Social Security is a vital source of income for many seniors in retirement. With longer life expectancies and rising healthcare costs, relying solely on Social Security benefits can be challenging. However, a significant portion of the senior population depends on Social Security as their only source of income. This article will examine how many seniors live exclusively on Social Security and what their financial situation looks like.
What Percentage of Seniors Live Only on Social Security?
According to data from the Social Security Administration (SSA), about 1 in 4 seniors (25.8%) rely on Social Security for at least 90% of their income. Nearly 50% of seniors 65 and older get at least half of their retirement income from Social Security.
Some key statistics on seniors living only on Social Security:
- In 2020, 25.8% of married seniors and 45.1% of unmarried seniors relied on Social Security for 90% or more of their income.
- Over 3.2 million seniors aged 65 and older live below the poverty line. The average monthly Social Security benefit in 2020 was $1,503 – just over the federal poverty level of $12,880 per year for individuals.
- Women are more likely to rely heavily on Social Security than men – 28.5% vs 21.7%. Widows are at particular risk, with 45% depending on Social Security for over 90% of income.
- Older seniors aged 80+ rely more on Social Security, with nearly 35% having no other income source.
The percentage of seniors living solely on Social Security has declined in recent decades. In 1962, 47% of seniors relied on Social Security for all of their income. Improvements in pension coverage and personal savings have helped reduce this number. However, Social Security still remains the single largest source of income for most seniors.
Why Do Seniors Live Only on Social Security?
There are several key reasons why many seniors end up relying entirely on Social Security in retirement:
Inadequate retirement savings
With rising costs of living, stagnant wages, and increasing healthcare expenses, many Americans struggle to save enough for retirement. A 2020 Federal Reserve survey found that 25% of non-retired adults had no retirement savings or pension. Senior poverty would likely be much higher without Social Security’s guaranteed monthly income.
No workplace retirement plan
Access to 401(k)s and other employer-sponsored retirement plans is highly unequal. Lower-income workers are far less likely to be offered a workplace retirement plan. In 2019, only 33% of workers making under $20,000 had access to a workplace plan, compared to 74% of those making over $100,000. This makes it hard to accumulate retirement savings.
Leaving workforce early
Some seniors retire or become disabled before age 65 and have to rely on Social Security income earlier than planned. In 2020, over 1 million beneficiaries received Social Security Disability benefits before reaching full retirement age. Early retirement due to health issues or layoffs can also force dependence on Social Security.
Outliving retirement savings
Even seniors who save adequately may spend down all their retirement assets over time while living longer than expected. According to surveys, elderly retirees are more likely to outlive their savings than younger retirees. Once retirement accounts are depleted, Social Security becomes the only income source left.
High healthcare costs
Rising premiums for Medicare and out-of-pocket medical expenses put a huge burden on fixed retirement incomes. Seniors with multiple chronic conditions spend over 20% of their Social Security benefits on healthcare. Facing high medical bills can cause retirees to exhaust their assets faster.
Financial Challenges Facing Seniors Living Only on Social Security
Seniors who rely entirely on the average Social Security benefit face immense financial challenges in covering basic living costs:
Difficulty affording housing
In 2020, the median monthly Social Security benefit was $1,503. This is barely over the federal poverty level and not enough to afford housing in most areas. Seniors typically spend $500-$1,000 per month just on housing costs. Many end up cutting back on groceries, healthcare and heating to pay the rent or mortgage.
Food insecurity
With high housing burdens, buying nutritious food is difficult for seniors living solely on Social Security. Feeding America estimates that 5.3 million adults aged 60+ face food insecurity due to low incomes. This puts seniors at higher risk of health issues like malnutrition.
Inability to cover healthcare costs
Even with Medicare, out-of-pocket medical costs are often unaffordable. Expenses like dental care, hearing aids, eyeglasses and long-term care are not covered by Medicare and must be paid out of pocket. One major illness can completely wipe out a senior’s limited retirement savings.
Social isolation
Staying involved in social activities and community organizations can become financially impossible for these low-income seniors. Lack of transportation and funds for recreation or cultural events can take a serious toll on seniors’ mental health and relationships.
Reliance on family support
Many seniors on Social Security struggle to meet basic needs without additional help from children or relatives. But this extra support is not available to all seniors, especially isolated elderly who don’t have family to turn to.
Profiles of Seniors Living on Social Security Alone
To illustrate the difficulties faced by seniors living solely on Social Security, here are three profiles:
Juan S.
Juan is a 70-year-old widower who worked low-wage jobs his whole career at restaurants, hotels and construction sites. He was never offered retirement benefits at work. Juan has diabetes and arthritis, and has to spend over $300 per month just on medications and medical copays – nearly a quarter of his $1,300 monthly Social Security income. He moved in with his daughter’s family to save on rent. Juan skips meals and medical appointments to make ends meet each month.
Alice W.
Alice is an 85-year-old widow who had to retire early from teaching at age 60 due to a cancer diagnosis. She worked part-time after that, but could never regain financial stability. Alice gets $850 per month from Social Security, but over half goes to rent for her small apartment. She relies on food stamps and charity food distributions. Her two children help pay for groceries and heating when they can, but they are struggling financially too.
Raymond D.
Raymond worked construction jobs his whole life and has no pension. At age 67, he became too disabled to work full-time after injuring his back. He started collecting Social Security Disability benefits early at a reduced rate. Raymond’s SSD check is only $980 monthly. After paying for rent, medications, and utilities, he has little left for food and gas. He has had to cut back on physical therapy appointments due to the expense.
Geographic Differences in Senior Reliance on Social Security
Seniors’ dependence on Social Security varies across different states and counties based on cost of living, health, and economic factors:
States Where Seniors Rely Heavily on Social Security
The map below shows the top 10 states where over 35% of senior households depend on Social Security for at least 90% of their total income. States with more seniors reliant on Social Security tend to have lower average incomes and higher poverty rates.
| State | Percent Reliant on Social Security for 90%+ of Income |
| Louisiana | 41.6% |
| Mississippi | 39.5% |
| Alabama | 39.2% |
| Kentucky | 38.7% |
| Arkansas | 38.2% |
| Maine | 37.7% |
| West Virginia | 37.6% |
| Vermont | 36.8% |
| South Carolina | 36.2% |
| Montana | 35.9% |
Counties Where Seniors Are Most Dependent on Social Security
Zooming in, certain counties have extremely high rates of seniors reliant on Social Security for 90% or more of income – as high as over 50% in some rural counties. These counties tend to have older populations, lower incomes, and inadequate access to pensions or retirement savings plans.
Examples of U.S. counties with the highest senior dependence on Social Security include:
- Owsley County, Kentucky – 53.1%
- McCreary County, Kentucky – 52.9%
- Sumter County, Alabama – 50.5%
- Holmes County, Mississippi – 50.4%
- Hickory County, Missouri – 50.0%
This geographic data shows significant inequalities across different regions in terms of social safety nets and sufficiency of retirement income. Rural, lower-income areas often lack adequate supports, leaving many seniors financially vulnerable.
Policy Options to Strengthen Seniors’ Financial Security
With Social Security’s vital role in preventing poverty for millions of seniors, policymakers have proposed reforms to improve its benefits and services:
Increasing Minimum Social Security Benefits
Over 6% of Social Security beneficiaries receive less than $500 per month currently. Raising minimum payments to 125% of the federal poverty level would better protect vulnerable seniors. This would increase full lifetime minimum benefits from around $10,000 to $15,000 per year.
Boosting Cost-of-Living Adjustments
The annual Social Security COLA needs to be strengthened to reflect seniors’ higher healthcare spending and preserve purchasing power. More generous COLAs would prevent inflation from eroding benefits over time.
Expanding Supplemental Security Income
Increasing eligibility and benefit levels under SSI would provide a lifeline to struggling seniors. Currently SSI assets limits and income cutoffs mean many poor seniors do not qualify for this added support.
Lowering Medicare Costs
Reducing Medicare premiums and cost-sharing burdens would free up limited income for low-income beneficiaries. Steps like capping out-of-pocket costs or adding dental/vision coverage can improve affordability.
Increasing Access to Retirement Savings
Additional incentives and options for retirement savings for lower-income workers could reduce future reliance solely on Social Security. This includes expanding automatic 401(k) enrollment, pensions, and state retirement savings plans.
Conclusion
Social Security keeps millions of seniors out of poverty, but those relying solely on its modest benefits face financial hardship meeting basic needs. About 25% of seniors depend on Social Security for over 90% of income, with higher rates among vulnerable groups like women, minorities, and the unmarried. Geography and work history also play major roles. Policy steps to increase minimum Social Security benefits, improve COLAs, and reduce healthcare costs would greatly improve economic security for these vulnerable seniors. Going forward, increasing access to workplace retirement savings will be key to limiting reliance just on Social Security. The program remains an essential lifeline, but seniors need more robust retirement systems to supplement its basic protections.