Detailed Projections of the Older Population through 2065

These tabulations describe the future population ages 62 and older through 2065, including their demographic characteristics, income, and wealth.

For each projection below, two methods of analysis adjust outcomes for differences in household size. The per capita tabulations divide outcomes by the number of household members. The equivalence-scale tabulations use the adjustments developed by the US Census Bureau for the federal supplemental poverty rates, which recognize savings in household spending from shared living arrangements.

Under Current Policies

“Current law scheduled” assumes that current public policies, business practices, and individual behaviors continue, and that Social Security benefits are paid as promised, even after the trust fund runs out. 

Under Social Security Reform Options

The following tables show DYNASIM projections of income, wealth, and poverty rates for adults ages 62 and older, as well as Social Security trust fund revenues, expenditures, and balances, under various Social Security policy options. The projections extend to 2065.

“Current law payable” reduces Social Security benefits by a uniform amount after the trust fund runs out so that all benefits in each year can be paid out of revenues from that year. 

“Increase the cap to $150,000” increases the tax cap to $150,000 between 2016 and 2018 and then increases the tax cap by wage growth plus +0.5 percentage points thereafter.

“Increase the cap to $180,000” increases the tax cap to $180,000 between 2016 and 2018 and then increases the tax cap by wage growth plus +0.5 percentage points thereafter.

“Increase the tax base” raises the cap on annual earnings subject to the Social Security payroll tax and that enter the benefits calculation to cover 90 percent of payroll. This increase is phased in over 10 years, beginning in 2016.

“Increase the payroll tax to 13.4%” increases the payroll tax rate to 13.4% over 10 years, beginning in 2016.

“Increase the payroll tax to 14.4%” increases the payroll tax rate to 14.4% over 10 years, beginning in 2016.

“Increase the payroll tax to 15.4%” increases the payroll tax rate to 15.4% over 10 years, beginning in 2016.

“Increase the tax base” raises the cap on annual earnings subject to the Social Security payroll tax and that enter the benefits calculation to cover 90 percent of payroll. This increase is phased in over 10 years, beginning in 2016. Also, increase the payroll tax to 13.4 percent over 10 years beginning in 2016.

“Increase the full retirement age (FRA)” indefinitely raises Social Security’s FRA (now set at 67 beginning in 2022) and the age for receiving delayed retirement credits by one month every two years, beginning in 2024.

“Increase the early eligibility age (EEA) and FRA” raises Social Security’s EEA (now set at 62), FRA, and the age for receiving delayed retirement credits by one month every two years, beginning in 2024.

“Reduce cost-of-living adjustment (COLA)” ties beneficiaries’ annual COLA to the change in the chained consumer price index (CPI), which grows more slowly than the standard CPI now used to compute COLAs.

"Cap spouse benefits" caps the spouse benefit beginning for claimants who turn 60 in 2020 at $1121.68 in 2016. Index the cap annually by chained CPI. 

“Change the benefit formula” eliminates the preferential treatment of workers with short careers by applying Social Security’s progressive benefit formula to each year of earnings and dividing by 35, rather than applying the formula to total earnings received in the top 35 years. It also makes the benefit formula more progressive.

“Increase benefits taxation” taxes Social Security benefits as normal pension income, beginning in 2020, but also raises the standard deduction that taxpayers ages 65 and older can claim on their federal income tax returns.