So you think you know all you need to know about Social Security? If so, congratulations — you are in the minority when it comes to knowledge of the nation’s biggest retirement benefits program.
A new study released by the Nationwide Retirement Institute found that most Americans are sorely lacking in knowledge about the most basic functions of Social Security. The study was based on a survey conducted by The Harris Poll on behalf of the Nationwide Retirement Institute, part of the Nationwide insurance and financial services company.
“It’s indisputable that Americans across all generations need more Social Security education,” Tina Ambrozy, senior vice president of Strategic Customer Solutions at Nationwide, said in a press release. “Unfortunately, failing to close the knowledge gap and correct some of these misconceptions can have costly repercussions. Financial professionals must help their clients understand this bedrock of retirement security in America and plan properly to maximize their Social Security benefit.”
Here are five things most Americans don’t know about Social Security:
Eligibility age: Two in five (39%) of respondents don’t know the eligible age to receive full benefits
Payments: Just more than half of those not already receiving Social Security (51%) don’t have a clear sense of how much they will get in Social Security income
Spousal/child benefits: 30% don’t know that Social Security may offer benefits for spouses and children
Inflation protection: More than a third (37%) incorrectly believe that Social Security benefits are not protected against inflation
No adjustments: 45% mistakenly believe that if they claim benefits early, their benefits will go up automatically when reaching full retirement age, or they don’t know this is false.
The study found that many Americans aren’t educating themselves about Social Security because they don’t think it’ll be around when they’re ready or need to claim their benefits. Seven in 10 adults ages 25 and older worry that the program will run out of money in their lifetimes. This is especially true of millennials (77%) and Gen Xers (83%). But even 61% of baby boomers worry about the same thing.