Research Studies

Social Security an Increasing Income Source for Aging Population

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Employee Benefit Research Institute, May 2007

According to a study published by the nonpartisan Employee Benefit Research Institute (EBRI), Social Security provides a growing source of income as the nation's elderly population ages. The EBRI study found that the share of the older population's 2005 income that came from Social Security rises from 30 percent for those ages 65–69 to 55 percent for those ages 85 and older. The number was higher for each progressively older age group.

On average, Social Security provided 40 percent of the income for all those age 65 and older in 2005. However, gender and income greatly influence the importance of Social Security to the elderly, the report finds:

Gender: Elderly women received 50 percent of their income from Social Security, compared with 33 percent for elderly men.
Income: The lowest-income quartile (less than $7,895 a year) among the elderly received 91 percent of their income from Social Security in 2005, while the highest-income quartile (more than $32,198 a year) received 18 percent of its income from Social Security.

Overall, the leading sources of income for those age 65 and older in 2005 were:

Social Security: 40.1 percent
Pension and annuity income: 19.3 percent
Income from assets: 13.6 percent
Income from earnings: 24.8 percent
Other: 2.2 percent

The study reported that average income for those age 65 and older in 2005 was $24,418, up from $17,037 in 1974. The median income for those age 65 and older in 2005 was $15,422, up from $12,074 in 1974. However, median income was $131 lower in 2005 than in 2004. All numbers are in constant 2005 dollars, the study notes.

The study was published in the May 2007 EBRI Notes, available at www.ebri.org. EBRI is a private, nonprofit research institute based in Washington, DC, that focuses on health, savings, retirement and economic security issues.

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