October 2013 Update : Social Security-Annual Change In Enrollment

The October 2013 Social Security recipients report was released today showing a monthly increase of 110k people with an average monthly benefit of $1,163…up $1 over September. We continue to see a gradual slowdown…with 20k fewer new enrollments than last October’s 130k increase. The TTM delta is now at 1.227M, so averaging right at 100k per month, though there are large seasonal variations (which is why we look at the TTM).

For reference, we peaked at a TTM rate of 1.624M almost 4 years ago in 12/2009 and have been trending down since then. Still…1.227 is still very high historically. Looking back 10 years to 2013, the rate was under 600k. The course from here will be a very important factor in how quickly the budget deficit deteriorates over the next 5-10 years. On the positive side, though high, the rate is still trending down, and there is a good chance that a lot of the people you would have expected to be retiring now or soon actually already did….causing the 2009 spike…and the subsequent dip.

On the other side, we are still working through the left tail of the boomer  population distribution. I have a table published in 2011 that shows the US population by age. As of 2011, there were 2.7M of living Americans born in 1948….who would be turning 65 this year. Contrast that to those born in 1949 at 3.7M. Not sure what they put in the water that year, but roughly 1M more Americans will turn 65 in 2014 than in 2013. From here, we have a steady increase until 2028 when 4.6M born in 1963 will turn 65. Obviously that’s based on the 2011 snapshot and not adjusted for mortality. And while currently, people become eligible for Medicaid at 65, they can apply for SS anytime between 62 and 70…with the benefits growing the longer they wait.

So the main thing I am looking for with this data series is a bottom in the TTM rate and for the trend to turn back up. October 2013 was not that month. I don’t know if it happens next year, or five years from now, but when it does lookout because it’s going to get ugly(er).