Social Security Wealth and Federal Liabilities

Abstract

This study identifies Social Security wealth as accrued benefits based on past participation in the program. This definition is similar to accrued pension wealth associated with defined benefit plans. Accrued Social Security benefits are imputed to households in the 2016 Survey of Consumer Finances to determine the degree to which they reduce wealth inequality. The estimated accrued Social Security benefits are much more evenly distributed than are the estimates of savings wealth. Households, in the top 10% of the estimated wealth distribution, excluding Social Security, held 75% of wealth as of 2016, but only 18% of accrued Social Security benefits. Once accrued Social Security benefits are included in a total wealth measure, the percent of the total attributable to the same to 10% of households declines to 64%.