Social Security was signed into law by President Franklin Roosevelt 80 years ago. The pay as you go system has proven to be an efficient, secure system that supports Americans facing challenges with disability, retirement, and death. Today 59 million Americans receive a guaranteed monthly replacement of wages.
Social Security is neutral in terms of race and ethnicity, meaning that it looks at how much an individual has paid into the system to determine benefits. But the program does have more of an impact in some communities than others. Let’s take a look at what Social Security means for African Americans and Latinos:
- Lower wage earners receive a higher percentage benefit than high wage earners, so African Americans receive more income back in relation to previous earnings than do workers who earned more. In 2013, African Americans who worked full-time had a median earnings of $36,000 compared to $43,000 for all working age people.
- The average annual Social Security income received by African American men 65 years and older was $14,800, compared to $12,540 for African American women in 2013.
- In 2013, among African Americans receiving Social Security, 25 percent of elderly married couples and 55 percent of unmarried elderly persons relied on Social Security for 90 percent or more of their income.
- African Americans are more likely to die or become disabled before retirement so Social Security becomes important for African-American children as they are more likely to receive benefits than children of other races.
- For Latinos, those who are lower wage earners end up receiving more income back in relation to higher earning people. The median earnings of working-age Latinos who worked full-time, year-round were about $30,000 compared to $43,000 for all working-age people in 2013.
- The average annual Social Security income received by Latino men 65 years and older was $14,148, and for women it was $10,931 in 2013.
- Latinos tend to have higher life expectancies than other groups at age 65 and above, so elderly Latinos will live more years in retirement and benefit from Social Security’s cost-of-living protections.
- Among Latinos receiving Social Security, 37 percent of elderly married couples and 62 percent of elderly unmarried persons relied on Social Security for 90 percent or more of their income in 2013.