Abstract: The fiscal pressures on the federal budget created by an aging population warrant an examination of senior citizens’ incomes. We use the Survey of Consumer Finances, supplemented by the Current Population Survey, to document changes in incomes headed by senior citizens age 65 and older and the sources of these changes from 1982 to 2018. Our analysis documents a substantial and broad-based growth in senior household incomes that far outpace income growth among younger households. The strong income growth occurs across the senior household income distribution, among age sub-groups, household types, and education levels of household heads. In 2018, after adjusting for household size and taxes, median income among senior households has reached parity with that of younger households. Income from private retirement plans and employment earnings are the primary drivers of senior household income growth. While Social Security plays a relatively minor role in the income growth among senior households in the upper half of the income distribution, it still plays an important role among those in the lower half of the income distribution.
Read the paper: Changes in Income Among Senior Citizens: 1982-2018
