7 months ago
Social Security Nearly Meets 40% Retirement Income Goal
Social Security was created to help people when they retire by covering about 40% of the money they need to live.
A new report shows that, on average, it covers about 38% of retirees' expenses.
However, this varies a lot from state to state.
In Kansas, Social Security covers nearly 45% of expenses, which is the highest.
But in Hawaii, it only covers about 21%.
This difference is mostly because some states have higher costs for housing, healthcare, and everyday things.
Even though some states are cheaper to live in, many retirees don't move there.
They often choose places that offer the things they value, like amenities and activities, even if it costs more.
Social Security covers about 38% of retirees’ living expenses nationally, close to its original 40% goal.
In Kansas, Social Security covers 44.8% of retirement expenses, the highest among all states.
Hawaii has the lowest coverage, with Social Security paying for just 21.3% of retirement expenses.
States with lower housing and daily living costs tend to have higher coverage percentages.
Retirees often choose destinations based on amenities and lifestyle, not just cost of living.
- Who
- Retirees in the United States
- What
- Social Security benefits covering 38% of retirees’ living expenses on average
- Where
- United States, with variations by state
- When
- Current data and analysis
- Why
- To provide a stable base in retirement, originally designed to cover 40% of retirement income
Key facts
- National Coverage
- 38% of retirees’ living expenses
- Top State
- Kansas (44.8%)
- Bottom State
- Hawaii (21.3%)
- Average Annual Expenses in Kansas
- $54,961
- Average Social Security Payment in Kansas
- $24,603
- Average Annual Expenses in Hawaii
- $111,097
- Average Social Security Payment in Hawaii
- $23,634
- Top 10 States Meeting 40% Goal
- Kansas, Oklahoma, Indiana, Minnesota, Iowa, Nebraska, Alabama, Missouri, Michigan, Tennessee
Quotes
Josh Koebert
FinanceBuzz researcher
“Across the country, we found that it covers about 38% of expenses, on average.”
financialexpress.com
“Live and work in a place where you get paid a lot and can contribute a lot, and then move to a place where there’s a lower cost of retirement.”
financialexpress.com
Matthew Spiegel
Finance professor at Yale University
“Housing in rural Florida costs less than in Manhattan. But if our hypothetical retiree wants to attend Broadway shows and Knicks games regularly, the frequent flights from rural Florida to Manhattan will quickly become costly in terms of time and money. Now that rural house is not so cheap.”
financialexpress.com
Sources
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