Same Sex Marriage Won’t Alter Social Security Predictions Much

In the recent Social Security Trustees report, the issue of same sex marriage made a surprising appearance. Without calling much attention to it, the Trustees assume that all states will eventually legalize same-sex marriage. And while this would increase spending somewhat, they estimate the financial impact would be minimal.

Buried in the 250-page report is a small comment about same-sex marriage, sparked by the 2013 Supreme Court decision that prohibited the federal government from denying benefits for couples in states that recognized those marriages.

The report says there is significant uncertainty around the cost of new benefits because rules have not been finalized about how far back a marriage would count. Would it start at the time of the Supreme Court decision or when the state legally recognized the marriage, as the Social Security Administration has proposed? Adding to the uncertainty is how many states will legalize same-sex marriage.

The Trustees assume all states will eventually legalize same-sex marriage, and make their projections based on this prediction.

In the past, some have warned about the potential cost of same sex marriage to the Social Security system. But even after the higher dependent and surivors benefits, the Trustees estimate a cost increase of only 0.01 percent of payroll over 75 years – that represents less than 0.35% of the program’s 75-year shortfall.

Of course, these numbers could be revised since there is much uncertainty around the projections. The same could be said about marriage itself.