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Knowledge About Social Security Could Use a Boost, Says Report

Practice Management

Americans are confident about their knowledge of Social Security, says a new report. But their confidence may be a little unwarranted: researchers also found that they know less than they think they do. 

In a recent study, Nationwide Retirement Institute found that while many people are very confident that they know a lot about Social Security, their knowledge actually is short on specifics. 

How confident? In an online survey of 1,931 adults age 25 or older conducted April 19-May 7, 2021, Nationwide found that 89% are at least somewhat confident about their understanding of Social Security. It breaks down in this manner: 

  • 46% somewhat confident
  • 25% confident
  • 18% very confident 

But their confidence level does not square with how much they really know, the researchers found: 

  • 55% are unclear about whether Social Security benefits are tax-free. 
  • 54% don’t know what percentage of their income Social Security will replace.
  • 45% are unaware of the effect on their Social Security benefits of claiming them early. 
  • 16% know the age at which they are eligible for full Social Security benefits. 

Dispelling the Fog

An answer to ameliorate that uncertainty, says Nationwide, is increasing Americans’ knowledge of Social Security. They found that there is interest in that: 49% are interested in discussing spousal benefit strategies for Social Security with a financial professional, and 67% are interested in talking with a financial professional about creating ways to have regular income so they can delay claiming Social Security benefits.