Social Security has been around since 1935 and it provides
income to around 63 million Americans, 42.5 million of whom are receiving
The program is largely credited with keeping generations of
seniors out of poverty -- but while millions of Americans rely on Social
Security to provide at least half their income, most of us don't really
understand much about the program.
To give you a little more insight into Social Security,
check out these 22 stats -- many of which are likely to shock you.
Americans don't have much confidence in Social
The majority of Americans have serious doubts about the
future of Social Security, even though the program receives broad support and
will be able to pay out most benefits for the foreseeable future -- even if no
changes are made.
- 75% of
Americans believe Social Security won't be available when they retire.
Specifically, almost one-quarter of all Americans think it's not
at all likely they'll get a dime of the benefits they've earned,
while 51% think it's only somewhat likely Social Security will provide
- 77% of
Americans don't think the government will do the right thing to ensure
they'll be able to have financial security in retirement. Only 23% are
somewhat or very confident they'll be able to count on Uncle Sam.
- 64% of
current workers don't believe Social Security is likely to be a major
source of income in retirement; a surprisingly low number given that
around 1 in 5 American workers have no retirement savings at all.
- 73% of
seniors responding to a 2017 poll supported increasing Social Security
taxes, while less than a quarter expressed support for raising the
- 75% of
current benefits will still be payable in 2034, when the Social Security
trust fund is projected to run short. Retirees should expect to receive at
least three-quarters of current benefits through 2092.
Politicians don't generally cut programs with such broad
support, especially when much of that support comes from seniors, who are one
of the most reliable voting blocks. In short, Social Security is probably safer
than you think.
But we're over confident in how long we'll be
able to work
While underestimating the longevity of Social Security,
Americans are overestimating the length of their working life.
- 70% of
current workers think they'll claim Social Security benefits at age 65 or
- 61% of
Americans think they'll need to work past 65 because Social Security won't
pay enough to take care of their needs. They're correct that you can't live on Social Security alone, but are overly
optimistic on how long they'll be able to put off claiming benefits.
- 43% of
current retirees claimed benefits at 65 or later. But the median age at
which workers claimed benefits was 62 in 2017 and 63 in 2018.
- 30% is
the amount by which your monthly Social Security benefit will be reduced. if
you claim at 62 when you're supposed to retire at 67.
- 24% is
the amount by which your monthly benefits will increase if you claim at 70
when you're supposed to claim at 67.
Working longer and delaying your claim for benefits results
in higher monthly income. If you're forced out of the workforce early, it's
best to have savings to support you so you aren't forced into claiming Social
Security. You should also look into whether you could potentially qualify
for Social Security Disability rather than claiming
retirement benefits right away.
And over confident in how much benefits cover
Americans also think Social Security will provide more of
their income than it will -- and they're significantly underestimating how much
of their benefit is likely to go to healthcare expenditures.
- 53% of
future retirees think Social Security will pay for a least half their
retirement expenses. An even larger share of recent retirees -- 6 in 10 --
think at least half their necessary costs will be covered by Social
- 40% of
pre-retirement income is the amount of income Social Security benefits are
actually designed to replace.
- 64% of
the average monthly benefit for a senior claiming Social Security at 62
could be spent on healthcare costs.
- 20% is
the amount of their benefits future retirees expect will go toward paying
- 5.5% is
the expected annual increase in healthcare costs from 2017 to 2027. Social
Security cost-of-living increases are projected to be just 2.6% annually
-- and may be lower, as there were COLAs under 2% in four out of five
years between 2012 and 2016.
It's important to have money set aside for healthcare, as
married couples may need as much as $370,000 to cover the costs of care as a senior. You also
need to supplement Social Security with savings.
We're also not sure how benefits work
Although Social Security is an important source of income,
most people close to retirement age don't understand how it works or have plans
to maximize their benefits.
of pre-retirees claim to know how Social Security
works. But actual data shows big gaps in their knowledge.
- 91% of
Americans 50 and older don't know what factors determine the maximum
amount of Social Security benefits they'll be able to receive.
- 86% of
pre-retirees aged 55 to 61 don't know how much they'll personally receive
in Social Security benefits. Among pre-retirees, 26% had no idea at all
how much monthly benefits would be -- compared with just 14% who were
aware of the amount they'd receive.
- 74% of
pre-retirees don't know their full retirement age, or the age at which
they can retire to receive their standard benefits.
- 65% of
pre-retirees don't realize you need to apply for Social Security benefits
around three to four months before you want benefits to begin. Almost 1 in
10 pre-retirees actually think the Social Security Administration will
contact them -- which won't happen.
of workers think that if they claim benefits
early, their benefits will go up automatically when reaching full
retirement age. This does not occur, and any reduction in benefits from
filing early lasts throughout retirement.
- 23% of
workers say they've focused on maximizing Social Security benefits when
deciding when to claim their retirement income from the SSA. That means
nearly 8 in 10 of us don't make strategic choices about a primary source
of retirement income.
Social Security benefits are almost assuredly going to be
around, at least in some form, when you retire -- no matter how old you are
when reading this. Now's the time to start learning how to maximize them.
Now you know a lot more than most Americans about Social
Hopefully, these stats will inspire you to save more and be
smarter about how you claim Social Security so you can maximize benefits
without relying too much on this income to fund your retirement.
The $16,728 Social Security bonus most retirees
completely overlook If you're like most Americans, you're a
few years (or more) behind on your retirement savings. But a handful of
little-known "Social Security secrets" could help ensure a boost in
your retirement income. For example: one easy trick could pay you as much as
$16,728 more... each year! Once you learn how to maximize your Social Security
benefits, we think you could retire confidently with the peace of mind we're
here for the original article from Fox Business.