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Measuring Social Security Dependency Among Retirees - Investopedia.com
We’ve all seen the statistics. How many senior households depend totally on Social Security benefits to survive, how many are partially dependent, and so on. These statistics are referenced repeatedly in articles addressing the need for systemic changes and are often cited as measures of seniors’ proximity to the federal poverty line. So, given their widespread use as reference material and given the difference in quoted statistics, one wonders about the process used to generate the numbers. One source may suggest, for example, that Social Security benefits account for the total income of 39% of households, while another may put the figure at about 14%. With Congress likely to give weight to this measure as it seeks solutions to Social Security’s looming insolvency, the need for a finer point in gauging this demographic is essential.
Investopedia contributor Peter Gratton, Ph.D., offers an analysis of the process, citing the differences between survey data and the use of actual tax records to develop percentages. It’s an interesting piece, shedding light on what the measurements really mean. Check it out here…
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