A lot of Americans put some of their income into savings while they are working so they have a steady source of money when they retire.
An important program for this purpose is Social Security, which gives monthly payments that range from just over $1,000 at the low end to about $4,500 at the high end.
As prices rise due to inflation and interest rates stay high, many retirees depend on this income more than ever.
In 2024, Social Security payouts will reach about 64 million people across the country. These payments will help these people stay financially stable. Not all seniors are so lucky, though.
The Social Security Administration (SSA) says that 3.3% of seniors will never get any benefits. This is a small but important number.
These people are called “never beneficiaries,” which means they will never get benefits, no matter how old they are or whether they might have been qualified.
Why some beneficiaries may never get Social Security benefits
Some groups of people who do not get rewards are in certain groups. A lot of these people are refugees who came to the U.S. after they were older.
The SSA says that 88% of people who are in the “never beneficiaries” group are either foreigners who came late or people who do not work very often.
People who came to the U.S. after age 50 and have not made enough money to apply for benefits are usually late-arriving immigrants. Because they have not worked as long, their Social Security payments often fall short of the minimum needed to be eligible.
Another group that has trouble qualifying is workers who only show up sometimes. People in this group may not have had steady work their whole lives, so they have not put enough money into the system to meet the standards for Social Security.
Also, some Americans work in jobs that are not covered by Social Security, like some government jobs, even though they make enough money to qualify. In these cases, they may count on pensions or other forms of retirement income instead of Social Security.
Unfortunately, some people who are eligible for benefits never live long enough to get them, which adds to the number of “never beneficiaries.”
There is a bigger chance that people in this “never beneficiaries” group will be poor in retirement. For many retirees, Social Security benefits are an important safety net.
Those who do not get these payments are much more likely to have serious money problems. SSA statistics shows that 54.3% of people who have never received Social Security benefits live below the poverty line, while only 5.8% of people who do receive benefits do.
This big difference shows how important these payments are for keeping seniors from being poor.
Americans can also miss out on the benefits they are due to if they make mistakes when they apply for Social Security.
There are thousands of rules that govern who can get benefits and how much they are worth, which can make the Social Security system hard to understand.
A expensive mistake can happen with just one mistake in the filing process. One main reason why some Americans do not get the Social Security funds they deserve is that they make mistakes when they file their taxes.
It is thought that Americans lose at least $100,000 in Social Security benefits over the course of their lives because they make mistakes when they file their taxes.
Making mistakes that you can avoid during the application process can cost you a lot of money, especially if you depend on these payments a lot in retirement.
One usual, but controversial, way to get more out of Social Security is to put off getting it for a while. Social Security payments go up by 8% every year they are delayed, making this a tempting choice for people who want to make more money in retirement.
If the person does not live long enough to get the delayed payouts, or if changes happen to the Social Security system in that time, this strategy could backfire. Also, if benefits go up, taxes might go up, which could cancel out the benefits of waiting.
