Shared Households and the Anti-Poverty Impacts of Older Adults’ Social Security Benefits

• In Event: Aging and Intergenerational Supports: Economic and Care Resources Across Generations

Abstract

A large share of older adults, about 22%, share a home with an adult extended family member or non-relative. Sharing a household may provide an economic safety net for the older adult as well as the other household members, allowing them to increase their household income and benefit from economies of scale. Because many older adults receive Old Age and Survivors’ Insurance (OASI) and Supplementary Security Income (SSI), shared households may also extend the reach of these federal benefits beyond the direct program beneficiaries.

 

In this paper, we use data from the 2014-2021 panels of the Survey of Income and Program Participation (SIPP) to examine the role of OASI and SSI benefits as an income source in older adults’ shared households, with potential benefits that extend beyond the direct beneficiary. First, we identify the characteristics of the adults with whom older adults share a home, either as a guest (living in someone else’s home) or as a host (sharing their home with others). Second, we ask what proportion of household income in these households comes from older adults’ OASI and SSI, respectively. We then identify the shared households in which these benefits raise the household-level income above the poverty line to estimate the number of non-beneficiaries that older adults’ OASI and SSI benefits, respectively, raise out of poverty through shared households.

 

We find that SSA benefits have important antipoverty impacts, especially in older adult OASI beneficiaries’ shared households; OASI income accounts for over 1/3 of household income on average and raises one in five of these households out of poverty. Moreover, the impact of these benefits extends beyond the direct recipients; OASI beneficiaries in shared households live with an average of 2.1 adult non-beneficiaries. Although the antipoverty role of SSI benefits is somewhat smaller, likely reflecting the relatively small size of these benefits, they are also far-reaching; older adult SSI beneficiaries are far more likely to live in shared households than non-beneficiary older adults, and those who do live in shared households live with an average of 2.7 non-beneficiaries. We also find substantial variation by race and ethnicity in the prevalence of shared households and the anti-poverty impact of SSA benefits in these households.

 

Our analyses reveal the vital role that OASI and SSI benefits for older adults play in economic security, not only for the older adults themselves, but also for the many non-beneficiaries with whom they share a home. These findings are important for considering the ripple effects of policy changes that may reduce access to SSA benefits.

Authors

• Hope Harvey, University of Kentucky
  Presenting Author

• Kristin L. Perkins, Georgetown University
  Non-Presenting Co-Author