Authors: Teresa Ghilarducci, Siavash Radpour, and Anthony Webb
Highlights from ReLab's policy note include:
- Social Security reduces - but does not eliminate - retirement wealth inequality.
- For typical workers age 51-56, accrued Social Security benefits exceed employer-sponsored
retirement wealth. Median Social Security wealth amounts to $81,900 compared with $67,000 in
employer-sponsored retirement plans.
- At ages 51-56, the typical low-wage worker (in the lowest 20% of earnings) has no retirement
wealth. The typical high-wage worker (in the highest 20% of earnings) has wealth equal to almost
two and a half times their earnings.
- Adding accrued Social Security benefits to retirement wealth decreases the retirement wealth gap
between low and high earners from two and a half times earnings to just over half a year’s earnings.
While adding accrued Social Security benefits to retirement wealth decreases the retirement wealth gap between low and high earners and keeps retirees out of poverty, American workers still face a retirement crisis. Policymakers need to strengthen and expand Social Security and mandate employer-sponsored retirement plans to ensure universal coverage and adequate retirement income.