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Can Retirees Live on the Average Social Security Benefit in 2022?

If you plan to retire but don't have any money saved, will Social Security benefits be enough to support you? This is a common question many older Americans face, so before you leave the workforce, you should know what life would look like if you tried to live on Social Security alone.

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What would life be like with 2022's average Social Security benefit?

In 2022, the average Social Security benefit would provide an annual income of $19,884, and that would be tough to live on.

The Massachusetts Institute of Technology's (MIT's) Living Wage Calculator estimates how much it would cost to meet minimum standards of living across the country. Even in less expensive states like Arkansas, Indiana, Mississippi, North Dakota, Ohio, West Virginia, and Wyoming, the cost tops $27,000 per year for single adults with no children, leaving retirees short of what a typical person would need.

While many retirees may face lower costs in some categories than their younger counterparts, such as housing if they have a paid-off home, certain essentials -- including healthcare -- are likely to be much more expensive for seniors.

So for seniors with health issues, or who haven't paid off their homes, or who are helping adult children make ends meet, Social Security checks alone would probably leave them with an even bigger shortfall when it comes to affording the basics than that $19,884 number suggests.

If this isn't confirmation enough about the challenges you'd face, a quick look the federal poverty level -- $19,320 for a single person in 2022 -- shows just how big a struggle it would be. It means retirees relying just on Social Security would find their income hovers right around what the federal government considers necessary to cover the bare essentials.

What to do if you must live on Social Security alone

Unfortunately, some seniors don't have a choice. They must live on Social Security without supplementary savings because they can't stay in the workforce any longer and don't have a nest egg.

If this happens to you, there are a few things to try to make ends meet:

  • Downsize your housing: If you're a homeowner, consider selling and moving to a lower-cost property. If you can sell at a profit and buy a cheaper home, hopefully you can be mortgage-free -- and possibly get some equity out of the home that you can invest.
  • Explore eligibility for additional benefits: If your income and resources are low enough, you may qualify for Supplemental Security Income to provide extra money -- or for benefits such as the Supplemental Nutrition Assistance Program, which can help cover food costs.
  • Retire to an area with a low cost of living: While MIT's Living Wage Calculator suggests you'll face struggles everywhere, some places are much more expensive than others. In the most expensive states, including California and New York, a living wage tops $38,000.
  • Consider drastic ways to slash expenses: This could include living with a roommate or trying to get by without a car.

These are undoubtedly sacrifices, and future retirees can hopefully avoid them by recognizing that Social Security checks are meant to replace only around 40% of pre-retirement income and aren't sufficient by themselves.

Workers should prioritize saving for the future if they can, while current retirees need to be aggressive in cutting costs if they must cope with the unpleasant reality of surviving just on government benefits.

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