Report Says Social Security Won't Meet Basic Needs of Most Older Americans

Mark Hake

A report issued by the Elder Index site indicates that Social Security benefits won't meet even the basic needs of older Americans who depend on it.

The report, issued in April 2022 was issued before this year's massive 9.1% year-over-year inflation surge. It indicates that Social Security covers just 68% of basic living expenses of housing, food, transportation, and health care for a single renter in 2021. And for an older couple it covers just 81% of those needs.

It turns out that a quarter of adults age 65 or older depend on Social Security for 90% or more of their family income. More than half of adults age 65 years or older rely on Social Security for at least 50% of their family income.

Social Security was never meant to cover all the needs of older Americans. But the Elder Index finds that fewer than 7% of older adults receive income from other sources of pensions and savings.

Many are now forced to continue to work after receiving Socal Security benefits. In addition, paid work is not an option for those who are unable to work due to disability, health conditions, or caregiving responsibilities.

What Older Americans Need

The Elder Index put together a very useful table of what basic expenses are needed on average across the US. It is divided into whether the household is for a single adult or a couple.

The table below shows these expenses. However, keep in mind that these expenses are before the 2022 massive inflation increase.

In effect, you can increase each of these expenses by 10% to 15% just to catch up with 2022's incredible hike in the cost of living.

So, for example, a single renter in 2022 will likely have a higher cost than $27,096 - perhaps as much as $29,806 to $31,160. That represents a 10% to 15% hike in 2022 alone.

A two-person couple that rents will have an increase from $38,686 to $42,554 to $44,489.

In its second table, the report indicates that Social Security benefits (SSB) cover only 68.4% of the average costs for a single adult in 2021. It covers slightly over 80% of a two-person household.

This implies that in 2022, the amount of SSB coverage has fallen by about 10% to only 59% of a single household's needs. And for a two-person household, it is only about 71%.

This also implies that within 2 years, if inflation continues to rise at this rate, without a massive increase in Social Security benefits, the level of poverty among older Americans will increase dramatically.

This could become a crisis, especially if the rise in Medicare Part B plan cost increases essentially take away much on the COLA (cost of living adjustment) benefits with Social Security. I recently wrote an article in NewsBreak about how the COLA increases are calculated and the effect from Medicare Part B plan increases.

Bottom Line: It might be worthwhile to watch the Elder Index site to gauge how they figure the massive hike in inflation in 2022 has affected their index. In fact, you can enter in your county and see what the averages are for your specific area in the U.S.

In addition, older Americans may need to make plans to arrange for additional sources of income. The reason is the gap between Social Security benefits and costs of basic living for older Americans is widening quickly.


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Mark R. Hake, CFA writes articles at,,, and as well as a Beehiiv free newsletter on stocks and cryptos.

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Mark Hake is a financial analyst, investor, and Chartered Financial Analyst (CFA). He writes about US and foreign stocks as well as cryptos, hedge funds, and private equity. He previously ran his own hedge fund, investment research firm, and acted as CFO for a fintech startup. He focuses on finding value, arbitrage, and hidden asset opportunities.

Phoenix, AZ

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