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Planning for retirement in the United States means understanding three distinct gears that work together: the federal Social Security system, private retirement plans such as 401(k) and IRA, and the bilateral totalization agreement between Brazil and the United States, which allows contribution periods in both countries to be combined. For Brazilians who immigrate, ignoring any one of these pillars can mean decades of contributions lost or benefits far below expectations.
This guide explains how Social Security works in 2026, who qualifies, how the Brazil-U.S. totalization treaty has operated since 2018, the updated contribution limits for private plans, and how to build a retirement strategy that integrates both systems. Rules change through annual cost-of-living adjustments and require periodic review.
How Social Security Works
Social Security is administered by the Social Security Administration (SSA) and funded through the FICA tax, which withholds 6.2% of the employee’s wages and another 6.2% from the employer for the retirement component, applied to earnings up to the annual wage base of $176,100 in 2025. Self-employed workers pay both portions through SECA, totaling 12.4%.
To qualify for retirement benefits, a worker must accumulate at least 40 work credits, equivalent to approximately ten years of contributions. In 2026, every $1,810 in Social Security-covered earnings generates one credit, with a maximum of four credits per year. The monthly benefit is calculated using the worker’s 35 highest-earning years, adjusted for inflation.
Key Retirement Ages
The SSA defines three milestones for accessing benefits:
- Age 62: the earliest age to claim, with a permanent reduction of up to 30% of the full benefit for those whose Full Retirement Age is 67
- Ages 66 to 67: Full Retirement Age (FRA), which varies by year of birth. Those born in 1960 or later have an FRA of 67
- Age 70: the maximum age to delay claiming, with an 8% annual bonus on the full benefit for each year deferred between FRA and age 70
The average monthly benefit paid in January 2026 was around $1,980 for a typical retiree. The maximum benefit for someone retiring at FRA is approximately $4,000 per month, and can exceed $5,100 for those who delay until age 70.
The Brazil-U.S. Totalization Treaty
The Social Security Agreement between Brazil and the United States entered into force on October 1, 2018, and is administered by the SSA in partnership with Brazil’s INSS. This agreement is critical for Brazilians who worked in both countries without independently completing the contribution period required to retire under each system.
Under the treaty, contribution periods in one country may be combined with those in the other for the purpose of meeting eligibility requirements — a process called totalization. The final benefit calculation, however, is proportional: each country pays only the share corresponding to the time actually contributed within its own system. The agreement also eliminates dual social security taxation for temporary expatriate workers, with certificates of coverage issued by either the INSS or the SSA as applicable.
Brazilians with fewer than 40 U.S. credits can use their Brazilian contribution history to meet the minimum requirement. Conversely, Americans with time in Brazil can fill gaps in INSS eligibility. The application can be filed in either country, and the agencies communicate directly with each other.
Who Qualifies as an Immigrant
The right to Social Security benefits is not tied to U.S. citizenship. Lawful permanent residents (green card holders) and work visa holders who contributed to FICA are eligible for retirement benefits. Undocumented workers who contributed under a valid SSN may also be entitled to benefits if they later regularize their immigration status.
There are, however, restrictions on receiving benefits outside the United States. Brazilian citizens can generally continue receiving monthly payments even while living in Brazil, under the SSA’s general rules. The SSA maintains the Payments Abroad Screening Tool to confirm eligibility on a case-by-case basis.
401(k): Employer-Sponsored Retirement Plans
The 401(k) is the most common employer-sponsored retirement plan in the United States. It functions as a tax-advantaged investment account in which the employee chooses how much to contribute from their paycheck, and the employer often adds a match, contributing up to a certain percentage of the employee’s salary.
The 2026 contribution limits set by the IRS are:
- $24,500 in annual employee contributions for workers under age 50
- $8,000 in additional catch-up contributions for those aged 50 and older
- $70,000 combined limit between employee and employer contributions ($78,000 with catch-up)
A traditional 401(k) allows a tax deduction in the year of contribution, with taxes applied upon withdrawal. The Roth 401(k) uses after-tax contributions and allows tax-free withdrawals in retirement — an option that tends to be advantageous for those who expect to be in a higher tax bracket later. Withdrawals before age 59½ are subject to a 10% penalty in addition to income tax, with limited exceptions.
IRA: Individual Retirement Accounts
An IRA (Individual Retirement Account) is an account opened directly by the worker through brokerages such as Fidelity, Vanguard, or Charles Schwab. Unlike the 401(k), it does not depend on an employer and offers greater investment flexibility.
IRA contribution limits in 2026 are $7,000 per year for those under 50 and $8,000 per year for those 50 and older with catch-up. There are two types: the traditional IRA, which allows income-conditional deductions, and the Roth IRA, which uses after-tax contributions and offers fully tax-free growth. The Roth IRA has income eligibility limits, with a phase-out beginning around $161,000 for single filers in 2026.
An Integrated Strategy for Brazilians in the U.S.
The strongest approach combines all three pillars. Brazilians who have recently arrived should apply for a Social Security Number as soon as they receive work authorization, ensure their employer withholds FICA correctly, and start accumulating credits. At the same time, they should enroll in the company 401(k), capture the full employer match (typically 3% to 6% of salary), and open an IRA to supplement their savings.
For those who immigrate after years of INSS contributions in Brazil, the bilateral treaty is the tool that prevents a total loss of that history. Even if the U.S. retirement benefit ends up modest, American contribution time can help build eligibility for the Brazilian pension, or vice versa. Periodic review of the overall strategy is essential, as contribution limits, tax rates, and portability rules are adjusted annually by the IRS and the SSA.
Costly Mistakes to Avoid
Four common mistakes appear frequently among Brazilians in the U.S. The first is treating Social Security as a complete retirement plan: the average benefit covers only about 40% of pre-retirement income, requiring supplemental savings. The second is leaving employer match money on the table by not enrolling in the 401(k) — it is equivalent to turning down part of your salary. The third is being unaware of the bilateral treaty and abandoning contribution history in one of the two countries. The fourth is cashing out a 401(k) when changing jobs instead of doing a rollover to an IRA, triggering unnecessary taxes and penalties.
Planning for retirement in the United States is a long-term endeavor that requires specific technical knowledge, annually updated figures, and ongoing review. The combination of Social Security + 401(k) + IRA, along with the Brazil-U.S. treaty when applicable, provides a robust framework for reaching retirement with financial security in both countries.
Victoria Harper
Editor-in-Chief
Leading journalism and editorial content at Visto n’ Visa, Victoria helps make immigration topics clear, trustworthy, and easy to understand. Her focus is on delivering useful, human, and relevant content for people exploring new paths abroad.
