRA) and, if you're lucky, a private pension.
Your Next Action Steps
- Check your statement: Log in to SSA.gov and verify your reported income for the last few years.
- Calculate your "Gap": Estimate your monthly expenses in retirement and subtract your projected Social Security benefit to see how much you need to save independently.
- Review your filing strategy: If you are married, look into how "spousal benefits" work, as this can significantly change when you and your partner choose to claim.