Retirement Income Comes From 6 Places. One Is Still Yours to Build.

New Census figures on where Americans over 65 actually get their money landed this week, and one line in the table is worth more than all the rest put together.

Almost 85% of Americans 65 and older received Social Security in 2025. The median payout was $21,320 for the year. Call it $1,777 a month, before Medicare comes out of it.

Just over 20% had earnings from work. That group had the highest median of any source on the list, $42,430. Read that twice. The best-paying line in the average American retirement is still work.

Almost 3 in 10 received pension income. Pensions ranked third on both reach and size, which means for the people who have one they still out-pay withdrawals from 401(k) and IRA accounts. Fewer than 1 in 5 people over 65 draw from those accounts at all.

Dividends and interest came in smallest by median. Fairly common, especially interest, and nowhere near enough to live on.

The pension line is where it gets interesting

Averages hide the real story, so look at what a pension actually pays depending on who signed it.

• Federal government pension: median $32,500 a year
• State and local government: $24,530
• Military: $24,280
• Company or union pension: $11,290
• Annuities: $7,944

A federal pension pays close to triple what a company pension pays. Same word, same line on the tax return, more than $20,000 a year between them. So when someone says they have a pension, you have learned almost nothing about their income until you know which kind.

That is the quiet lesson of the whole table. Five of these six sources were settled by things that happened years ago. Which employer you had. Whether that employer offered a defined benefit plan. How long you paid in. What your earnings record looked like in your forties.

None of that is available to change now.

The sixth line

There is one source on the list that is not a legacy decision, and the Census files it under earnings.

A business you own is earnings. So is a stream that pays you for work you already did. The reason that line carries the highest median of the six is not that older people land great jobs. It is that active income is worth more per year than a 4% draw on a small balance, and always has been.

The difference between clocking in and owning something is who holds the switch. A part-time job pays until your body or a manager decides otherwise. A stream you built keeps paying on the days you do nothing.

I retired at 55 in 2022 with four things in that last category: rentals, oil and gas royalties, the apps I build, and a couple of small online businesses. Not one of them started large. Each started as an experiment I ran while a paycheck was still covering the learning curve.

Five of your six income sources are already written. The sixth is the only one still taking edits.

What to do with this

Take the list of six and mark the ones that will actually be yours. Most people find they have two, maybe three. Then put a monthly figure next to each and add them up.

If the total falls short of what you spend, the fix is not on lines 1 through 5. It is on the sixth one.

The free Retirement Income Blueprint walks through how to pick a first one: https://retireready247.com

-Rich

I am not a financial advisor and nothing here is financial advice. The figures above are medians from Census data, not predictions about you, and results vary.