The Social Security Administration has announced that payments to retired and disabled beneficiaries will increase by 1.6% in 2020. This inflation adjustment is intended to offset the higher costs-of-living encountered by beneficiaries. The increase is effective for payments received in January 2020 for retirement benefits.
Social Security is a major source of income and financial security for most elderly Americans. The Social Security Administration reports that:
Nearly nine out of ten individuals age 65 and older receive Social Security benefits.
Social Security benefits represent about 33% of the income of the elderly.
Among elderly Social Security beneficiaries, 50% of married couples and 70% of unmarried persons receive 50% or more of their income from Social Security.
Among elderly Social Security beneficiaries, 21% of married couples and about 45% of unmarried persons rely on Social Security for 90% or more of their income.
In 2019 nearly 64 million Americans are receiving over one trillion dollars in Social Security benefits.
These statistics show that Social Security is a critical support for older adults. But the system is facing great stress. In 1940 the average 65-year-old had a life expectancy of 14 years. Today it is over 20. By 2035 the number of Americans age 65 and older is expected to increase from 50 million today to over 78 million.
The 1.6% increase also applies to recipients of Supplemental Security Income (SSI). Beneficiaries should receive a mail notice no later than December which will provide their benefit amount for the 2020 calendar year.