Life Insurance
Social Security Benefits Leave Surviving Parents and Kids Nearly $3,200 Short of a Worker’s Typical Earnings Each Month
Nobody expects tragedy. But when it strikes in your immediate family, it often leaves you swimming in grief, funeral planning and legalities. For many, the impact of losing your spouse’s income may be another life-changing stressor to add to the list — particularly if you have underage children.
ValuePenguin researchers looked at where Social Security survivors benefits are falling short — and, thus, where life insurance is especially critical. For a surviving spouse and two children, we found that there’s no state where the average monthly Social Security benefits are enough to cover the average earnings of a full-time, year-round worker.
Here’s what else we found.
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Key findings
- Average Social Security benefits in the U.S. for a surviving parent and two children only cover 49.2% of the average earnings for a full-time, year-round worker. This leaves a monthly deficit of nearly $3,200.
- The shortfall is most severe in Massachusetts, where average benefits for a surviving parent and two children would only cover 40.8% of a full-time worker’s average earnings in the state. While average benefits in the state are among the 10 highest, earnings are the highest in the U.S. by nearly $700 monthly, creating the large shortfall. California (43.2%) and New York (43.9%) are next.
- Average Social Security survivors benefits for a widow(er) with two children cover at least 60% of the average earnings in just three states. Those three states are Mississippi (61.4%), Oklahoma (61.1%) and Wyoming (60.6%).
- Depending on your age and health status, life insurance is a costly but effective security measure. A separate ValuePenguin analysis on average life insurance costs found that the average 20-year-term life insurance policy costs about $147 a month — providing a death benefit (or policy payout) of $500,000 for surviving family members.
Average Social Security benefits cover less than half of average earnings
In the U.S., average Social Security benefits for a surviving parent and two children only cover 49.2% of the average earnings for a full-time, year-round worker — a monthly deficit of $3,183.47.
According to ValuePenguin life insurance expert Nick VinZant, it’s not surprising that Social Security is falling behind — but it’s surprising how much it has fallen behind in recent years.
"Inflation and changes in the cost of living have eaten away at Social Security benefits," he says. "Over the last 22 years, Social Security as a whole has lost 40% of its buying power. Social Security officials are trying to make adjustments, but they aren’t keeping pace. For example, Social Security recipients (which includes survivors benefits) got a nearly 6% cost-of-living adjustment in 2022. Inflation, however, has been around 8%."
For 2023, the cost-of-living adjustment (COLA) increased Social Security benefits by 8.7% — the largest jump in 40 years. For those with children receiving survivors benefits, that’s an increase of $282 a month. In each state, however, that’s nowhere near enough to cover a full-time worker’s average earnings — particularly in those where current benefits cover the lowest percentage of earnings (more on that below).
Massachusetts benefits cover the lowest percentage of earnings
Social Security survivors benefits fall the shortest in Massachusetts. For a surviving parent and two children, average benefits would only cover 40.8% of a full-time worker’s average earnings in the state.
Notably, the average survivors benefits in Massachusetts are $3,281.67 a month — among the 10 highest. However, workers here earn $8,050.92 a month, making it the state with the highest average earnings in the U.S. by nearly $700. Given that, those receiving survivors benefits get an average of $4,769.25 less than the average earnings.
States where Social Security survivors benefits fall the shortest
Rank | State | Average monthly earnings for a full-time, year-round worker | Average monthly benefits for surviving parent and two children | Monthly shortfall ($) | Monthly shortfall (%) | Percentage of earnings covered by benefits |
|---|---|---|---|---|---|---|
| 1 | Massachusetts | $8,050.92 | $3,281.67 | $4,769.25 | 59.2% | 40.8% |
| 2 | California | $7,355.58 | $3,177.66 | $4,177.92 | 56.8% | 43.2% |
| 3 | New York | $7,433.42 | $3,264.18 | $4,169.24 | 56.1% | 43.9% |
| 4 | New Jersey | $7,871.08 | $3,466.45 | $4,404.63 | 56.0% | 44.0% |
| 5 | Washington | $7,565.25 | $3,349.21 | $4,216.04 | 55.7% | 44.3% |
Source: ValuePenguin analysis of U.S. Census Bureau 2021 American Community Survey and U.S. Social Security Administration (SSA) data.
California (43.2%) and New York (43.9%) rank next. Like Massachusetts, California and New York are among the top-10 states where workers earn the most. In California, workers earn $7,355.58 on average, ranking it sixth overall. In New York, meanwhile, average monthly earnings are $7,433.42, ranking it fifth.
It’s a trend that continues throughout the top-ranking states. In fact, workers in seven of the 10 states where Social Security benefits fall shortest make more than $7,000 on average.
Survivors benefits cover more than 60% of earnings in Mississippi, Oklahoma and Wyoming
There’s no state where the average Social Security survivors benefits are enough to make up for the average earnings of a full-time, year-round worker for a widow (or widower) with two kids. In fact, even the states that come the closest still fall very short.
In just three states, average Social Security survivors benefits for a widow(er) with two children cover at least 60% of the average earnings. Mississippi leads, covering 61.4% of a worker’s average earnings. That’s followed by Oklahoma (61.1%) and Wyoming (60.6%).
States where Social Security survivors benefits cover the biggest share of lost worker earnings
Rank | State | Average monthly earnings for a full-time, year-round worker | Average monthly benefits for surviving parent and two children | Monthly shortfall ($) | Monthly shortfall (%) | Percentage of earnings covered by benefits |
|---|---|---|---|---|---|---|
| 1 | Mississippi | $4,504.67 | $2,765.21 | $1,739.46 | 38.6% | 61.4% |
| 2 | Oklahoma | $4,889.17 | $2,988.51 | $1,900.66 | 38.9% | 61.1% |
| 3 | Wyoming | $5,480.92 | $3,321.65 | $2,159.27 | 39.4% | 60.6% |
| 4 | Arkansas | $4,839.17 | $2,854.91 | $1,984.26 | 41.0% | 59.0% |
| 5 | Idaho | $5,395.17 | $3,160.02 | $2,235.15 | 41.4% | 58.6% |
| 5 | West Virginia | $5,076.25 | $2,975.35 | $2,100.90 | 41.4% | 58.6% |
Source: ValuePenguin analysis of U.S. Census Bureau 2021 American Community Survey and SSA data.
In contrast to the states where Social Security survivors benefits fall the shortest, those that come closest generally have the lowest average monthly earnings. Mississippi has the lowest earnings of any state, with workers earning an average of $4,504.67 a month. While Oklahoma has the third-lowest earnings — with average earnings of $4,889.17 per month — Wyoming is an exception. Workers here earn an average of $5,480.92 a month, placing it among the bottom half of states when ranked by earnings.
Still, it’s worth noting that workers in three of the six top-ranking states earn less than $5,000 a month on average — which may explain why Social Security benefits come closest to closing the gap here.
Full rankings: States where Social Security survivors benefits fall shortest
Rank | State | Average monthly earnings for a full-time, year-round worker | Average monthly benefits for surviving parent and two children | Monthly shortfall ($) | Monthly shortfall (%) | Percentage of earnings covered by benefits |
|---|---|---|---|---|---|---|
| 1 | Massachusetts | $8,050.92 | $3,281.67 | $4,769.25 | 59.2% | 40.8% |
| 2 | California | $7,355.58 | $3,177.66 | $4,177.92 | 56.8% | 43.2% |
| 3 | New York | $7,433.42 | $3,264.18 | $4,169.24 | 56.1% | 43.9% |
| 4 | New Jersey | $7,871.08 | $3,466.45 | $4,404.63 | 56.0% | 44.0% |
| 5 | Washington | $7,565.25 | $3,349.21 | $4,216.04 | 55.7% | 44.3% |
| 6 | Connecticut | $7,724.25 | $3,464.75 | $4,259.50 | 55.1% | 44.9% |
| 7 | Maryland | $7,247.08 | $3,275.56 | $3,971.52 | 54.8% | 45.2% |
| 8 | Virginia | $6,835.17 | $3,170.78 | $3,664.39 | 53.6% | 46.4% |
| 9 | Colorado | $6,713.75 | $3,268.41 | $3,445.34 | 51.3% | 48.7% |
| 10 | Alaska | $6,196.50 | $3,051.15 | $3,145.35 | 50.8% | 49.2% |
| 10 | Illinois | $6,536.92 | $3,217.00 | $3,319.92 | 50.8% | 9.2% |
| 12 | Minnesota | $6,520.42 | $3,276.68 | $3,243.74 | 49.7% | 50.3% |
Source: ValuePenguin analysis of U.S. Census Bureau 2021 American Community Survey and SSA data.
Is life insurance worth the cost?
With Social Security benefits falling so short in most states, life insurance may seem like a viable security measure for your family. However, another ValuePenguin analysis on life insurance costs found that the average 20-year-term life insurance policy costs about $147 a month — and many don’t think that steep fee is worth it. In fact, according to a ValuePenguin survey on pandemic life insurance policy views, 36% of those who don’t have life insurance think it's too expensive of an investment.
However, that average 20-year-term life insurance policy provides a death benefit of $500,000 for surviving family members. Given that payout, which is arguably much better than average Social Security survivors benefits, is it worth the cost? According to VinZant, it certainly can be.
"Life insurance can really help ease the financial strain of losing a family member," he says. "Benefits from a life insurance policy can range from hundreds of thousands to millions of dollars in financial support. They also don’t affect Social Security benefits, so family members would still be entitled to their full Social Security benefits."
If you’re on the fence about life insurance, VinZant says there are other things you can do to better ensure your family’s financial security in the meantime. Particularly, he recommends establishing a will or trust, organizing and updating important documents, and determining your beneficiaries if you decide to purchase a life insurance policy. While nobody likes to imagine an unexpected loss, preparing your family can help ensure their future is better protected.
Methodology
ValuePenguin researchers compared the average earnings of full-time, year-round workers in each state to the average Social Security benefits received by a qualifying surviving parent with two eligible children in each state.
The state data includes surviving parents of the deceased, as well as all surviving widow(er)s, while we only use surviving young widow(ers) with children in care for this analysis. To correct for this discrepancy at the state level, we first divided the nationally available average monthly benefit in December 2021 for young widow(er)s with a child in care by the national average for all adult survivors of the deceased who receive benefits, and then multiplied that result to each state’s average of benefits to all adult survivors. Surviving parents are defined as "young widow(er) with child in care," and eligible children are defined as "child of deceased worker."
Earnings data is from the U.S. Census Bureau 2021 American Community Survey with one-year estimates — the latest available. Social Security data is from the U.S. Social Security Administration (SSA).