Social Security payments are a major foundation of the nation, with around 72 million Americans receiving government aid. Worryingly, almost half of all people over the age of 65 get at least 50% of their family income from Social Security payments, with another 25% claiming that Social Security benefits account for 90% or more of their monthly income.
Because the program has so many dependents, the fact that men cannot make ends meet on their benefit alone is even more troubling, as there are numerous expenditures that come with age that need a substantial nest fund, which is simply not available.
Steven Bosworth, a financial counselor and managing director of Bosworth Financial Group, feels that if seniors depend only on Social Security, they will be unable to finance many items throughout retirement. Here are some of the more popular examples.
Medical Care expenses on Social Security
The elderly’s most vital cost may also be one of the most expensive. Americans spend around $12,000 per year on health-care costs, making them the most costly nation in the world. However, this is the average, and individuals with chronic and substantial medical conditions pay far more. As Bosworth notes, “Medical expenses can skyrocket, and if retirees can’t afford medical care, they won’t get the proper treatment that they deserve.”
While government-run programs such as Medicare (federal) and Medicaid (state) cover part of the expenditures, out-of-pocket charges, monthly premiums, and prescription prescriptions must still be paid for.
According to T. Rowe Price, the typical retiree on regular Medicare, Medigap, and Medicare Part D (prescription medicines) will spend $900 per year, with 10% spending $4,200 or more. And that’s after coverage.
Long-term care, cosmetic procedures, dental treatment or dentures, eye tests, or concierge care, all of which are required for certain ailments, are also not covered by government programs.
Vacations
Those receiving Social Security cannot afford to spend money on vacations; as Bosworth points out, “these retirees will need their Social Security for their living expenses.”
While this may seem to be extravagant, ValuePenguin reckons that the typical individual spends approximately $3,251 for a budget-friendly foreign vacation lasting 12 nights, while domestic visits cost substantially less, about $581 for four nights. Given that the average Social Security payment in 2024 is $1,907, most excursions, especially domestic ones, are out of the question, since other costs may take priority.
Car Maintenance
Bosworth also classifies this as unaffordable, stating that “maintaining a vehicle can be expensive as the cost of repairs usually requires you to pay hundreds of dollars or more at one time.”
Again, the numbers back up his claim: CarInsurance.org estimates the average cost of yearly maintenance at $1,200 to $1,800, with annual repairs for items like battery replacements or new tires boosting the budget by around $500 on average.
These expenditures are not always as expensive, and dependable and newer automobiles may need less maintenance, but every car eventually has to be serviced. Extended warranties or coverage via a private insurance provider may help keep prices down, but it is still an extra expense to bear.
Homeowners and Car Insurance
Insurance is costly and increases year after year, making it unsustainable for persons on fixed incomes whose increases do not keep up with the demands of private insurance firms. Costs vary based on coverage, location, and the age and condition of the insured property, but in the United States, homeowners insurance may cost up to $2,600 per year for a $300,000 house.
Also See: Social Security Announces Retirement Pension Increase for Housewives in 2025
