But despite the ubiquitous nature of the program, a majority of Americans are sorely lacking when it comes to critical knowledge about Social Security benefits.
According to Nationwide’s 8th Annual Social Security Consumer Survey, which was conducted by the Harris Poll on behalf of the Nationwide Retirement Institute, it found that only 6 percent actually understand all the factors that determine the maximum Social Security benefit an eligible individual can receive.
“It’s indisputable that Americans across all generations need more Social Security education,” Tina Ambrozy, senior vice president of Strategic Customer Solutions at Nationwide, noted in a 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,” she continued.
Shortcomings in Several Categories
Here are some of the highlights of the survey: Nearly 40 percent of respondents don’t know the eligible age to receive full benefits; about half of Social Security beneficiaries don’t possess a clear sense of how much money they will receive in Social Security income; 30 percent of respondents don’t know that Social Security may offer benefits for spouses and children; 37 percent incorrectly believe that Social Security benefits are not protected against inflation; and nearly half mistakenly believe that if they claim Social Security benefits early, their benefits will adjust automatically when reaching full retirement age, which is currently sixty-six and two months.
Despite lacking critical knowledge about the program for the most part, Nationwide also discovered that many Americans want to see particular reforms in the Social Security program.
For example, most do believe that Social Security’s cost of living adjustment (COLA) should be raised annually but a majority also feel that the boosts in payments should only target low- and middle-income households. The poll also revealed that the majority of senior citizens are fully in favor of taxing the wealthy to better fund the Social Security program for the future.
The report also shed light on the respondents’ doubts that the Social Security program will even be around when it is their turn to retire. In fact, more than 70 percent of those individuals twenty-five and older are concerned about the Social Security program running out of money during their lifetime. Moreover, nearly half of millennials believe that they “will not get a dime of the Social Security benefits they have earned.”
Ethen Kim Lieser is a Washington state-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn.