Despite the program’s wide reach, approximately 3.3% of people aged 62 to 84 will never get Social Security, according to data from the 2023 Trustees Report, and they face particular obstacles and greater poverty rates than their beneficiaries.
Millions of Americans depend on Social Security benefits to meet their financial needs. This year, about 68 million Americans will receive monthly Social Security benefits. The great majority of beneficiaries, around 75%, are retirees who got an average monthly check of $1,918 as of June.
Who Are the Never-Beneficiaries?
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The never-beneficiary population is diverse and exhibits notable trends in its composition. Data from May 2024 indicates that this group is primarily characterized by:
- Gender: 63% are women.
- Ethnicity: 28% identify as Hispanic.
- Immigrant Status: 49% are immigrants.
- Marital Status: 21% are never-married individuals, while 20% are widows.
- Education Level: 36% have less than a high school education.
These factors contribute to their inability to access Social Security benefits, which can provide a vital safety net in retirement.
Categories of Never-Beneficiaries
Researchers have identified three primary groups within the never-beneficiary population:
- Late-Arriving Immigrants (49%): This group consists of individuals who enter the United States at age 50 or older, often missing the opportunity to accumulate sufficient work credits for Social Security eligibility.
- Infrequent Workers (38.9%): Individuals who have not worked enough over their lifetime to earn the requisite credits fall into this category. Many of these workers may have faced barriers to consistent employment.
- Noncovered Workers (10.8%): Primarily made up of state and local government employees, this group typically does not contribute to Social Security and, therefore, is ineligible for benefits.
- Additionally, 1.3% of this population may die before they can receive benefits, further underscoring the vulnerabilities they face.
Poverty Rates Among Never-Beneficiaries
The disparities in economic well-being between never-beneficiaries and those who receive Social Security are stark. The overall poverty rate among never-beneficiaries is alarmingly high at 54.3%, compared to just 5.8% for current and future beneficiaries. This contrast highlights the critical role Social Security plays in supporting financial stability for retirees.
Income Sources for Never-Beneficiaries
The never-beneficiary population relies on various income sources, which differ significantly from those of Social Security recipients:
- Late-Arriving Immigrants: This group often depends on coresident income, accounting for 36.5% of their household income, reflecting a reliance on family or community support.
- Infrequent Workers: A significant portion of these individuals, about 31.2%, receive Supplemental Security Income (SSI), which provides some assistance but is generally lower than Social Security benefits.
- Both Groups: Asset income is another common source, although at much lower levels than that of beneficiaries. This suggests a greater vulnerability in times of financial need.
Future Projections for Never-Beneficiaries
The percentage of never-beneficiaries is expected to decline slightly, projected to decrease from 3.7% in 2010 to 3.1% by 2030. While this may seem like a positive trend, the persistently high poverty rates among this group remain a significant concern for policymakers and researchers dedicated to improving the well-being of the elderly.
Conclusion
The challenges faced by individuals aged 62-84 who will never receive Social Security benefits highlight a critical aspect of the social safety net in the United States. With higher poverty rates and limited access to resources, it is essential for policymakers to address the needs of this vulnerable population. Understanding the demographics and economic realities of never-beneficiaries is a crucial step toward developing effective strategies to support their financial security and overall quality of life.
