If you are like most Americans, two things are probably true about your relationship with Social Security:
- The program itself will provide crucial financial support during your golden years.
- You know a lot less about Social Security than you should.
Recently, Allianz Life Insurance Co. of North America surveyed 1,000 U.S. adults ages 25 and older as part of the firm’s latest annual retirement study. Respondents either had investable assets of at least $150,000 or incomes of $50,000 for single individuals or $75,000 for partnered couples.
During the survey, Allianz asked respondents a few questions about Social Security. The respondents’ answers suggested that the majority of adults have some major holes in their knowledge about the program and how it fits into their lives.
Here are some examples.
1. Most don’t know how it fits into their retirement plan
More than half of respondents — 53% — say they don’t know much about the Social Security program or how it fits into plans for their golden years. This is especially true of millennials (60%) and members of Generation X (51%).
Some Americans are likely to be more dependent on Social Security income than others. If you have little in the way of retirement savings, check out “8 Essential Moves for Retiring Comfortably on Social Security Alone.”
2. Most are unsure of the best time to claim benefits
Choosing the optimal time to file for Social Security is one of the biggest challenges you will face in retirement. As it stands, 53% of survey respondents said they simply aren’t sure when they should begin taking benefits.
There is no one-size-fits-all answer here. For many people, it pays to wait, as we discuss in “7 Reasons Not to Take Social Security at Age 62.”
However, that’s not true for everybody. Some folks should consider claiming sooner rather than later. For more, check out “5 Groups Who Are Better off Claiming Social Security Early.”
3. Many plan to work past their Social Security retirement age
Whether it’s due to their lack of knowledge about Social Security or for some other reason, many Americans say they plan to work past their Social Security retirement age. This is true of:
- 41% of millennials
- 38% of Gen Xers
Yet, in real life, few people actually work for that long, according to Allianz.
Given this truth, it might be good to create a pair of Social Security strategies: One that hinges on the hope that you will be healthy enough to work later into life and one that plans for an earlier-than-expected retirement.
Learn more about Social Security
Confused about Social Security? Join the club.
Navigating the nation’s major retirement program can be challenging, but it’s important to make the right decisions about your benefits. To get a start on your strategy, read “.”
And for more about how to avoid key errors, check out “Financial Advisers Say These Are the Top 10 Retirement Planning Mistakes.”
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