The Growing Socio-Economic Gap in Social Security Lifetime Retirement Benefits: Current and Future Retirees

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J Gerontol B Psychol Sci Soc Sci. October 26, 2021: gbab201. doi: 10.1093 / geronb / gbab201. Online ahead of print.

ABSTRACT

OBJECTIVES: Growing socio-economic disparities, including in life expectancy, have important implications for the US social security program. This study examined inter- and intra-cohort trends in Social Security retirement benefits, paying particular attention to how the trajectories of lifetime benefits under socio-economic circumstances evolve between cohorts encompassing current and current retirees. future.

METHOD: Using a dynamic microsimulation model based on representative survey data linked to administrative records, we developed a set of cohort-specific projections that estimate the monthly and lifetime retirement benefits of the social security for retirees, from the start of the baby boom (1945-1954) to generation X. (1965-1974) cohorts.

RESULTS: We found a growing socio-economic gap in projected monthly and lifetime benefits for men and women, particularly on a lifetime basis. This divergence is associated with stagnation in benefit levels among lower SES groups associated with upward shifts among upper strata groups. Changes in distribution are linked to increasing differential mortality, but other factors are also likely to play a role, such as increasing education premiums, growing income inequality, and changes in employment and relationship backgrounds of workers. women.

DISCUSSION: Widening mortality differentials may result in distributional shifts in the US social security program. The microsimulation methodology provides insight into how the socioeconomic gap in monthly and lifetime benefit distributions may change among future older Americans against the backdrop of differential mortality and other demographic shifts. In the future, these complex models may offset some of the progressiveness built into the system.

IDPM: 34718554 | DOI: 10.1093 / geronb / gbab201


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