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Why Will Poverty Decline for Social Security Beneficiaries Aged 60 and Older?

Released: August 2021
Next expected update: 2024
  • Income rises with wages, while the poverty threshold a is indexed to prices.
  • Social Security benefits, which account for a large portion of beneficiaries' income, are based on the highest 35 years of wage-indexed earnings.
  • Over time, wage growth is projected to outpace price growth, lifting beneficiaries over the poverty threshold.
Chart. Title: Poverty Rate for Beneficiaries Aged 60 and Older, 2020-2080. Line chart with tabular version below.
SOURCES: Modeling Income in the Near Term, Version 8 (MINT8) microsimulation model using 2019 Trustees Report intermediate assumptions. The 2019 Trustees Report projects tax rates will be sufficient to pay 75–80 percent of scheduled benefits after trust fund exhaustion in 2035, often referred to as payable benefits.
Show as table
Table equivalent for chart: Poverty Rate for Beneficiaries Aged 60 and Older, 2020–2080 (percent)
Year Under scheduled benefits Under payable benefits
2020 4.8 4.8
2021 4.7 4.7
2022 4.7 4.7
2023 4.6 4.6
2024 4.8 4.8
2025 4.7 4.7
2026 4.8 4.8
2027 4.8 4.8
2028 4.7 4.7
2029 4.6 4.6
2030 4.5 4.5
2031 4.5 4.5
2032 4.5 4.5
2033 4.4 4.4
2034 4.5 4.5
2035 4.5 7.4
2036 4.4 7.4
2037 4.3 7.3
2038 4.2 7.2
2039 4.3 7.3
2040 4.2 7.4
2041 4.3 7.5
2042 4.2 7.3
2043 4.3 7.5
2044 4.4 7.5
2045 4.3 7.2
2046 4.2 7.3
2047 4.0 7.0
2048 4.0 7.0
2049 4.0 7.0
2050 4.0 6.8
2051 4.0 6.8
2052 3.9 6.8
2053 4.0 6.9
2054 3.8 6.6
2055 3.8 6.6
2056 3.7 6.5
2057 3.6 6.4
2058 3.5 6.3
2059 3.4 6.1
2060 3.3 6.0
2061 3.2 5.9
2062 3.2 5.9
2063 3.0 5.7
2064 3.0 5.6
2065 3.0 5.6
2066 2.9 5.6
2067 2.8 5.4
2068 2.8 5.4
2069 2.6 5.2
2070 2.6 5.2
2071 2.5 5.1
2072 2.5 4.9
2073 2.5 4.9
2074 2.3 4.7
2075 2.3 4.7
2076 2.3 4.6
2077 2.2 4.4
2078 2.2 4.4
2079 2.1 4.2
2080 2.1 4.1
Chart. Title: Projected Changes in Wages and Poverty Thresholds, 2020-2030. Two line charts with tabular version below.
SOURCE: Based on Consumer Price Index (CPI) and Average Wage Index (AWI) assumptions from the 2019 Trustees Report.
NOTE: The AWI is used to project changes in the average wage and the wage-indexed poverty threshold while
the CPI is used for price-indexed average wage and poverty threshold projections.
Show as table
Table equivalent for chart: Projected Changes in Wages and Poverty Thresholds, 2020–2030 (in dollars)
Year Average wage Price-indexed average wage Poverty threshold Wage-indexed poverty threshold
2020 56,396 56,396 11,734 11,734
2021 58,914 58,088 11,996 12,264
2022 61,400 59,216 12,290 12,844
2023 63,919 60,908 12,605 13,456
2024 66,573 62,600 12,955 14,130
2025 69,374 64,292 13,320 14,814
2026 72,318 65,984 13,692 15,440
2027 75,397 67,676 14,075 16,070
2028 78,425 69,367 14,469 16,697
2029 81,491 71,059 14,874 17,332
2030 84,662 72,751 15,290 17,991