Social Security falling short? These 6 income streams can turn retirement into a paycheck

Best retirement income sources: For many Americans, Social Security feels like the foundation of retirement. But growing reliance on those benefits, combined with concerns about the program’s future, is raising questions about whether it will be enough to cover everyday living costs once work ends.

How many Americans expect to rely on Social Security

Bankrate’s 2025 Social Security Survey shows that 52% of working Americans expect to depend on Social Security to pay for necessary expenses in retirement, as per a report. More than one in four, or 28%, say they expect to be very reliant on those monthly checks. At the same time, many workers worry that Social Security funds could run short before they ever claim benefits.

Why Social Security alone may not cover retirement costs

Those fears are tied to the financial outlook of the program. The latest Trustees’ Reports for Social Security and Medicare show that the trust funds are about eight years from insolvency. If no action is taken, benefits could be cut by 23% by 2033, as per a Moneywise report. Analysis from the Committee for a Responsible Federal Budget suggests those reductions could affect people reaching full retirement age as well as younger retirees in the years that follow.


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How much the average Social Security check pays in 2025

Even if benefits are not reduced, the current payout often falls short of what retirees need. As of August 2025, the average Social Security retirement benefit for a retired worker was $2,008 per month, or about $24,000 a year, as per the Moneywise report. That amount can be lower depending on a person’s work history and when they choose to claim. Claiming before the full retirement age of 67 results in a permanent reduction in benefits.

Why retirement expenses often exceed Social Security income

By comparison, data from the Consumer Expenditure Surveys show that households between ages 65 and 74 spend around $5,400 per month, or $65,000 a year, on essential and discretionary expenses, as per the Moneywise report. Even two Social Security checks may not fully cover those costs.

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Six income streams retirees use to supplement Social Security

Social Security was never designed to replace an entire paycheck. Instead, it was meant to work alongside other income sources. As a result, many retirees look to additional streams to create more reliable monthly income.

Pensions remain a key source for government workers and the roughly 15% of private-industry employees who still have access to traditional pension plans, as per the Moneywise report.

Employer-sponsored retirement accounts, such as 401(k) and 403(b) plans, provide another major source of income. Employer matching contributions can significantly boost savings over time. Individual retirement accounts, including traditional and Roth IRAs, offer additional options, with different tax treatments depending on the account type, as per the Moneywise report.

Some retirees rely on high-interest deposit accounts, including certificates of deposit, money market accounts, and high-yield savings accounts. These accounts offer easier access to funds, though CDs typically require money to be locked in for a fixed period.

Dividend-paying stocks can provide regular income through dividend payments, often paid quarterly, along with the potential for price appreciation.

Annuities are another option for steady income. Funded in advance through a lump sum or ongoing contributions, annuities pay out the original investment and any growth over a set period or over a lifetime, usually on a monthly basis. Fees, however, can affect long-term returns.

Real estate can also generate income through rental payments, but it comes with responsibilities such as taxes, maintenance, and insurance. For those who prefer not to manage property directly, private real estate funds and investment platforms offer alternative ways to invest in residential or commercial real estate, as per the Moneywise report.

FAQs

Why are so many Americans worried about Social Security?
Because more than half of working Americans expect to rely on it, while reports show the trust fund could face insolvency within eight years.

How many people expect to depend heavily on Social Security?
According to Bankrate’s 2025 survey, 52% expect to rely on it, and 28% say they will be very reliant.