How Many Seniors Rely Mostly On Social Security?

In a way, I know what it must be like to live on Social Security only. I retired at 50 and because of that my pension was reduced by 12% and I was too young to collect SS, I never asked my husband to contribute to my personal expenses; he was having financial troubles of his own trying to keep his business afloat and literally paying out more than he was taking in at times.

When I first retired, I was getting approximately $1,200 a month. As I've mentioned on the forum a few times, what helped me is that I was debt free, live in a co-op where our housing expenses are extremely low, have great retiree health benefits (including prescription coverage) and a nice nest egg that I continued to contribute to. We were getting pension COLAs for a few years after I retired, but they were discontinued when Christie became our governor. I didn't like it, but realized it was necessary because our pension plan was short by billions.
 
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When I tried to research this very thing several years ago I realized the question is wrong. We all get different amounts for our social security...therefore whether or not we can and do live on that amount is relative to our personal situation. I only receive about 1300 a month ss. I would be hard put to pay my bills with that amount over time without other forms of income. And I own my home and have zero debt. I do not exactly know the correct question...
 
OneEyedDiva said:
I'm surprised to read that your pension amount was based on how much you had in assets. I'm not familiar with your pension system...so is the pension a state pension, not connected to contributions from work? It's nice that you are living very comfortably now.
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The state pension is means tested there is an assets test and an income test which ever results in the least pension is the one they apply.


I think it is fair because no one contributes toward the state pension and everyone is entitled to it.


People's dependence on it is reducing due to compulsory superannuation which has been in force since the 1980s


https://www.servicesaustralia.gov.au/how-much-age-pension-you-can-get?context=22526
 
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Wombat said:
The state pension is means tested there is an assets test and an income test which ever results in the least pension is the one they apply.


I think it is fair because no one contributes toward the state pension and everyone is entitled to it.


People's dependence on it is reducing due to compulsory superannuation which has been in force since the 1980s


https://www.servicesaustralia.gov.au/how-much-age-pension-you-can-get?context=22526
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Interesting. Thank you for the explanation.
 
OneEyedDiva said:
Interesting. Thank you for the explanation.
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I've long wondered how superannuation works and spent some time learning about it this morning.

From what I can gather, superannuation is sort of a hybrid of SS and (portable) 401K plans.

AU employers make compulsory contributions (currently a minimum of 12% of an employee's wages), most of which is subject to lower income tax rates. Employees can also contribute to those annual savings, but anything above a combined employer/employee total of $30K AU ($21,500 US), loses tax advantages.

These funds are invested in equities (stocks), commercial & residential real estate, and fixed income assets (bonds).

According to Wikipedia:

At retirement, each member has a lump sum balance. Most superannuation funds offer an account-based (drawdown) product for drawing retirement income. Some funds provide access to lifetime annuities purchased using the member's balance.

A person can withdraw funds out of a superannuation fund when they meets one of the conditions of release, such as retirement, terminal medical condition, or permanent incapacity, as noted in Schedule 1 of the Superannuation Industry (Supervision) Regulations 1994.[32] As of 1 July 2018, members have also been able to withdraw voluntary contributions made as part of the First Home Super Saver Scheme.

Upon death, superannuation balances are paid to survivors.
 
Social Security unfortunately, was never meant to be your only source of income. Besides if you can still work, why shouldn't you keep working? I still do. Besides I have always liked working in healthcare (nursing homes). Of course I just work part time, between 20-25 hours a week. My feet can't work 8 hour shifts anymore. I tried retirement for about a year. I was bored silly. Besides, my bank account kept shrinking.
 
Paladin1950 said:
Social Security unfortunately, was never meant to be your only source of income. Besides if you can still work, why shouldn't you keep working? I still do. Besides I have always liked working in healthcare (nursing homes). Of course I just work part time, between 20-25 hours a week. My feet can't work 8 hour shifts anymore. I tried retirement for about a year. I was bored silly. Besides, my bank account kept shrinking.
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I remember reading about and seeing depictions of the three legged stool. One of those legs was SS, the other personal savings and the third may have been pensions, since they were more common back then. Why not keep working if you can still work? Because some people absolutely hate their jobs. Can you imagine going to work 5 days a week for years and hating every minute you're there?! Some have jobs that are too stressful and actually pose a threat to their health. Not everyone experiences what you did. Some people have plenty to keep them busy during retirement.

But I've known others like you that would rather keep working. And I say hats off to you! One of our SF members expressed that. There was a nice woman in the city health department's HR department that vowed she would work until she died. Unfortunately, she got sick and had to retire. I forgot how long she lived after that. Also I saw a story about a man in his 90s who was still working as a truck driver.

I worked in the healthcare field too (public health) and loved my job, but couldn't wait to retire. I did have a heart condition that kicked me from time to time since I was 28 years old. By age 50, I felt it was time.
 
OneEyedDiva said:
In a way, I know what it must be like to live on Social Security only. I retired at 50 and because of that my pension was reduced by 12% and I was too young to collect SS, I never asked my husband to contribute to my personal expenses; he was having financial troubles of his own trying to keep his business afloat and literally paying out more than he was taking in at times.

When I first retired, I was getting approximately $1,200 a month. As I've mentioned on the forum a few times, what helped me is that I was debt free, live in a co-op where our housing expenses are extremely low, have great retiree health benefits (including prescription coverage) and a nice nest egg that I continued to contribute to. We were getting pension COLAs for a few years after I retired, but they were discontinued when Christie became our governor. I didn't like it, but realized it was necessary because our pension plan was short by billions.
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I've hesitated to ask, as I'm probably one of the few people who doesn't know this, but what is a co-op???
 
Sunkist said:
I've hesitated to ask, as I'm probably one of the few people who doesn't know this, but what is a co-op???
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In my case, a co-op means a cooperative housing association. Even though we say we own our apartments, technically each person owns a share in the cooperative. Though there are some similarities to condominiums, most co-ops I've seen have much lower costs, starting with the purchase prices. I've posted this before but we pay $644 a month in HOA fees for the two bedroom apartments. Our mortgage was paid off 14 years ago, so those fees go toward taxes, heat and hot water, as well as into the reserves for repairs of common areas and maintaining the grounds. Even when the mortgage was being paid, our monthly costs were lower than $644 because we were on the PILOT program (not being taxed). We have since had two increases to bring it to the current price.

Comparable apartments in our area, if they are decent, start at $2,150 and average $2,600. Two bedrooms in Bergen County, the next county over start at $2,610 but the average is probably somewhere between $3.200 and $3,700. I saw that one of the two bedroom apartments in pricey Ft. Lee (closest to New York City) is $5,437 !!
 
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" Mary Johnson, an independent Social Security and Medicare policy analyst, lifted her 2027 COLA forecast to 3.2% from 1.7% after March’s 3.3% annual inflation reading, the highest in nearly two years. The increase was fueled by soaring energy prices following Iran’s closure of the Strait of Hormuz, which disrupted global oil flows and drove U.S. gasoline and fuel oil prices sharply higher. The Senior Citizens League’s projection remains at 2.8%, matching the 2026 COLA." These are estimates and it won't be really known until Oct. " The official 2027 COLA will be set in October based on July–September CPI-W data " Somewhat of a heads up. :)
 
We don't mainly because my wife set a plan in motion that made it possible for her to quit her job after 8 years & for me to retire earlier than the planned retirement at age 55.

While I still shop for bargain food pricing I tend to think of that as making it possible to enjoy things like making a reservation at Anthony's buffet at the M casino. I called in Jan. & was surprised it took until mid May to have a confirmed reservation.
M Resort Buffet: The Most Expensive Buffet In Las Vegas In 2026
 
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" The Senior Citizens League, which issues monthly projections on the COLA for Social Security, said in a statement Tuesday the 3.9 percent for 2027" ~ zero hedge
" The Social Security cost-of-living adjustment for 2027 is estimated to be as high as 4.2% as inflation continues to rise, largely driven by higher energy costs stemming from the Iran war. " ~ Washinton Examiner - Just a heads up, wishing all well.
 
My mother lived totally on her $1200 SS check. But she had no debt and no car. She lived in a house I owned and paid $300 a month rent. She insisted on paying rent. I never told her this didnt even cover the taxes. :D

I live on my SS but its by choice. I even manage to save some. I have a larger check because of my job and I waited till I was 70.
My house and car are paid for. My house is stuffed with stuff and I have plenty of clothes. My biggest expense is groceries.
 
Veronica said:
My mother lived totally on her $1200 SS check. But she had no debt and no car. She lived in a house I owned and paid $300 a month rent. She insisted on paying rent. I never told her this didnt even cover the taxes. :D

I live on my SS but its by choice. I even manage to save some. I have a larger check because of my job and I waited till I was 70.
My house and car are paid for. My house is stuffed with stuff and I have plenty of clothes. My biggest expense is groceries.
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@Veronica as long as you don't start chalanting, sounds like you'll be okay ma'am :cool:
(love that quote in your signature)
 
In one of my first jobs after finishing undergraduate, the company I was working for had an investment manager give a talk on the three legged stool. I was determined to follow that plan. That, plus living below one’s means - that does not mean being a martyr! It’s having a moderate priced home instead of a McMansion, a regular Ford F150 instead of a Raptor, etc.

Could I live on the one leg - SS? I did a spreadsheet some time ago. Just barely, due to no debt. A big expense like a vehicle, roof, or HVAC replacement would be a problem. Possibly a credit card or loan expense.

Fortunately, I have the other two legs (state pension and investment income). I knew many coworkers over the years that pulled their money out of the state retirement system and/or 401/403 when they changed jobs. Some folks think they are never going to be too old to work - until they are.
 
Calboybob said:
" The Senior Citizens League, which issues monthly projections on the COLA for Social Security, said in a statement Tuesday the 3.9 percent for 2027" ~ zero hedge
" The Social Security cost-of-living adjustment for 2027 is estimated to be as high as 4.2% as inflation continues to rise, largely driven by higher energy costs stemming from the Iran war. " ~ Washinton Examiner - Just a heads up, wishing all well.
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These outlets are merely spitballing. Social Security COLA calculations are made at the end of the third quarter (Sept 30), at which point any COLA increase will be equal to the percentage increase in the CPI-W (Consumer Price Index for Urban Wage Earners and Clerical Workers) over the previous year's end third quarter numbers.

Should the war in Iran end soon or fuel prices settle down, those numbers won't look like they do today.

There's also a concern that the US Bureau of Labor Statistics (part of the Department of Labor) may be pressured to "pretty up" or fudge the numbers. Let's face it, the BLS is an arm of the federal government. 'nuff said on that score?
 
StarSong said:
There's also a concern that the US Bureau of Labor Statistics (part of the Department of Labor) may be pressured to "pretty up" or fudge the numbers. Let's face it, the BLS is an arm of the federal government. 'nuff said on that score?
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The college I retired from used to use a “special calculation” on the federal COLA for our annual COLA. So if federal was 2.5%, they would give us 1.5%. It was always an even number reduction. Nothing special about it. I would called it our annual “diet COLA”. We had a faculty association that was basically powerless and considered a “social club“ by administration.

I expect similar finagling at BLS, as you noted.
 
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After my father passed away, my mother received his Social Security payment, along with a pension from his former company. Her house was paid for, so she only spent on utilities, groceries, Medicare supplement and medications. It was only when her homeowner's insurance was due that we had to withdraw money. I bought her new furniture, but that was out of my pocket. She was living in a 4 bedroom house by herself!

When we moved to Dallas, I moved her to a 3 bedroom villa in a 55+ development. Then everything was pretty much covered until we went through the shock of assisted living payments. I held out for as long as I could, hiring a service to stay with her every day, then my cousin came to live with her until she could no longer handle the falls.
 
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