12 Facts You Should Be Aware of About Social Security

12 Facts You Should Be Aware of About Social Security

A large majority of the American people are recipients of Social Security (SS) at some level, yet many do not grasp the scope and value of the program, which can lead to frustration and confusion when the benefits begin to roll in. In the endeavor to limit discontent or miscommunication, the Social Security Administration (SSA) has expanded its informational output in recent years. Their 2017 fact sheet offered up several statistics for future and current beneficiaries, and we’ve condensed them for you here:

 

  1. In 2017, 62 million Americans will receive $955 billion in benefits
    • Funding comes from 3 sources: a 12.4% payroll tax on earned income, interest on the program’s asset reserves and taxation of the actual benefits
  2. There are 171 million individuals covered by Social Security
    • To qualify, you must collect at least 40 work credits over your lifespan, with the ability to earn up to 4 credits each year (each credit is valued at $1,300)
  3. In 2017, 71% of beneficiaries are retired workers
    • SS payouts increase 8% from ages 62 to 70, so a smart way to improve your payout if you’re nearing retirement is to push back enrollment
  4. The remaining 29% of benefits will go to the disabled and survivors
    • In 2017, disabled workers will receive approximately 16% of benefits and the remaining 13% will be dispensed to survivors of deceased recipients
  5. 61% of seniors rely on Social Security for at least half their monthly income
    • 71% of unmarried retirees and 48% of married seniors rely on SS for a minimum of half their income monthly
  6. 43% of unmarried retirees rely on benefits for around 90% of their income
    • Close to half of single seniors depend on Social Security to provide the majority of their income each month
  7. About 90% of workers are protected in the event of a long-term disability
    • Social Security covers roughly 90% of workers ages 21 to 64 in the event of a work ending disability since only 67% of the private workplace provides long-term disability insurance
  8. About 96% of workers ages 20 to 49 have protective insurance for survivors
    • Since one in eight 20 year olds will not see age 67, most of those working in covered employment have survivors protection insurance for surviving spouses and children
  9. Most 65 year olds will live around 20 more years
    • In 1960, the average life expectancy was 70, but today, life expectancy is 79, which means you should factor in a potentially longer lifespan when calculating benefits since the program is intended to account for 40% of retirement wages
  10. By 2035, the senior population may grow by 65%
    • Individuals 65 and up currently number 48 million people, but the forthcoming retirement of many baby boomers means that number could jump to 79 million over the next 18 years
  11. By 2035, the worker-to-recipient ratio will decrease by 21%
    • Today, the worker-to-beneficiary ratio is 2.8-to-1, but in the next 18 years, experts believe that could drop to 2.2-to-1
  12. 31% of workers report having no retirement money set aside
    • With the possibility of benefits being slashed by 23% in 2034, the reality that one third of the current working population has nothing for retirement besides Social Security, leaving them wholly reliant on the program, is not heartening

Although the Social Security system will likely never be axed completely, and it may cover more retirement income than many believe, Social Security was never intended to serve as the  primary avenue of income, so it would be prudent to begin setting aside additional money for your future.