Who Will Never Receive Social Security and Why Alternative Income Falls Short

Many people depend on Social Security benefits to make ends meet. However, 3.3% of people aged 62 to 84 will never get these benefits, which presents them with a unique set of problems. This information, which comes from the 2023 Trustees Report, shows a group of people who have higher rates of poverty than people who get Social Security.

Millions of Americans depend on Social Security to keep their finances stable. Almost 68 million people will get a monthly payment from Social Security this year. About 75% of these people are retired workers, and as of June, each was getting an average monthly check of $1,918.

Who are the individuals who will never receive Social Security benefits?

Based on data from May 2024, this diverse group comprises higher proportions of the following demographics:

• Women (63%)
• Hispanics (28%)
• Immigrants (49%)
• Never-married individuals (21%)
• Widows (20%)
• Those with less than a high school education (36%)

There are some trends and numbers that stand out when looking at Social Security and the people who get it, especially those aged 50 and up. These can help you understand the problems that different groups are having.

Understanding the Different Types of Workers

• Infrequent Workers (38.9%): This group includes individuals who have not amassed sufficient work credits, which are necessary to qualify for Social Security benefits.
• Noncovered Workers (10.8%): Mainly comprised of state and local government employees, these individuals are not covered under the Social Security system.
• Die Before Receiving Benefits (1.3%): A small percentage of individuals pass away before they have the opportunity to receive their benefits.

Poverty Rates Among Never-Beneficiaries

The statistics highlight a significant disparity in poverty rates:

• Overall Never-Beneficiary Poverty Rate: A staggering 54.3% of those who never receive benefits live in poverty.
• Current and Future Beneficiary Poverty Rate: In contrast, only 5.8% of those who are current or future beneficiaries experience poverty.

Income Sources for Never-Beneficiaries

Unlike Social Security recipients, never-beneficiaries depend heavily on alternative income sources:

• Late-Arriving Immigrants: Often depend significantly on coresident income, which constitutes 36.5% of their household income.
• Infrequent Workers: This group is more likely to receive Supplemental Security Income (SSI), with 31.2% relying on it.
• Both Groups: While asset income is a common source for both, it is generally at lower levels compared to those who receive Social Security benefits.

A Decline in Never-Beneficiaries Expected

The percentage of people who have never received benefits is expected to slightly drop over the next few years, which is good news. This trend points to possible changes that could be made to the system to cut down on the number of people who are still not getting benefits.

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