Social Security: Residents in These US Cities Are Most Reliant on Benefits

Close up of a senior couple having breakfast and doing bills.
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Over 64 million Americans saw their Social Security monthly payments increase by 5.9% in January (approximately 70 million, if you take into account those who receive Supplemental Security Income, or SSI. This is attributed to an increase in the cost-of-living adjustment, which represents the largest COLA increase since 1983.

SmartAsset, a NYC-based financial tech company, recently analyzed Social Security incomes for the 100 U.S. cities with the highest 65-and-over population to determine where Social Security makes up the highest (and lowest) percentage of total retirement income.

The study focused on two measures from the U.S. Census Bureau’s 2020 5-year American Community Survey: average retirement income (pensions, annuities or insurance and income from IRA plans) and average Social Security income (Social Security Administration-issued pension payments, survivor benefits and permanent disability insurance).

Among the key findings, SmartAsset found that in cities where total retirement is low, citizens depend on Social Security the most. Additionally, Social Security benefits account for more than a quarter of retirement income for every city reviewed (Miami has the lowest percentage of Social Security making up overall retirement income, at 26.90%). Numerous cities in California have large numbers of residents 65 years and older, but they rely the least on Social Security (between 30.1% and 36.6% of its residents’ total retirement income).

Just one of the 100 cities reviewed — Fort Wayne, Indiana — showed a percentage of total retirement income coming from Social Security over 50% (52.38% with an average of $19,666 out of the total retirement income average coming from Social Security). The remaining cities in the top five of were Hialeah, FL (49.23%, $13,365 Social Security income, $27,149 total retirement income), Wichita, KS (48.77%, $20,144, $41,305), Indianapolis, IN (47.53%, $19,617, $41,270) and Tulsa, OK (46.87%, $20,273, $43,256).

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The five cities with the lowest percentage of retirees who rely on Social Security were Miami, FL (26.90%, $14,043 Social Security income, $52,213 total retirement income), Washington, DC (28.50%, $17,174, $60,254), Baton Rouge, LA (29.87%, $17,449, $58,426), Glendale, CA (30.14%, $18,013, $59,763) and Anchorage, AK (31.54%, $17,745, $56,255).

Social Security was designed to be a supplement to retirement income (pensions and savings). It currently replaces about 40% of the average American’s retirement income, and four in ten older Americans have the monthly benefit as their only source of retirement income, according to a 2020 study from the National Institute on Retirement Security.

It will be interesting to see how retirees fare this year with consumer price increases across the board and a sustained 40-year-high inflation rate, and how much Social Security, with its 2022 COLA increase, will have an impact on supplemental income and quality of life in retirement.

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