Social Security won’t be enough for many to get them through retirement; However, many Americans rely heavily (or solely) on it to finance their golden years.
More than half (52%) of American workers expect to rely on Social Security benefits to cover necessary expenses when they retire, according to Bankrate’s 2025 Social Security Survey. And more than a quarter (28%) expect to be “very dependent.”
However, they are also concerned that the funds will run out before they can claim them. That’s why setting up multiple income streams now can help you prepare for monthly income when you’re no longer working 9 to 5, 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 the trustees of both organizations. That means beneficiaries could face a 23% cut in their benefits by 2033. (1)
“The imminent insolvency of the Social Security retirement program will lead to an overall 23 percent benefit cut when today’s 59-year-olds reach Full Retirement Age (FRA) and when today’s youngest retirees turn 70. In theory, beneficiaries will face a 19 percent benefit cut just one year later,” according to analysis by the Committee for a Responsible Federal Budget.
At the same time, the current administration has cut the staff of the Social Security Administration (SSA), leaving remaining workers struggling to serve millions of Americans. (2)
So there is a legitimate reason for American workers to be worried. Still, even if a solution is found and benefits are not drastically reduced, the average Social Security retirement benefit right now is not enough for most Americans to live comfortably in retirement if they have no other sources of income.
In 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)
That could be much less depending on your work history and when you claim your benefit; If you do not wait until you reach full retirement age of 67, your benefit will be permanently reduced.
The average retired household (ages 65 to 74) spends about $5,400 a month, or $65,000 a year, in retirement on essential and discretionary items, according to the Federal Reserve Bank of St. Louis’ Consumer Expenditure Survey (CE) program. (4) Therefore, the average Social Security retirement benefit would not be enough, 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 broader plan that included employer-sponsored pensions or retirement plans as well as personal retirement savings.
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Pensions: If you’re a government worker, or one of the 15% of private industry workers with access to a traditional pension, that could be a significant portion of your retirement income. (5)
Retirement accounts: While not everyone has a traditional pension, you may have access to an employer-sponsored retirement account, such as a 401(k) or 403(b), and if your employer matches your contributions, you can significantly increase those savings.
You can also set aside money for retirement in a traditional IRA (individual retirement account), which can reduce your current taxable income (you pay taxes when you withdraw). However, both 401(k)s and IRAs offer Roth versions, where you contribute after-tax dollars and don’t have to pay taxes on qualified withdrawals. (Therefore, tax considerations should be part of your retirement strategy.)
High interest deposit accounts: You can also keep money in certificates of deposit (CDs), money market accounts, and high-yield savings accounts (though 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 set period.
Stocks that pay dividends: If you invest in stocks and bonds, you may also want to consider dividend-paying stocks, as they provide a regular income stream from dividend payments in addition to appreciation. Dividends tend to be paid quarterly, although some are paid monthly.
Annuities: Another way to get a guaranteed income stream in retirement is through an annuity with your insurance company. This is funded upfront, either through a lump sum or a series of payments, and the money earns interest.
The initial investment and growth is then returned to you over a specified period or over your lifetime (usually monthly). However, annuities come with fees that could affect long-term returns.
Real estate: If you are willing to take on the responsibility of becoming a landlord, you could generate a regular stream of income from renting, although this needs to be weighed against the cost of owning a property and becoming a landlord.
For example, you will have to pay taxes on rental income and maintenance, and if you have a mortgage on the house, you may also need to take out homeowner’s and maintenance insurance.
But this is not the only way to invest in real estate. You could also consider investing in private real estate funds (avoiding the hassle of direct ownership), accessing the real estate stock market, or accessing the residential or commercial real estate markets through investment platforms.
When it comes to collecting a paycheck from your retirement accounts, there’s a lot to consider. You may want to consult with a qualified financial advisor to help you achieve your goals, without relying too much on Social Security.
We rely only on verified sources and credible third-party reports. For more information, see our editorial guidelines and ethics.
Committee for a Responsible Financial Budget (CRFB) (1); NPR (2); Social Security Administration (3); Federal Reserve Bank of St. Louis(4); US Bureau of Labor Statistics (5).
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
