Contents

• Introduction
• Data: Health and Retirement Study (HRS)
• Income Sources for Individuals Ages 65 and Older
• Social Security
• Pensions and Retirement Savings
• Asset Income
• Earnings
• Public Assistance
• Other Income
• Income for Aged Individuals, by Marital Status
• Income for Aged Individuals, by Household Income Quintiles
• Income for Aged Individuals, by Race/Ethnicity
• Income for Aged Individuals, by Age Groups
• Income Dependency on Social Security Benefits

Summary

Congress has expressed interest in improving retirement income security for older Americans. Median household income (which lies at the middle of the household income distribution) for individuals ages 65 and older (or aged individuals) was $55,000 in 2019. However, one-fifth of individuals ages 65 and older had household incomes of less than $24,132, and one-fifth had household incomes of $116,252 or more. Household income for the married, which includes partnered households, is the sum of income from each spouse in the household; household income for single persons (i.e., those widowed, divorced or separated, and never married) is their personal income.

Older Americans receive income from public programs such as Social Security (formally known as Old-Age, Survivors, and Disability Insurance, or OASDI) and Supplemental Security Income (SSI), earnings, pensions and retirement savings, asset income, and others. This report addresses the number and proportion of aged individuals who received household income from each source and the amount received, using the 2020 Health and Retirement Study (HRS) linked with administrative data from the Social Security Administration (SSA). Income reflects the annual amount received in 2019.

Social Security was the most common source of income among the aged in 2019. Approximately 92% of individuals ages 65 and older received household income from Social Security. The median annual household Social Security benefit amount was $24,115. Social Security was the largest single-source of income among the aged, representing approximately 29.5% of aggregate income for individuals ages 65 and older in 2019. Social Security accounted for about 83% of aggregate income for aged individuals in the bottom 20% of the household income distribution, compared to 12% of aggregate income for aged individuals in the top 20% of the household income distribution.

Share of Aggregate Income from Each Source for Individuals Ages 65 and Older by Household Income Quintile, 2019

Source: CRS analysis of the 2020 Health and Retirement Study (HRS). Notes: Each household income quintile represents 20% of the individuals. The first quintile includes those with the lowest household income. The fifth quintile includes those with the highest household income. Household income quintile upper bounds are $24,132, $43,252, $68,480, and $116,252, and the fifth quintile has a lower bound of $116,253 and includes incomes up to the highest value in the data set. Pensions and retirement savings: defined benefit and defined contribution pension plans, Individual Retirement Accounts. Asset income: business income, interest, dividends, rents. Other income: veteran benefits, workers' compensation, unemployment compensation, alimony, child support, financial assistance from outside the household. Public assistance: Supplemental Security Income, other welfare income. Values have been adjusted for population weights provided by the HRS. Individual components may not sum to 100% due to rounding.

About 59% of individuals ages 65 and older received household income from pensions, annuities, and Individual Retirement Accounts (IRAs). The median household amount among recipients was $19,644. Pensions and retirement savings accounted for 24% of aggregate income for all individuals ages 65 and older, compared to 6% of aggregate income for those in the bottom 20% of the household income distribution.

About 56% of individuals ages 65 and older received household income from assets (business income, interest, dividends, rent) in 2019. The median amount was $1,332. Asset income accounted for 1% of the aggregate income of aged individuals in the bottom 20% of the household income distribution, compared with 18% among those in the top 20% of the household income distribution.

About 62% of individuals ages 65-69 received household income from earnings in 2019, compared with 26% of those ages 70 and older. The median household earnings amount among all older workers was $36,500. The percentage of aggregate income from earnings was 4% for those in the bottom 20% of the household income distribution, compared with 39% for those in the top 20% of the household income distribution.

About 8% of individuals ages 65 and older received household income from public assistance (mainly SSI) in 2019, with a median annual amount of $2,160. Public assistance accounted for approximately 6% of aggregate income for aged individuals in the bottom 20% of the household income distribution.

Introduction

Older individuals receive income from a variety of sources, including public programs such as Social Security (formally known as Old-Age, Survivors, and Disability Insurance, or OASDI) and Supplemental Security Income (SSI), as well as pensions and retirement savings, earnings, interests and dividends. Because Americans ages 65 and older (or aged individuals) represent a large and growing proportion of the U.S. population, and because much of their income is provided through government-sponsored social insurance or income transfer programs or is subsidized through income tax deductions and deferrals, the sources and amounts of income among older Americans are important in congressional policy discussions.

Americans are living longer than they were five decades ago. In 1975, the average number of years a 65-year-old American could expect to live was 14.2 years for men and 18.7 years for women. In 2025, the Social Security Board of Trustees estimated that individuals attaining age 65 in 2025 will live for an average of 19.3 years for men and 21.8 years for women.¹ As the relatively larger number of individuals born from 1946 through 1964 (or baby boomers) live into old ages, together with the aging population more generally, the age profile of the population shifts. In 2024, there were about 63.4 million Americans ages 65 and older, representing 18.5% of the population. By 2040, according to projections made by the U.S. Census Bureau, there will be 80.8 million people ages 65 and older, constituting 21.6% of the U.S. population.²

Federal expenditures for retirement income of older Americans are also a large proportion of total federal spending. In FY2025, for example, federal expenditures for Social Security³ will be approximately $1.54 trillion, representing more than 22% of total federal spending and nearly 38% of federal spending on entitlement programs.⁴ The federal government also provides income directly to low-income older Americans through the SSI program⁵ and to retired federal employees through the Civil Service Retirement System and the Federal Employees' Retirement System.⁶ In addition, the public also subsidizes the income of older Americans through several tax deferrals and deductions in the Internal Revenue Code.⁷ These tax incentives are designed to promote sponsorship of pension plans by employers and encourage workers to save for retirement. The tax deductions and deferrals granted to qualified retirement plans are one of the largest tax expenditures in the federal budget and will reduce federal tax revenues by an estimated $211 billion in FY2025.⁸

Congress may be interested in the sources and amounts of income among aged individuals, given that current and projected limitations of social insurance and retirement programs may affect retirement income security among the older population. For example, Social Security is facing a projected long-range funding shortfall.⁹ The Social Security trust funds began to decline in 2021 and the Board of Trustees project that the asset reserves will be depleted in 2034. After depletion of trust fund reserves, the program's continuing income would be sufficient to pay 81% of benefits scheduled under current law in 2034, declining to 72% of scheduled benefits in 2099.¹⁰ Moreover, Social Security provides benefits to most retirees, and many aged individuals rely on Social Security benefits for a substantial portion of their income. However, the benefit amounts for certain individuals are below the poverty line, such as some long-term low-wage earners.¹¹ In addition, Congress has expressed interest in policies affecting pensions and retirement savings as the pension landscape has changed in recent decades. In the private sector, employer-sponsored defined benefit (DB) pension plans, which guarantee retirees a lifetime stream of cash benefits, have largely been replaced by defined contribution (DC) retirement plans, such as 401(k) plans, in which retirement income is based on funds that accumulate in a worker's account.¹² However, data have shown that nearly half of private sector workers did not participate in either DB or DC retirement plans in 2023.¹³

Additionally, the sources and amounts of income for aged individuals vary substantially by demographic and socioeconomic characteristics. Understanding income disparities among aged individuals could help identify vulnerable populations and identify targeted policy options. For example, research has shown large and persistent disparities in retirement income and wealth across socioeconomic characteristics.¹⁴ Evidence also shows that Social Security and SSI accounted for a larger share of total income among lower-income individuals ages 65 and older,¹⁵ and DB pensions remain a vital resource for those who expect such income in retirement, which is about 18% of White families, 18% of Black families, and 12% of Hispanic families with heads ages 40-59 in 2019.¹⁶

This report describes household income for individuals ages 65 and older, based on data from the 2020 Health and Retirement Study (HRS) linked with administrative data from the Social Security Administration (SSA); 2020 is the most recent survey year for which the linked data were available. Analysis focuses on the sources and amounts of income received in the prior calendar year (2019) by aged individuals, the number and proportion of people receiving household income from each source, and the amounts of income they receive from each source. The report also shows how income received by aged individuals differs by marital status, age group, race/ethnicity, and household income level. Since policymakers may be interested in how the Social Security program affects the household income of the older population, this report also discusses the proportion of individuals ages 65 and older who substantially depend on Social Security income and the characteristics of those individuals.¹⁷

Data: Health and Retirement Study (HRS)

This report uses data from the 2020 HRS, reflecting income sources and amounts received in calendar year 2019.¹⁸ Administrative records from the SSA, linked to the HRS at the individual level, provide data on the receipt and amount of Social Security benefits, SSI payments, earnings, and self-employment income.

The HRS has become a leading source of data on aging in America.¹⁹ A longitudinal, nationally-representative survey of the population over age 50, the HRS core survey is conducted by the University of Michigan's Institute for Social Research (ISR) every two years through a combination of face-to-face and telephone interviews. Information is collected at both the individual and household levels on a wide-range of topics including health, health services, labor force involvement (work, earnings, retirement, disability), economic status (income sources and amounts, wealth by asset type, Social Security, pensions), family structure, and expectations. The household level data for married individuals include information from each spouse in the household. Every six years, a new six-year birth cohort is added to the HRS sample to maintain its representation of the older population. In any given wave of data collection, the HRS includes about 20,000 respondents. In total, over 43,000 respondents have participated in the HRS since its inception in 1992. This report utilized the so-called RAND HRS data files, which are a series of publicly-available, user-friendly HRS data files produced by RAND to improve the ease-of-use of the HRS and to promote the quality and consistency of the HRS data through standardized naming conventions, definitions, and documentation across HRS waves.²⁰

HRS respondents are asked to provide written consent to authorize SSA to release Social Security and SSI benefits and earnings records to ISR for research purposes. Across all waves of the HRS, roughly 70% of respondents have provided such consents. The linked HRS-SSA data may be accessed by authorized researchers with approved research projects, subject to a number of constraints and disclosure protections proscribed by ISR.²¹ The combination of the richness of the HRS survey data with the details of SSA's benefits and earnings records is beneficial for a wide variety of research applications, including analysis of the income of the population 65 or older.²²

In the sample of 2020 HRS respondents age 65 or older, this report used SSA administrative data on Social Security and SSI benefits and earnings and self-employment income in place of HRS survey reported measures for respondents who authorized their records to be released to ISR. If administrative records were not available (generally for respondents who did not authorize SSA to release their records to ISR), this study used the survey reported measures. Roughly 77.4% of respondents in this study had linked SSA administrative records on Social Security benefits, 7.1% had linked records on SSI benefits, and 32.6% had linked records for earnings or self-employment income. The HRS survey data provide all other income measures. Population weights provided by the HRS are applied to all reported estimates.²³

This report defines age and other demographic variables (gender, race/ethnicity, marital status) as of the survey date. Income measures pertain to one year before the survey year (i.e., 2019). Household income for married individuals is the sum of income from each spouse in the household,²⁴ and for single persons (e.g., those widowed, divorced or separated, and never married) is that individual's personal income. The income used in this report is pre-tax income (before income and payroll taxes), and is as reported below:

• Social Security includes income from the Old Age, Survivors, and Disability Insurance (OASDI) program;²⁵
• Earnings include wage and salary earnings plus self-employment income;
• Pensions and retirement savings include income from DB pension plans, annuities, and distributions from DC retirement accounts and Individual Retirement Accounts (IRAs);²⁶
• Asset income includes business income, interest, dividends, and rents;
• Public assistance includes SSI benefits, dollars worth of Supplemental Nutrition Assistance Program (SNAP) benefits,²⁷ and other welfare income; and
• Other income includes veterans' benefits, workers' compensation, unemployment compensation, alimony, child support, and financial assistance from friends or relatives not living in the same household.

Income Sources for Individuals Ages 65 and Older

The population ages 65 and older receive their income from Social Security, pensions and retirement savings, earnings, asset income, public assistance, and other sources.³² In 2019, nearly 81% of aggregate income of aged individuals came from Social Security, earnings, and pensions and retirement savings. Social Security was the largest single source of income among the aged, accounting for 29.5% of aggregate income, while earnings accounted for 27.3%, and pensions and retirement savings constituted 23.8% of income. The remaining 19% of aggregate income included income from assets, public assistance, and other sources (see Figure 1).

Figure 1. Share of Aggregate Income from Each Source Among Individuals Ages 65 and Older, 2019

Source: CRS analysis of data from the 2020 Health and Retirement Study (HRS). Notes: Pensions and retirement savings include pension income from employer-sponsored defined benefit and defined contribution plans, annuities, and withdrawals from Individual Retirement Accounts. Asset income includes business income, interest, dividends, and rents. Other income includes veteran benefits, workers' compensation, unemployment compensation, alimony, child support, and financial assistance from friends or relatives not living in the same household. Public assistance includes Supplemental Security Income benefits, dollars worth of Supplemental Nutrition Assistance Program benefits, and other welfare income. All values displayed in the table have been adjusted for population weights provided by the HRS. The sum of the components may not equal 100% due to rounding.

Table 2 displays the share of individuals ages 65 and older who received household income from each income source in 2019. Among aged individuals with each type of income, the figure also shows the median income amount for households who received that type of income. Detailed information regarding the distribution of household income for each income source is shown in Table A-1.

Social Security

Social Security provides monthly cash benefits to insured retired or disabled workers, their family members, and certain family members of deceased workers.³³ Workers become insured for Social Security benefits for themselves and their family members by working in Social Security-covered employment and by making payroll tax contributions on those earnings.³⁴ Among other requirements, a worker generally needs 40 earnings credits (10 years of covered employment) to be eligible for a Social Security retired-worker benefit.³⁵ The Social Security full retirement age (FRA) is the age at which workers can first claim full Social Security retired-worker benefits. The FRA ranges between 65 and 67, depending on year of birth. Workers can claim Social Security retired-worker benefits as early as age 62, the early eligibility age (EEA). However, workers who claim benefits before the FRA are generally subject to a permanent reduction in their benefits.³⁶ Spouses can also claim reduced spousal benefits based on the worker's earnings as early as age 62.³⁷ Social Security benefits for a household can include those for retired workers, disabled workers,³⁸ dependent spouses, and survivors.³⁹

Social Security benefits generally increase with career-average earnings. This means that low-paid workers receive relatively lower benefits than high-paid workers. The Social Security benefit formula, however, is progressive—it is weighted to replace a greater share of career-average earnings for low-paid workers than for high-paid workers, who were expected to be able to save more individually than lower-paid workers. Therefore, low-paid workers receive relatively higher benefits relative to their career-average earnings and payroll tax contributions.

In 2019, Social Security benefits were the most common source of income among individuals ages 65 and older. Most individuals ages 65 and older received household income from Social Security (91.9%).⁴⁰ For individuals whose households had Social Security beneficiaries, the median household benefit amount was $24,115. Most aged individuals (about 80%) received household Social Security benefits between $10,440 and $41,710; about 10% of aged individuals received household benefits less than $10,440, and about 10% received household benefits in excess of $41,710.⁴¹

Pensions and Retirement Savings

Pensions and retirement savings include pension income from employer-sponsored DB and DC plans, annuities, and withdrawals from IRAs.⁴² In 2019, about 58.7% of individuals ages 65 and older received household income from pensions and retirement savings, with a median household amount of $19,644 among those with these types of income. Household income from pensions and retirement savings varied substantially across the aged population. Among aged individuals who received household income from pensions and retirement savings, about 35% received less than $10,000, while about 25% received more than $40,000.⁴³

In 2019, the largest component in pensions and retirement savings was income from employer-sponsored DB and DC pensions. DB plans usually offer a lifetime annuity (i.e., periodic payments throughout retirement) that is typically based on a combination of factors, such as an employee's tenure, salary, and an accrual rate.⁴⁴ DC plans, such as 401(k) plans, are retirement savings accounts generally funded through voluntary pre-tax contributions by the worker, which are sometimes partially or fully matched by the employer.⁴⁵ The employee determines how much to invest and how to allocate these funds among the investment options. Retired households can generally withdraw funds out of these accounts as a source of income, but face decisions regarding the timing, rate, and form of withdrawal.⁴⁶ In 2019, about 43.8% of individuals ages 65 and older received household income from DB or DC pensions; the median household amount was $17,832 (see Table A-1).

A relatively small share of aged individuals (7.6%) received household income from non-pension annuities in 2019. Annuities may take different forms.⁴⁷ Annuities can be used to reduce the likelihood that people may outlive their resources and to alleviate some post-retirement investment risks. Among aged individuals who received household income from non-pension annuities in 2019, the median amount was $10,152 (see Table A-1).

Retirement income can also include distributions from IRAs.⁴⁸ Individuals who have earned income (e.g., wages, salaries, commissions, self-employment income) can establish IRAs to accumulate funds for retirement on a tax-advantaged basis.⁴⁹ Though many individuals contribute directly to an IRA, the majority of IRA funds come from rollovers of DC plan assets.⁵⁰ In 2019, about 28.7% of aged individuals received household income from withdrawals from IRA accounts. The median household withdrawal was $8,945 among those aged individuals with this type of income (see Table A-1).

Asset Income

Asset income includes capital income from business, rent, interest, and dividends. Asset income is relatively common among individuals ages 65 and older. In 2019, approximately 55.7% of aged individuals received household income from assets; the median household amount was $1,332. Most received small amounts of such income. Roughly 25% of aged individuals who had household income from assets received less than $72 and nearly 75% received less than $12,600.⁵¹

Earnings

Earnings include income from wages and salaries and self-employment. Older individuals generally leave the labor force or reduce working hours when they age. In 2019, about 37.5% of individuals ages 65 and older had household income from earnings. Most of those aged workers (82%) were between ages 65 and 74. Among individuals with workers in their households, the median household earnings amount was $36,500 (the largest median amount for any of the income sources). The household earnings amount was less than $10,000 for one-fourth of aged individuals with household earnings, and it was more than $84,000 for another one-fourth of those individuals.

A larger share of aged individuals received income from wages and salaries (31.8%) than from self-employment (13.2%) in 2019. The median household income amount from wages and salaries was $35,300 among aged individuals who received household income from those income sources, compared with $18,800 for household self-employment income (see Table A-1).

Public Assistance

Public assistance includes SSI and other public assistance (e.g., welfare and dollars worth of SNAP).⁵² In 2019, 7.6% of aged individuals received household income from public assistance, and their median annual household benefit amount was $2,160. The household public assistance amount was less than $10,000 for most aged individuals.⁵³

SSI is a needs-based federal assistance program that provides monthly cash benefits to aged, blind, and disabled individuals who have income and assets within prescribed program limits. The program is intended to provide a guaranteed minimum level of income to adults who have difficulty meeting their basic living expenses due to age (65 and older) or disability, and who have little or no Social Security or other income.⁵⁴ The proportion of the elderly population receiving SSI has steadily fallen since the program began in 1974,⁵⁵ mainly because the percentage of people ages 65 and older who received Social Security benefits has increased and the value of Social Security benefits—which reduces the value of one's SSI payment on a dollar-for-dollar basis after a $20 general income exclusion—has risen due to the growth in real wages. The SSI federal benefit rate, in contrast, grows at the annual rate of price inflation.⁵⁶ In 2019, about 3.4% of individuals ages 65 and older received SSI benefits in household income; the median annual benefit amount was $4,758 among SSI recipients (see Table A-1). About 74% of aged individuals who received household income from SSI were in the bottom 20% of the household income distribution, and more than half were in poverty.⁵⁷

Roughly 5.7% of aged individuals received household income from SNAP and other welfare programs in 2019; the median household amount was $1,200 (see Table A-1).

Other Income

Individuals ages 65 and older may also receive household income from veteran benefits, workers' compensation, unemployment compensation, alimony, child support, and financial assistance from friends or relatives not living in the same household. In 2019, about 16.8% of aged individuals received household income from other sources; the median household amount among those individuals was $14,736.

Income for Aged Individuals, by Marital Status

In 2020 (the survey year), about 62.6% of individuals ages 65 and older were married, 19.6% were widowed, 12.1% were divorced or separated, and 5.4% were never married.⁵⁸

In general, aged individuals who were married tend to have a higher median household income than single individuals (those widowed, divorced or separated, and never married), since a married individual might have household income from more than one person. In 2019, the median household income for married individuals age 65 or older was $75,390, compared with $28,081 for widow(er)s, $28,248 for divorced or separated individuals, and $27,340 for never married individuals (see Figure 2).

Figure 2. Median Household Income for Individuals Ages 65 and Older by Marital Status, 2019

Source: CRS analysis of data from the 2020 Health and Retirement Study (HRS). Notes: Married individuals include those married or partnered. Divorced individuals include those divorced and separated. Household income for married and partnered individuals is the sum of income from each spouse or partner in the household. The sample in this figure includes a small share of individuals ages 65 and older (about 0.3%) who did not receive household income in 2019. All values displayed in the figure have been adjusted for population weights provided by the HRS.

Figure 3 shows the share of individuals ages 65 and older who received household income from each income source, based on their marital status in 2019. The receipt of Social Security in household income was generally common among both married individuals and single persons.

A larger percentage of married individuals ages 65 and older received household income from pensions and retirement savings and asset income than single persons. About 64.2% of married individuals received household income from pensions and retirement savings, compared with 53.4% for widowed individuals, 45.4% for those divorced or separated, and 45.1% for those never married. Similarly, around 62.7% of married individuals ages 65 and older received asset income in household income, compared with 47.9% for widow(er)s, 38.3% for divorced or separated individuals, and 43.7% for never married individuals.

Aged individuals who were married were also more likely to receive household income from earnings than single persons. About 46.1% of married individuals ages 65 and older received household income from earnings, compared to 15.0% for widow(er)s, 34.5% for those divorced or separated, and 26.3% for those never married. Aged widow(er)s were least likely to work, partly because about half of them were age 80 or older and had left the labor force.

In contrast, a larger percentage of single persons received household income from SSI or other public assistance than married individuals. About 17.9% of never married individuals ages 65 and older received household income from public assistance, compared with 15.2% for those divorced or separated, 10.6% for widow(er)s, and 4.2% for those married.

Figure 3. Share of Individuals Ages 65 and Older That Received Household Income from Each Income Source by Marital Status, 2019

Source: CRS analysis of data from the 2020 Health and Retirement Study (HRS). Notes: Married individuals include those married or partnered. Divorced individuals include those divorced and separated. Pensions and retirement savings include pension income from employer-sponsored defined benefit and defined contribution plans, annuities, and withdrawals from Individual Retirement Accounts. Asset income includes business income, interest, dividends, and rents. Other income includes veteran benefits, workers' compensation, unemployment compensation, alimony, child support, and financial assistance from friends or relatives not living in the same household. Public assistance includes Supplemental Security Income benefits, dollars worth of Supplemental Nutrition Assistance Program benefits, and other welfare income. All values displayed in the table have been adjusted for population weights provided by the HRS.

Figure 4 displays the share of aggregate income from each income source for individuals ages 65 and older by marital status in 2019. Social Security benefits accounted for a larger proportion of total income for aged single persons than for married individuals. Social Security benefits accounted for 38.8% of total income for widow(er)s, 32.1% for divorced or separated individuals, and 32.2% for never married individuals, compared with 26.5% for married individuals. The proportions of total income from pensions and retirement savings, asset income, and public assistance were also higher for aged single persons than for married individuals, respectively.

Differently, earnings accounted for a larger proportion of total income for aged individuals who were married than for aged single persons. This is partly because married individuals were more likely to receive household income from earnings and the median earnings were usually higher than the median of other income sources.

Figure 4. Share of Aggregate Income from Each Income Source Among Individuals Ages 65 and Older by Marital Status, 2019

Source: CRS analysis of data from the 2020 Health and Retirement Study (HRS). Notes: Married individuals include those married or partnered. Divorced individuals include those divorced and separated. Pensions and retirement savings include pension income from employer-sponsored defined benefit and defined contribution plans, annuities, and withdrawals from Individual Retirement Accounts. Asset income includes business income, interest, dividends, and rents. Other income includes veteran benefits, workers' compensation, unemployment compensation, alimony, child support, and financial assistance from friends or relatives not living in the same household. Public assistance includes Supplemental Security Income benefits, dollars worth of Supplemental Nutrition Assistance Program benefits, and other welfare income. All values displayed in the table have been adjusted for population weights provided by the HRS. Individual components may not sum to 100% due to rounding.

Income for Aged Individuals, by Household Income Quintiles

The sources of income received by individuals 65 and older whose household incomes are at the lower end of the household income distribution differ from the sources of income of people at the upper end of the household income distribution. Figure 5 shows the share of aged individuals who received household income from different income sources by household income quintile in 2019. Each quintile represents 20% of the aged population. The first quintile depicts the 20% of aged individuals with the least household income, and the fifth quintile depicts the 20% of aged individuals with the most household income. In 2019, receipt of Social Security in household income was generally common among aged individuals throughout the household income distribution, while receipt of other income sources generally differed across the household income distribution.

A smaller percentage of aged individuals with relatively lower household income received pensions and retirement savings in 2019 compared with those with higher household income. About 18.9% of aged individuals in the bottom household income quintile received household income from pensions and retirement savings, compared to 53.7% of those in the 2^nd household income quintile, and more than 69% of those in each of the top three household income quintiles (Figure 5). The finding that aged individuals with lower household income were less likely to receive income from pensions and retirement savings might be due to lower labor force participation during their working years, less income available for savings, or lower access to pension plans.

Earnings were also less prevalent among aged individuals with relatively lower household income in 2019. About 10.5% of aged individuals in the bottom household income quintile received household income from earnings, compared with almost 68.8% of those in the top household income quintile (Figure 5). This is partly because aged individuals with the most household income were relatively younger and still remained in the labor force. Approximately 74.2% of aged individuals in the top household income quintile were ages 74 and younger, compared with 49.7% of those in the bottom household income quintile.

In addition, Figure 5 shows that aged individuals at the lower end of the household income distribution were also less likely to receive household income from assets and other sources. For example, in 2019, nearly 20.6% of aged individuals in the bottom household income quintile received household income from assets, compared with about 82.5% among those in the top household income quintile. About 4.1% of aged individuals in the bottom quintile of the household income distribution received some other income, compared with more than 26.5% among those in the top household income quintile.

Differently, aged individuals who were in the bottom household income quintile were more likely to receive household income from public assistance. In 2019, Figure 5 shows that about 26.2% of aged individuals in the bottom quintile of the household income distribution received SSI or other public assistance, compared with less than 6% for aged individuals with higher household income.

For the percentage of aged individuals who received household income from detailed income sources by household income quintile and marital status, see Table A-2.

Figure 5. Share of Individuals Ages 65 and Older That Received Household Income from Selected Source by Household Income Quintile, 2019

Source: CRS analysis of data from the 2020 Health and Retirement Study (HRS). Notes: Pensions and retirement savings include pension income from employer-sponsored defined benefit and defined contribution plans, annuities, and withdrawals from Individual Retirement Accounts. Asset income includes business income, interest, dividends, and rents. Other income includes veteran benefits, workers' compensation, unemployment compensation, alimony, child support, and financial assistance from friends or relatives not living in the same household. Public assistance includes Supplemental Security Income, dollars worth of Supplemental Nutrition Assistance Program benefits, and other welfare income. Household income quintile upper bounds are $24,132, $43,252, $68,480, and $116,252, and the fifth quintile has a lower bound of $116,253 and includes incomes up to the highest value in the data set. All values displayed in the table have been adjusted for population weights provided by the HRS. For information on detailed income sources, see Table A-2.

Figure 6 displays the share of aggregate income among aged individuals from each income source by household income quintile in 2019. Social Security was the predominant income source for aged individuals with relatively lower household income. For example, Social Security provided 82.6% of all income received in 2019 for those in the bottom household income quintile, and 63.5% for those in the second household income quintile. The share of aggregate income from Social Security significantly decreased as household income increased. Social Security paid 12.0% of all income received for aged individuals in the top household income quintile.

Except for those with the least household income, who received 5.6% of aggregate income from this source, in 2019, pensions and retirement savings provided between 18% and 32% of aggregate income for aged individuals (Figure 6). This income source accounted for about 30% of aggregate income for those in the 3^rd and 4^th household income quintile, and less than 25% for those with the most household income. Aged individuals in the top household income quintile received a relatively smaller percentage of aggregate income from pensions and retirement savings partly because they also received more than half of aggregate income from asset income and earnings. Aged individuals in the bottom household income quintile received a smaller percentage of aggregate income from pensions and retirement savings mainly because a smaller percentage of those individuals received household income from those sources.

Differently, asset income and earnings accounted for a substantially larger share of total income for individuals ages 65 and older who had higher household income than those with lower household income. For example, Figure 6 shows that asset income accounted for 17.6% of total income for aged individuals in the top household income quintile, compared with 1.2% for those in the bottom household income quintile; earnings accounted for 38.9% of total income received by aged individuals in the top household income quintile, compared with 3.8% for those in the bottom household income quintile.

Public assistance accounted for a small percentage of aggregate income for most aged individuals, although it was somewhat more important for aged individuals in the bottom household income quintile, accounting for 5.6% of aggregate income (Figure 6).

For the share of aggregate income from detailed income sources by household income quintile and marital status, see Table A-3.

Figure 6. Share of Aggregate Income from Each Source Among Individuals Ages 65 and Older by Household Income Quintile, 2019

Source: CRS analysis of data from the 2020 Health and Retirement Study (HRS). Notes: Pensions and retirement savings include pension income from employer-sponsored defined benefit and defined contribution plans, annuities, and withdrawals from Individual Retirement Accounts. Asset income includes business income, interest, dividends, and rents. Other income includes veteran benefits, workers' compensation, unemployment compensation, alimony, child support, and financial assistance from friends or relatives not living in the same household. Public assistance includes Supplemental Security Income, dollars worth of Supplemental Nutrition Assistance Program benefits, and other welfare income. Household income quintile upper bounds are $24,132, $43,252, $68,480, and $116,252, and the fifth quintile has a lower bound of $116,253 and includes incomes up to the highest value in the data set. All values displayed in the table have been adjusted for population weights provided by the HRS. Individual components may not sum to 100% due to rounding. For information on detailed income sources, see Table A-3.

Income for Aged Individuals, by Race/Ethnicity

In 2020, 78.7% of aged individuals identified as non-Hispanic White, 9.3% identified as non-Hispanic Black, 9.0% identified as Hispanic of any race, and 3.1% identified as non-Hispanic of other races.⁵⁹ Figure 7 shows the median household income in 2019 for individuals ages 65 and older by race/ethnicity. Median household income in 2019 was highest among aged individuals who identified as non-Hispanic White ($62,245) and lowest among aged individuals who identified as Hispanic ($24,960).

Figure 7. Median Household Income for Individuals Ages 65 and Older by Race/Ethnicity, 2019

Source: CRS analysis of data from the 2020 Health and Retirement Study (HRS). Notes: Respondents in the White, Black and Other groups are non-Hispanic. Household income for married and partnered individuals is the sum of income from each spouse in the household. All values displayed in the table have been adjusted for population weights provided by the HRS.

Figure 8 shows the sources of household income in 2019 for individuals ages 65 and older by race/ethnicity. Social Security income was the most common source across all racial and ethnic groups. Receipt of Social Security income in 2019 ranged between 88.3% and 92.5% across different race/ethnicity groups.

Pensions and retirement savings and asset income were the next most common income sources in 2019 among individuals age 65 or older. While about two-thirds (65.0%) of those who identified as non-Hispanic White had income from pensions and retirement savings and 64.0% had asset income, the respective percentages for those who identified as Hispanic were 28.1% and 17.6% (Figure 8). Slightly more than one-third (38.3%) of those who identified as non-Hispanic Black had income from pensions and retirement savings in 2019 and one-quarter (25.0%) had asset income.

Between 32.2% and 38.6% of aged individuals had earnings in 2019, with earnings being most common among those who identified as non-Hispanic White and non-Hispanic of other races, and least common among those who identified as Hispanic (Figure 8).

Although receipt of public assistance in 2019 among individuals ages 65 and older was less common (7.6%, see Table 2) than receipt of other income sources, the overall rate of receipt was depressed by low receipt among those who identified as non-Hispanic White. Nearly one-fifth (19.5%) of those who identified as Hispanic received public assistance. About 18.5% of those who identified as non-Hispanic Black received public assistance income (Figure 8).

Up to roughly one-fifth of aged individuals received income from other sources in 2019, including veterans' benefits, unemployment insurance, and workers compensation. Receipt of other income was substantially less common among those who identified as Hispanic and non-Hispanic Black compared with those who identified as non-Hispanic White and non-Hispanic of other races.

For the percentage of aged individuals who received household income from detailed income sources by race and ethnicity and marital status, see Table A-4.

Figure 8. Share of Individuals Ages 65 and Older That Received Household Income from Each Income Source by Race/Ethnicity, 2019

Source: CRS analysis of data from the 2020 Health and Retirement Study (HRS). Notes: Respondents in the White, Black and Other groups are non-Hispanic. Pensions and retirement savings include pension income from employer-sponsored defined benefit and defined contribution plans, annuities, and withdrawals from Individual Retirement Accounts. Asset income includes business income, interest, dividends, and rents. Other income includes veteran benefits, workers' compensation, unemployment compensation, alimony, child support, and financial assistance from friends or relatives not living in the same household. Public assistance includes Supplemental Security Income, dollars worth of Supplemental Nutrition Assistance Program benefits, and other welfare income. All values displayed in the table have been adjusted for population weights provided by the HRS. For information on detailed income sources, see Table A-4.

Figure 9 shows the share of aggregate income in 2019 from each source among individuals ages 65 and older by race and ethnicity. Following the patterns of receipt described above, Social Security income accounted for the largest share of aggregate income in 2019 across most race and ethnicity groups among aged individuals. Particularly among those who identified as Hispanic and those who identified as non-Hispanic Black, Social Security accounted for a large proportion of household income in 2019 (44.0% and 40.5%, respectively).

Figure 9 shows that, taken together, pensions and retirement savings and asset income accounted for between 18% and 24% of aggregate household income in 2019 for aged individuals who identified as Hispanic or non-Hispanic Black. In contrast, pensions and retirement savings and asset income accounted for more than 34% of aggregate household income in 2019 for those who identified as non-Hispanic White and non-Hispanic of other races.

Earnings accounted for 25%-30% of aggregate household income in 2019 across race and ethnicity groups in 2017 (Figure 9).

Public assistance and other income sources accounted for comparatively smaller shares of household income in 2019. Despite the relatively larger proportions of those who identified as Hispanic and non-Hispanic Black who received public assistance in 2019 (Figure 8), income from public assistance programs accounted for a relatively small share of aggregate household income in 2019 (less than 3%, Figure 9).

For the share of aggregate income from detailed income sources by race and ethnicity and marital status, see Table A-5.

Figure 9. Share of Aggregate Income from Each Income Source Among Individuals Ages 65 and Older by Race/Ethnicity, 2019

Source: CRS analysis of data from the 2020 Health and Retirement Study (HRS). Notes: Respondents in the White, Black and Other groups are non-Hispanic. Pensions and retirement savings include pension income from employer-sponsored defined benefit and defined contribution plans, annuities, and withdrawals from Individual Retirement Accounts. Asset income includes business income, interest, dividends, and rents. Other income includes veteran benefits, workers' compensation, unemployment compensation, alimony, child support, and financial assistance from friends or relatives not living in the same household. Public assistance includes Supplemental Security Income, dollars worth of Supplemental Nutrition Assistance Program benefits, and other welfare income. All values displayed in the table have been adjusted for population weights provided by the HRS. Individual components may not sum to 100% due to rounding. For information on detailed income sources, see Table A-5.

Income for Aged Individuals, by Age Groups

In 2020, about 32.1% of aged individuals were 65-69 years old, 27.1% were ages 70-74, 18.2% were ages 75-79, and 22.6% were age 80 or older. Median household income in 2019 declined with age, from $66,564 among those ages 65-69 to $38,277 among those ages 80 and older (Figure 10).

Figure 10. Median Household Income for Individuals Ages 65 and Older by Age Group, 2019

Source: CRS Analysis of data from the 2020 Health and Retirement Study (HRS). Notes: Household income for married individuals is the sum of income from each spouse in the household. All values displayed in the table have been adjusted for population weights provided by the HRS.

Figure 11 shows the share of individuals ages 65 and older who received household income in 2019 from each income source by age group. Across all age groups, Social Security was the most common income source in 2019. Among all individuals, between 79% and 98% received household income from Social Security in 2019. The lowest percentage occurred for the 65-69 age group. Some individuals in this age group may have been transitioning from the labor force to retirement, and may not yet have applied for Social Security benefits due to the increase in the FRA, as evidenced by the large proportion with earnings (61.6%). Aged individuals with short working histories may not qualify for Social Security and may qualify for SSI or other public assistance.

Pensions and retirement savings and asset income were the next most common income sources in 2019. There was little variation across the older age groups in the percentage who received these income sources (Figure 11). However, a somewhat smaller proportion of the youngest age group (ages 65-69) received income from pensions, retirement savings, and assets in 2019, again in part because a larger proportion were still working. The percentage of older individuals with household income from earnings in 2019 declined rapidly with age, from 61.6% of those ages 65-69 to 10.6% of those age 80 or older.

Between 6% and 9% of individuals ages 65 and older received household income from public assistance programs in 2019, with relatively little variation across age groups (Figure 11). Finally, Figure 11 shows that roughly 14% to 20% of all individuals received household income from other sources in 2019, such as veterans' benefits, unemployment insurance, and workers compensation. Such income, which to some extent may be tied to recent former employment, was received less frequently among individuals ages 75-79 and 80 and older.

Figure 11. Share of Individuals Ages 65 and Older That Received Household Income from Each Income Source by Age Group, 2019

Source: CRS analysis of data from the 2020 Health and Retirement Study (HRS). Notes: Pensions and retirement savings include pension income from employer-sponsored defined benefit and defined contribution plans, annuities, and withdrawals from Individual Retirement Accounts. Asset income includes business income, interest, dividends, and rents. Other income includes veteran benefits, workers' compensation, unemployment compensation, alimony, child support, and financial assistance from friends or relatives not living in the same household. Public assistance includes Supplemental Security Income, dollars worth of Supplemental Nutrition Assistance Program benefits, and other welfare income. All values displayed in the table have been adjusted for population weights provided by the HRS.

Figure 12 shows the share of aggregate income in 2019 from each source among individuals ages 65 and older by age group. A larger share of aggregate income in 2019 for individuals ages 65-69 came from earnings, whereas the older age groups received larger shares of aggregate income from retirement sources such as Social Security, pensions and retirement savings, and asset income. For individuals ages 65-69, roughly one-fifth (19.1%) of aggregate income in 2019 was from Social Security, nearly one-sixth (16.4%) was from pensions and retirement savings, just under one-tenth (8.8%) was from asset income, and about half (49.0%) was from earnings. Conversely, for individuals ages 80 and older, over one-third (40.0%) of aggregate income in 2019 was from Social Security, over one-quarter (28.6%) was from pensions and retirement savings, about one-fifth (19.5%) was from asset income, and 5.4% was from earnings. For all age groups, the share of aggregate income from public assistance programs in 2019 was small (less than 1%).

Figure 12. Share of Aggregate Income from Each Income Source Among Individuals Ages 65 and Older by Age Group, 2019

Source: CRS analysis of data from the 2020 Health and Retirement Study (HRS). Notes: Pensions and retirement savings include pension income from employer-sponsored defined benefit and defined contribution plans, annuities, and withdrawals from Individual Retirement Accounts. Asset income includes business income, interest, dividends, and rents. Other income includes veteran benefits, workers' compensation, unemployment compensation, alimony, child support, and financial assistance from friends or relatives not living in the same household. Public assistance includes Supplemental Security Income, dollars worth of Supplemental Nutrition Assistance Program benefits, and other welfare income. All values displayed in the table have been adjusted for population weights provided by the HRS. Individual components may not sum to 100% due to rounding.

Income Dependency on Social Security Benefits

As noted previously, Social Security was the most common source of income and also the largest source of income among the population ages 65 and older in 2019. Social Security income was particularly important for older individuals (ages 75 and older), aged individuals with lower household income, and aged individuals who identify as Hispanic and non-Hispanic Black. Figure 13 measures reliance on Social Security income in 2019 among individuals ages 65 and older, presenting the proportion of individuals in aged households with Social Security income that received 50% or more, 75% or more, and 90% or more of household income from Social Security. The figures are disaggregated by age group, educational attainment, household income quintile, marital status, poverty status, race/ethnicity, and gender.⁶⁰

Among aged individuals who received household income from Social Security in 2019, about half (49.5%) received more than 50% their household income from Social Security, and nearly one-fifth (18.7%) received more than 90% of their household income from Social Security (Figure 13). Other studies using survey data from the Current Population Survey linked with SSA administrative records and Internal Revenue Service tax records found that 12%-14% of individuals age 65 or older received 90% or more of household income from Social Security in 2015 and 2012.⁶¹

Figure 13 shows that reliance on Social Security income in 2019 increased across age groups. About 13.9% of those ages 65-69 relied on Social Security for 90% or more of household income in 2019, compared with 16.7% for those ages 70-74, 18.2% for those ages 75-59, and 26.9% for those ages 80 and older. This pattern may stem at least in part from the lifetime nature of Social Security benefits, and also highlights the importance of Social Security spouse and survivor benefits, particularly for older women.⁶² The estimates show that 20.7% of women relied on Social Security for 90% or more of household income in 2019. For widowed, divorced, and never married individuals, reliance on Social Security for 90% or more of household income in 2019 was 30.4%, 27.1%, and 28.0%, respectively.

Aged individuals with less education had greater reliance on Social Security income in 2019. About 45.3% of those with less than a high school diploma and 21.5% of those with a high school diploma but no college education relied on Social Security for 90% or more of household income in 2019, compared with 7.5% of those with at least a bachelor's degree (Figure 13). The estimates based on household income quintile show that 61.5% of aged individuals in the bottom 20% of the household income distribution rely on Social Security for 90% or more of household income in 2019, compared with almost none of those in the top two household income quintiles. Similarly, 58.0% of aged individuals with household income below the poverty threshold relied on Social Security for 90% or more of household income in 2019.

About 38.5% of those who identified as Hispanic and 30.7% of those who identified as Black non-Hispanic received more than 90% of their household income from Social Security in 2019, compared with 14.9% of those who identified as White non-Hispanic and 23.5% of those who identified as non-Hispanic of other races (Figure 13).

Figure 13. Percentage of Individuals Ages 65 and Older by Selected Proportion of Household Income from Social Security Benefits, 2019

Source: CRS analysis of data from the 2020 Health and Retirement Study (HRS). Notes: Statistics are among individuals 65 and older who had Social Security benefits in household income. Demographic characteristics are based on the time of the survey. Income is based on amounts received in the previous calendar year (2019). Married individuals include those married or partnered. Divorced individuals include those divorced and separated. HS refers to High School. Poverty status is determined based on the definition by U.S. Census Bureau (see footnote 57). Respondents in the White, Black, and Other groups are non-Hispanic. Household income quintile upper bounds are $24,132, $43,252, $68,480, and $116,252, and the fifth quintile has a lower bound of $116,253 and includes incomes up to the highest value in the data set. All values displayed in the table have been adjusted for population weights provided by the HRS.

Appendix. Additional Income Tables for Individuals Ages 65 and Older

CRS Research Assistant Joe Angert contributed to the data analysis in this report.

Footnotes