Social Security won’t be enough for many people to survive retirement — and yet many Americans rely heavily (or solely) on it to fund their golden years.
More than half (52%) of U.S. workers expect to rely on Social Security benefits to cover necessary retirement expenses, according to Bankrate’s 2025 Social Security Survey. And more than a quarter (28%) expect to be “very dependent”.
However, they also fear the funds will run out before they can claim them. That’s why setting up a variety of income streams now can help you prepare for a monthly income when you’re no longer working a 9-to-5 job – and in case one income stream is negatively impacted.
The Social Security and Medicare trust funds are just eight years away from insolvency, according to the latest annual reports from trustees of both organizations. This means beneficiaries could face a 23% reduction in their benefits by 2033. (1)
“The impending insolvency of the Social Security retirement program will result in an overall benefit reduction of 23 percent when today’s 59-year-olds reach Full Retirement Age (FRA) and when today’s youngest retirees turn 70. On a combined theoretical basis, recipients will face a 19 percent benefit reduction just one year later,” according to analyzes by the Committee for a Responsible Federal Budget.
At the same time, the current administration has cut staff at the Social Security Administration (SSA), leaving remaining workers struggling to serve millions of Americans. (2)
So there is a legitimate reason why American workers are worried. Regardless, even if a solution is found and benefits are not reduced, average Social Security retirement benefits are currently not enough for most Americans to live comfortably in retirement if they do not have other sources of income.
As of August 2025, the average Social Security retirement benefit for a retired worker was $2,008 per month. That’s only $24,000 a year. (3)
It could be much less depending on your professional background and when you request your benefits; If you do not wait until full retirement age, 67, your benefit will be permanently reduced.
The average retired household (ages 65 to 74) spends about $5,400 per month, or $65,000 per year, in retirement on essential and discretionary items, according to the Consumer Expenditure (CE) Survey Program of the Federal Reserve Bank of St. Louis. (4) The average Social Security retirement benefit would therefore not be sufficient, even if two spouses each received a check.
However, Social Security was never designed to fund a person’s entire retirement; rather, it was intended to be part of a larger plan that included employer-sponsored pensions or retirement plans, as well as personal retirement savings.
Read more: Vanguard reveals what could happen for U.S. stocks, and it’s raising alarm bells for retirees. Here’s why and how to protect yourself
Retirements: If you’re a civil servant or one of the 15% of private sector workers with access to a traditional pension, this could represent a significant portion of your retirement income. (5)
Retirement accounts: While not everyone benefits from a traditional pension, you may have access to an employer-sponsored retirement account, such as a 401(k) or 403(b) plan — and if your employer matches your contributions, you can significantly increase those savings.
You can also save money for retirement in a traditional IRA (individual retirement account), which can reduce your current taxable income (you pay taxes when withdrawn). However, 401(k)s and IRAs offer Roth versions, in which you contribute after-tax dollars and don’t have to pay taxes on qualified withdrawals. (So tax considerations should be part of your retirement strategy.)
High Interest Deposit Accounts: You can also put money away in certificates of deposit (CDs), money market accounts, and high-yield savings accounts (but do your research to get the best CD interest rate).
The advantage is that your money is more easily accessible. With a high-yield savings account, you can access your money whenever you want; with a CD, your funds are locked in for a specific period of time.
Dividend Paying Stocks: If you invest in stocks and bonds, you may also want to consider dividend-paying stocks, as they provide a steady stream of income from dividend payments, in addition to appreciation. Dividends tend to be paid quarterly, although some are paid monthly.
Annuities: Another way to get guaranteed income in retirement is to purchase an annuity from your insurance company. This is financed in advance, either through a lump sum or a series of payments, and the money earns interest.
Then the initial investment and growth is paid back to you over a set period of time or over the course of your life (usually monthly). However, annuities come with fees that could affect long-term returns.
Real estate: If you are prepared to take on the responsibility of becoming a landlord, you could generate a steady stream of income from rent, although this must be weighed against the cost of owning a property and becoming a landlord.
For example, you will have to pay taxes on rental income, maintenance, and if you have a mortgage on the house, you may also have to take out landlord and maintenance insurance.
But this is not the only way to invest in real estate. You may also consider investing in private real estate funds (avoiding the hassle of direct ownership), accessing the real estate value market, or tapping into residential or commercial real estate markets through investment platforms.
When it comes to putting together a paycheck from your retirement accounts, there are a lot of things to consider. You may want to consult a qualified financial advisor to help you achieve your goals, without relying too heavily on Social Security.
We rely only on verified sources and credible third-party reports. For more details, see our editorial ethics and guidelines.
Committee for a Responsible Financial Budget (CRFB) (1); NPR (2); Social Security Administration (3); Federal Reserve Bank of Saint-Louis(4); U.S. Bureau of Labor Statistics (5).
This article provides information only and should not be considered advice. It is provided without warranty of any kind.
