Which government program provides periodic retirement income based on your work history?

• A. Pension
• B. 401(k)
• C. Roth IRA
• D. Social Security

Answer: (D)

Social Security is a government program that provides regular monthly retirement income based on your work history. It’s funded by payroll taxes you pay during your career, and the benefit you receive in retirement depends on the earnings you reported and the length of time you paid into the system. This distinguishes it from other options: a pension is typically an employer-sponsored retirement plan, a 401(k) is a private savings plan funded by you (and sometimes matched by an employer), and a Roth IRA is an individual retirement account funded with after-tax dollars. Because it’s a government program designed to provide ongoing retirement income tied to your work history, Social Security fits this description.