Social Security a key reason many seniors aren’t in poverty

Social Security marked its 90th anniversary Thursday. The milestone offers an opportune moment to write an appreciation of the enduring social insurance program.

Nearly four generations of Americans have lived with Social Security’s intergenerational promise of mutual support. Personal financial advice would be different — for the worse — without the economic security offered by Social Security.

Signed into law during the Great Depression, Social Security provided a measure of income security to retired workers. Coverage was expanded over time to self-employed workers, farm laborers and domestic workers.

The safety-net program offers critical support to people with disabilities and the families of deceased workers. Disability insurance provides crucial support to workers who can’t stay on the job for health reasons, while survivor benefits ensure widows, widowers and dependent children aren’t destitute after the death of a breadwinner.

The win with Social Security: It dramatically reduced poverty among older Americans.

Before the program was enacted, more than half of people aged 65 and older lived in poverty.

The dreaded symbol of old-age poverty was the poorhouse.

The poverty rate among older Americans now hovers around 10%.

The Census Bureau calculates that Social Security lifts roughly 16 million to 20 million Americans out of poverty each year, including older Americans, people with disabilities and survivors.

Social Security covers about 97% of older Americans who qualify. Retirement benefits are adjusted for inflation, and you can’t outlive your guaranteed income.

The programs’ political durability is another measure of success. Surveys show that public support is strong.

Solid majorities believe more money should be spent on Social Security, a view that “holds across income, educational attainment, and political affiliation,” note the authors of the report “Social Security’s First 90 Years: A History of Bipartisan and Intergenerational Support.”

Trust fund reserves will be depleted by the early 2030s, after which payroll taxes alone will cover about 77% to 80% of promised benefits. The finances of closing the funding gap are manageable in an economy totaling more than $30 trillion.