January 2015 Update: Social Security Enrollment

It’s been 7 months since my last SS update, so first a quick refresher. SS is a broad program best known for the retired worker program…..where you pay in a portion of your paycheck each week, and in return, will hopefully get a monthly check once you reach~65….for the rest of your life. As of January, there were 39.1M retirees collecting an average of $1,331 per month, which pencils out to $52B per month, or $625B per year. This population is growing at about 1.1M per year…that is new retirees less deaths of existing enrollees = 1.1M per year.

Moving on…the second largest piece of SS is Disabled Workers, with 8.9M people receiving an average of $1,165 per month. The balance is about 10 smaller categories of children, spouses, widows etc…. of retirees and disabled workers. Each month, the government releases a reporthere that details the new monthly totals, their average monthly benefit, and even the Male/Female split if that interests you.

Any one report isn’t all that useful, but by compiling them and tracking the monthly and annual changes, one can squeeze some useful, or at least interesting data out of them. I track them for two primary reasons. First, SS is a huge part of the cash deficit, …$773B over the last 12 months ending in January, good for 20% of cash outlays, and growing at 5% per year. Supposedly, at some  point over the next 5 years, we should start hitting the meat of the Baby Boomers, resulting in a notable increase in enrollment and cost….I want to see it in real time.

Second, as you will see in the charts below, there is a noticeable correlation between the state of the economy and the SS enrollment rate. In the “Great Recession”, we saw enrollment rates more than double from 2007 to 2009. Again, this series gives us a real time window into the decisions millions are making…. It may or may not be a leading indicator, but it is certainly worth watching because if we have another spike, whether from the boomers retiring or a recession, it will have a noticeable affect on the deficit.

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Author: Travis Esquivel

Travis Esquivel is an engineer, passionate soccer player and full-time dad. He enjoys writing about innovation and technology from time to time.

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