For Adults 65+, Social Security and Pensions Are Key: Explore Income Shifts with New Census Tool
As people retire, income composition shifts, as shown in a new data tool that breaks down income by age group. As people age, they are more likely to depend on Social Security (Social Security) and "Other Income," including pensions, instead of wages and assets.
Forty-nine percent of those between the ages of 65 and 74 rely on social insurance income, according to a new interactive tool from the U.S. Census Bureau. The Bureau defines social insurance income as funds from Social Security, workers' compensation, and unemployment insurance programs.
The new interactive U.S. Census Bureau data tool allows users to select from hundreds of different population groups and socioeconomic characteristics and explore the make-up of the total income different groups receive.
Among those between the ages of 65 and 74, for example, only 18% rely on the earnings of their annual income, and just 7% rely on asset income. Twenty-three percent received income classified as "other," meaning it came from programs such as pensions, life insurance, disability benefits, survivor benefits, and other income, including child support and Veterans Affairs benefits.
For those 75 and older, 60% rely on their social insurance income, while only 3% rely on earnings income and 7% on asset income. Three percent of this age group depends on government transfer income, which includes Supplemental Security Income, Temporary Assistance for Needy Families, and General Assistance programs. Twenty-seven percent received other income, such as pension and other benefits.
These programs do not include noncash benefits from programs such as SNAP or WIC.
By combining income and sociodemographic information collected in the Survey of Income and Program Participants, users can gain a deeper understanding of income dynamics, according to the Bureau.
Clarifying Pension Income's Role in Retirement
While pensions are not isolated in the tool, they are included in the "Other Income" category, which also covers life insurance, disability, survivor benefits, child support, and VA benefits. This means:
- Administrators can estimate how much retirees depend on "Other Income" in later life stages—where pensions often play a more significant role.
- Trustees can contextualize pensions as a stable and critical part of this diversified retirement income mix.
Age-Based Trends Support Long-Term Strategy
The tool allows users to break down income by age group, showing how income composition shifts as people transition into retirement. This helps:
- Reinforce the importance of lifetime income streams like pensions versus more volatile sources like asset income.
- Plan benefit designs that complement Social Security and fill income gaps in later retirement years.
Advocacy Through Evidence
Even with pensions blended into "Other Income," the tool:
- Supports the narrative that public pension systems are part of a broader safety net that keeps retirees out of poverty.
- Gives trustees talking points when explaining how pensions fit into household income, especially for older adults who may rely more heavily on that category.
Insight Into Income Source Reliance
The chart also shows how income diversifies or concentrates across age groups:
- Younger adults rely more on wages, while older adults shift to Social Insurance (Social Security) and "Other Income," which includes pensions.
- This reinforces the value of having a defined benefit pension plan to stabilize retirement income as other sources dwindle.
Summary for Pension Fund Leaders:
Despite the broad "Other Income" grouping, the tool is still highly valuable:
- It provides data-backed insight into retirement income trends by age.
- It helps demonstrate why preserving and strengthening pensions is vital for older Americans' financial security.
- It supports more effective communication, planning, and advocacy aligned with fiduciary responsibility.
You can explore the tool here: Average Percentage Distribution of Income Among Adults with Any Income in 2022 (U.S. Census Bureau)
About the Author:Allen Jones is the director of communications and event marketing for TEXPERS. He joined the Association in 2017. Before TEXPERS, he worked in the news media industry, producing content for newspapers, magazines, and online publications and leading newsrooms as an editor and publications manager. [email protected]