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Social Security Is a Great Equalizer

January 21, 2020
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The brief’s key findings are:

  • As the U.S. grows more diverse, it is important to understand how much Social Security affects the relative economic status of retirees by race/ethnicity.
  • This analysis uses the Health and Retirement Study to examine Social Security as a share of retirement wealth for whites, blacks, and Hispanics during 1992-2016.
  • Without Social Security, a typical white household has 5 to 7 times the wealth of a minority household, but adding in Social Security reduces the gap to 2 to 3.
  • Social Security has a similar leveling effect across the wealth distribution, but is particularly important for lower- and middle-income households.
  • Social Security reduces inequality because it covers nearly all workers and has a progressive benefit design, making it the most equal form of retirement wealth.
Check from U.S. Treasury with cash and social security card
Check from U.S. Treasury with cash and social security card
Author(s)
Headshot of Wenliang Hou
Wenliang Hou
Headshot of Geoffrey T. Sanzenbacher
Geoffrey T. Sanzenbacher
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Citation

Hou, Wenliang and Geoffrey T. Sanzenbacher. 2020. "Social Security Is a Great Equalizer" Issue in Brief 20-2. Chestnut Hill, MA: Center for Retirement Research at Boston College.

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Other Project Publications
  • Working Paper
  • Squared Away Blog
Associated Project(s)
  • BC19-07
Topics
Racial Disparities
Social Security
Publication
Issue Brief
Publication Number
IB#20-2
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