6 Types of People Who Can’t Count on Social Security

Unhappy senior woman
Photo by BaLL LunLa / Shutterstock.com

Not everyone can count on Social Security.

People who didn’t pay into the Social Security system, or didn’t pay enough into it, as well as people in certain other situations may be ineligible for retirement benefits.

Following are several specific types of folks who should not count on receiving benefits.

1. Infrequent workers

To receive Social Security retirement benefits, most people need to accumulate at least 40 “credits” during their working lifetime, according to the U.S. Social Security Administration (SSA).

Currently, you can earn up to four credits per year if you work and pay Social Security taxes.

So, it’s perhaps no surprise that people who didn’t work enough to qualify for benefits — including immigrants who arrived in the U.S. late in life — make up more than 80% of the people who have never received benefits, SSA data shows.

2. Noncovered workers

Not every worker pays into the Social Security system. In certain states, public employees are not covered by Social Security due to receiving a pension.

Such workers can include employees of state and local government agencies, including school systems, colleges and universities. In some states, they may also include police officers and firefighters.

3. Certain debtors

Do you owe the government money? If so, you might have some of your Social Security benefits withheld to help pay the debt.

If you have overdue federal tax debts or federal student loans, the government can garnish your benefits, as we detail in “10 Things That Can Ding Your Social Security Payments.”

On top of that, if you owe child support or alimony, you could see your benefits diminished to cover those obligations.

4. Certain expatriates

If you retire in a foreign country, in most cases you can receive your Social Security benefits there.

However, there are some countries to which the SSA generally can’t send money. Check out the SSA website to find a breakdown of which countries fall into this category.

The SSA does make exceptions in some situations — but not for anyone living in two particular countries.

“The U.S. Department of the Treasury prohibits making payments to persons residing in Cuba or North Korea,” the SSA says.

However, if you are a U.S. citizen living in either of those nations, your Social Security benefits will be held for you and paid out when you move to a country to which the SSA can send payments.

Use the SSA’s Payments Abroad Screening Tool to see if you could receive your benefits as an expatriate.

5. Many prisoners

The Social Security program prohibits payments to most prisoners while they are in jail or prison, according to the SSA. Benefits are suspended for people who have been incarcerated for more than 30 consecutive days due to being convicted of a crime.

6. Self-employed people who don’t report

People who work for employers get help reporting their earnings to the Social Security Administration and paying their Social Security taxes.

Specifically, employers do all the following on behalf of workers:

  • Report workers’ wages to the SSA so that workers receive the Social Security credits they earned.
  • Deduct half — 6.2% — of workers’ Social Security taxes from workers’ paychecks and send the money to the IRS.
  • Match the other half of workers’ Social Security taxes and send the money to the IRS.

However, self-employed people are required to report their own wages and pay the full 12.4% in Social Security taxes to the IRS. This includes submitting an IRS form known as Schedule SE.

The SSA explains:

“If your net earnings are $400 or more in a year, you must report your earnings on Schedule SE, in addition to the other tax forms you must file. … Even if you don’t owe any income tax, you must complete Form 1040 and Schedule SE to pay self-employment Social Security tax. This is true even if you already get Social Security benefits.”

If you’re self-employed but aren’t reporting all your earnings or aren’t paying Social Security taxes, you likely aren’t building up Social Security credits — or aren’t building up as many as you should. Depending on the severity of your situation, you could end up not receiving retirement benefits later.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
8 Products That Make It Easier to Get Fit
8 Products That Make It Easier to Get Fit

Amazon reviewers give high marks to these tools that can help you get in shape without a gym.

This Type of Social Security Benefit Is Often Overlooked
This Type of Social Security Benefit Is Often Overlooked

The Social Security Administration is not helping certain people get money to which they are entitled, a report says.

9 Hidden Ways to Get More Out of Amazon
9 Hidden Ways to Get More Out of Amazon

You don’t have to be a Prime member to take advantage of these little-known perks of shopping on Amazon.

7 Social Security Blunders That Can Ruin Your Retirement
7 Social Security Blunders That Can Ruin Your Retirement

Making even one of these mistakes can easily cost you tens of thousands of dollars.

17 Home Maintenance Tasks That Save You Money
17 Home Maintenance Tasks That Save You Money

Here’s how to cut household costs and maintain your property’s value.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
7 Kirkland Signature Items to Avoid at Costco
7 Kirkland Signature Items to Avoid at Costco

Even if it seems you save a bundle buying Costco’s Kirkland Signature brand products, they may not be the bargain they appear to be.

How to Buy Gas At Costco Without a Membership
How to Buy Gas At Costco Without a Membership

The warehouse club often has some of the cheapest gas in town. Here’s how you can get it as a nonmember.

10 Things to Stop Buying If You Want a Clutter-Free Home
10 Things to Stop Buying If You Want a Clutter-Free Home

If you like to keep things simple, avoid these purchases.

If You Find This Thrift Shopping, Buy It
If You Find This Thrift Shopping, Buy It

Vacuums from this brand can last a half-century, if not longer — and they’re hot on the resale market.

A Simple Way to Silence Robocalls Today
A Simple Way to Silence Robocalls Today

A few steps can keep your phone from ringing when a spammer calls.

This Company Makes the Best Tires in America
This Company Makes the Best Tires in America

Driver satisfaction with tires is at an all-time high, but one brand stands out.

Can I Switch to Spousal Social Security Benefits When My Ex Dies?
Can I Switch to Spousal Social Security Benefits When My Ex Dies?

Knowing when to claim can help you maximize benefits.

36 Things That Will Be Obsolete Soon
36 Things That Will Be Obsolete Soon

The writing is on the wall for dozens of things we have grown up with.

17 Surprising Things You Can Sell for Extra Money
17 Surprising Things You Can Sell for Extra Money

You probably don’t realize these items are worth decent cash.

8 Things You Should Always Buy on Amazon
8 Things You Should Always Buy on Amazon

The giant retailer shines when it comes to these things, from basics to hard-to-find specialty goods.

This Health Issue Can Hint at Dementia Years in Advance
This Health Issue Can Hint at Dementia Years in Advance

One type of pain is especially associated with cognitive decline.

8 Federal Income Tax Breaks for Homeowners
8 Federal Income Tax Breaks for Homeowners

Some of these deductions and credits are available to a wide swath of homeowners.

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

5 Ways to Get Amazon Prime for Free
5 Ways to Get Amazon Prime for Free

Hesitant to drop $119 a year on an Amazon Prime membership? Here’s how to get it for free.

5 Ways to Fill Your Pantry With Free Food
5 Ways to Fill Your Pantry With Free Food

Anyone can take advantage of these resources.

9 Things You’ll Never See at Costco Again
9 Things You’ll Never See at Costco Again

The warehouse store offers an enormous selection, but these products aren’t coming back.

10 Types of Retirement Income That Are Not Taxable
10 Types of Retirement Income That Are Not Taxable

There are lots of things Uncle Sam can’t touch — so long as you play by the rules.

6 Reasons You Should Stop Hiding Cash at Home
6 Reasons You Should Stop Hiding Cash at Home

Stashing money around the house is anything but harmless.

These 5 States Are the Most Expensive Places to Retire
These 5 States Are the Most Expensive Places to Retire

If you expect to have modest retirement income, you may want to avoid spending your golden years here.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.