Since she was 12 years old, Emma Echols has worked as a babysitter, a chef and a convenience store manager.
Echols lives in Alabama. She’s never made much money and has always lived frugally, but rent and transportation alone cost her $1,000 a month. She started receiving Social Security early and receives $1,056 a month, 25% less than she would have received if she had waited until the federal retirement age of 67.
But to pay the remaining bills, she still works part-time as a bus driver, making $26 an hour.
“I don’t think I’ll ever be able to retire, but I’m grateful and I’m healthy,” she said.
She’s not alone: A NerdWallet survey of 2,100 adults published last week found that only 30% of respondents believe Social Security alone will be enough to live comfortably in retirement.
Over the past few months, Business Insider has spoken to more than 40 Baby Boomers and several Gen Xers who say they’ve been stuck saving enough for years because of debt, low-paying jobs, or unforeseen life circumstances, and they worry they’ll struggle to retire or won’t be able to retire at all. Many say they’re grateful for their Social Security benefits, but they’re not enough to make up for the shortfall.
Social Security is supposed to be a safety net for American retirees, but as a constant political target, it may seem less secure than ever: Full benefits are scheduled to expire in 11 years unless Congress steps in with an infusion of funds.
“A lot of people consider Social Security to be a very important part of their retirement,” said Tracy Groniger, managing director of financial security at the advocacy group Justice in Aging.
Even with full current benefits, some baby boomers will have to keep working into their 70s and 80s, while retirees worry they may have to go back to part-time work. Some are considering moving abroad or moving with their children to lower their living expenses.
“At this point in life, expectations are so low,” said Cheryl Simmons, 62, who lives in her car in San Diego and makes $42,000 a year as a parking attendant — a bit too much to qualify for affordable housing. “You have to work yourself to the point of collapse.”
Social Security benefits vary by age and income, but the average monthly benefit is $1,907.
Created in 1935, Social Security was created during the Great Depression to help more than half of Americans living in poverty, including older workers looking to retire.
“To grow old is no tragedy, but to grow old without the means of living is,” President Franklin D. Roosevelt said in a 1934 speech.
Social Security benefits are based on a worker’s average monthly earnings over their highest 35 earning years, adjusted for inflation.
For example, the SSA estimates that an American with an average annual income of about $66,000 retires at age 65, and Social Security will provide 39 percent of that income, compared with average replacement rates of just over 50 percent in OECD countries and nearly 80 percent in Spain and Greece.
Americans can start claiming Social Security benefits as early as age 62, but the longer you wait, the higher your monthly benefit will likely be. In 2024, if you claim before age 70, you could get up to $3,822 a month, and if you claim at age 70, you could get up to $4,873 a month. The average monthly benefit, however, is much lower, at $1,907.
In today’s America, a salary just under $23,000 a year isn’t much. Social Security doesn’t promise a lavish lifestyle, and it’s ideal to combine it with savings and other investments, but the Baby Boomers BI spoke to said life events and low wages got in the way and meant they were barely able to save anything.
They’re among the 1 in 5 seniors who have no retirement savings at all, a trend that experts say is partly to blame as Americans in the 1980s switched from pensions to 401(k) accounts, which largely replaced guaranteed employer-funded retirement benefits with investment plans into which employees signed up and provided the bulk of their savings.
Many employers offer employees a 401(k) match, but the amount varies widely from company to company, and because participation and employer matching are voluntary and based on income, this opt-in system can reduce employees’ retirement savings and further widen income inequality.
To cover living expenses, about 80 percent of retirees receive some sort of Social Security income, according to BI calculations, and the Social Security Administration estimates that 97 percent of seniors will eventually receive benefits.
Social Security does help older Americans escape the definition of poverty, but the official poverty line is based on a formula from the 1960s, and experts have previously told BI that the metric is outdated and leaves many people who need help falling into the gap because they make too much.
The Baby Boomers BI spoke to aren’t in the group with myriad investments, high-paying jobs or robust 401(k) employer contributions. They’re retired teachers, ride-share drivers, food service and retail workers, some of whom are living in their cars or can’t afford groceries and are certainly feeling the effects of living in poverty.
However, some people live in areas with minimal expenses and a low cost of living and are able to live comfortably on Social Security alone.
Those who already run out of money before payday say they are being forced to dip into savings accounts because their income is not enough to cover medical or unexpected expenses. And limited Social Security benefits are forcing some baby boomers to sign up for other government assistance programs, like SNAP, to put food on the table or return to work after retirement.
Mary Dacus, 62, and her husband, Steven, 67, live in Robinson, Illinois, and together they get by on $2,140 in Social Security benefits and $23 a month in SNAP income. Paying for groceries, utilities and medical bills has piled up thousands of dollars in credit card debt. They feel it’s the only way they can survive.
“A lot of people think that with Social Security, you get a big check and you can move to Florida and buy a boat and go fishing,” she says, “but that’s not the case.”
Becky Davenport, 61, works for a nonprofit outside Anchorage, where the cost of living is high. She told BI that her $2,000 monthly Social Security benefit might not be enough. The single mother worries she might have to move in with her sons or find roommates. Medical, housing and transportation costs are all eating into her savings.
“I always had more money going out than coming in,” Davenport said. “I was a master of managing my bills. I had some emergency credit cards, but I ended up defaulting on them all. I managed to make ends meet and provide a home for my kids.”
Solutions for Social Security could include raising the earnings cap and increasing funding.
With the presidential election approaching, Social Security is likely to find itself in tough conditions again.
Although Social Security is expensive (it accounted for 21% of the federal budget in 2023), it is widely popular. Public opinion polls consistently show bipartisan support for the program. An April 2024 Pew Research Center poll of 8,709 adults found that nearly all groups believe Social Security benefits should not be cut, including 77% of Republicans and 83% of Democrats.
Already, former President and current Republican nominee Donald Trump has proposed cutting taxes on the benefits, a move some economists say could actually cause the benefits to run out of funds more quickly.
Senators Bernie Sanders and Elizabeth Warren, along with other Democrats, have proposed raising the Social Security tax cap to offset the $2,400 annual increase in benefits. Currently, Social Security only taxes people up to $168,600 in income; anything above that is tax-free. Meanwhile, some House Republicans have proposed raising the eligibility age for the program.
These proposals come against the backdrop of already dwindling funding.
“We really want a stronger Social Security system,” said Groniger, who said the system already lifts millions of adults out of poverty, but that it’s “not a big deal” because the U.S. poverty line is so low.
“There’s a lot more we can do, because I think what we want is for people to actually have real economic security and feel like they can afford not just what they need, but what people should have,” Groniger said. “They don’t have to worry about whether they can pay for food, medicine, housing, all of that.”
But the dire situation older Americans find themselves in, despite Social Security, points to a larger problem that could get even worse: retirement is becoming a luxury. As pensions disappear and only high-income retirees have savings, Social Security may become even more important for retirees. And it’s already not working very well.
“I don’t want to be rich. I just want to live comfortably,” Angela Babin, 62, who lives on a monthly Social Security payment of $1,100, told BI. “I just want to know that I’ll have food when I need it and a comfortable roof over my head.”
Are you getting by on Social Security? Have you ever felt lonely because of money? If so, contact our reporters at allisonkelly@businessinsider.com, nsheidlower@businessinsider.com or jkaplan@businessinsider.com.
