How Much Do Americans Depend on Social Security?

Policy Reports | Social Security

No. 301
Tuesday, August 07, 2007
by Laurence J. Kotlikoff, Ben Marx and Pietro Rizza


"Bottom line: Americans at most income levels depend on Social Security."

Reductions in projected benefits for younger workers — particularly for higher earners — are increasingly likely as time passes and no substantive solutions are enacted. The implications of the above scenarios for Social Security reform must be carefully examined. The bottom line is that Americans at most income levels depend on Social Security. Younger, lower-income households that cannot borrow or reduce their current consumption would experience a much greater decline in their retirement standard of living if benefits were cut. But even many higher earners would face lower retirement living standards. Making changes in Social Security now to be implemented in the future would give workers time to adjust their current levels of consumption and retirement savings. However, many workers are unprepared to make the necessary adjustments.

NOTE: Nothing written here should be construed as necessarily reflecting the views of the National Center for Policy Analysis or as an attempt to aid or hinder the passage of any bill before Congress.

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