As officials and analysts continue to report on the impending financial doom of the federal Social Security programs, it becomes easy to get swept up in the negatives. Yes, if Congress does not act, Social Security Disability and similar programs face financial difficulties in the coming years. However, Social Security is a near-universal priority throughout the White House and Congress, and it is unlikely that lawmakers will allow the programs to fail for lack of funds, leaving millions of Americans with no income.
However, amid all the conflicting and often misleading reports from and about the Social Security Administration, it can be helpful to simply examine the facts surrounding Social Security Disability and other Social Security programs, as well as their current and future financial status.
- In 2010, Social Security replaced approximately 40 percent of working-age earnings for an average 65-year-old retiree. Current financial predictions drop the “replacement rate” to 31 percent in the coming years and decades.
- Even with Social Security retirement earnings, 10 percent of retirees are below the poverty line. Without Social Security, however, 45 percent of that group would be under the poverty line.
- In 1935, an average 60-year-old white male had a life expectancy of 75 years. Today, the same 60-year-old white male can expect to live to age 80.
- Income also plays into life expectancy. In 1972, a 60-year-old white male in the bottom half of the income distribution could expect to live to 78 years old. Today, that man lives to about 80. In contrast, 60-year-old males in the top half of the income distribution could expect to live to about 79 in 1972, and to 85 today.
- The longer a worker waits to collect Social Security benefits, the larger his or her average benefit checks will be. Most people begin receiving checks at age 62. Waiting until age 66 means that checks will be an average of 33 percent larger.
Obviously, these facts regard the general Social Security retirement program, and not specifically Social Security Disability. However, as both fall under the vast and struggling Social Security umbrella, it is important to be informed on the program as a whole.
Source: Washington Post, “Eight facts and three thoughts about Social Security,” Ezra Klein, 10 May 2011