Social Security Turns 90: The Cornerstone of Retirement Income

Strategic Insights -

As Social Security celebrates its 90th anniversary, a new report by the Transamerica Center for Retirement Studies (TCRS) highlights the program's critical role in providing financial security for millions of Americans. The survey-based report, released in collaboration with the Transamerica Institute, examines Americans' beliefs, expectations, and reliance on Social Security, shedding light on how to address its funding shortfalls. The findings demonstrate the vital importance of Social Security, especially for low- and moderate-income households and women, who are more likely to rely on the program as their primary source of retirement income.

Key Takeaways:

  • Almost seven in 10 Americans (69%) expect Social Security as a source of retirement income, with 32% relying on it as their primary source of retirement income.
  • The survey found that 71% of people who are not yet retired are concerned that Social Security will not be there for them when they are ready to retire.
  • To address Social Security's funding shortfall, respondents suggested increasing the maximum earnings subject to payroll taxes (38%), increasing the Social Security payroll tax rate (35%), preserving retirement benefit payments for retirees in greatest need (28%), and raising the retirement age (22%).
  • 53% of retirees indicate Social Security will be their primary source of income throughout their retirement.
  • People who are not yet retired have saved $51,000 in total household retirement accounts (estimated medians), with men saving more than women ($67,000 vs. $35,000).
  • Retirees have $126,000 in total household savings excluding home equity (estimated median).
  • Women are more reliant than men on Social Security for retirement income, with 36% of women citing it as their expected primary source of retirement income compared to 27% of men.
  • Reliance on Social Security is greater among retired women, with nearly six in 10 women retirees citing it as their primary source of income.
  • People in low- to moderate-income households are more reliant on Social Security, with over half citing it as their primary source of retirement income.

Statistics:

  • 69% of Americans expect Social Security as a source of retirement income
  • 32% of Americans rely on Social Security as their primary source of retirement income
  • 71% of people who are not yet retired are concerned that Social Security will not be there for them when they are ready to retire
  • 53% of retirees indicate Social Security will be their primary source of income throughout their retirement
  • People who are not yet retired have saved $51,000 in total household retirement accounts (estimated medians)
  • Retirees have $126,000 in total household savings excluding home equity (estimated median)
  • Women have saved $35,000 in total household retirement accounts (estimated medians)
  • Retired women have saved $79,000 in total household savings excluding home equity (estimated medians)

Sources:

  • Transamerica Center for Retirement Studies (TCRS)
  • Transamerica Institute
  • The Harris Poll
  • The Harris Poll report, "Social Security Turns 90: The Cornerstone of Retirement Income"