The Social Security system is quite complex and convoluted, so it should come as no surprise that there are many widespread misconceptions about how it all works.
Baby Boomers generally have a better understanding of Social Security eligibility and payments than younger generations. This is because they have done more research as they are either receiving or closer to receiving payouts. However, there are still a few things that many Boomers are unaware of or don’t fully understand.
Common Social Security Misconceptions Among Boomers
According to a survey conducted by the Harris Poll earlier this year, the vast majority of Baby Boomers aren’t aware of all the factors that influence the maximum benefit they can receive under the Social Security system.
Specifically, 93 percent of Boomers don’t fully understand or aren’t aware of these factors, which compares to 96 percent of Millennials and 94 percent of Generation Xers.
Another point that many Boomers don’t understand is that if they start claiming Social Security benefits early, say a few years before the age of retirement; their benefit payouts won’t automatically increase when they reach the age of full retirement.
Just under 70 percent of Boomers understand this, which is much higher than the percentage of Millennials (45 percent) and Gen Xers (49 percent.) Not knowing this can be quite costly, as you can imagine.
Another common misconception amongst all generations is the age at which you are eligible for full benefits under the Social Security system. Eighty percent of seniors incorrectly identified this age, while 97 percent of Millennials and 90 percent of Generation Xers got this wrong.
What Are Some of These Misconceptions So Widespread?
In some cases, only a fraction of the US adult population aren’t confused or unsure about some points of the Social Security system, which begs the question, why is there so much confusion surrounding Social Security. Ultimately, it comes down to the system being quite complex, with many caveats and factors to take into account.
The fact that specialist Social Security advisors sometimes give out incorrect or incomplete information also doesn’t help, leading to even more confusion.
So, it’s very important that you get your information checked and verified by multiple sources to make sure it’s complete and accurate.
It’s worth putting in the time and effort, as you need this information to make decisions related to claiming Social Security – and getting them wrong can cost you thousands of dollars, if not more.
A Quick Summary
- Many Americans are unsure about many elements of the Social Security system, including things like when they’re eligible for payments and the factors that determine how much money they’re eligible to receive.
- Baby Boomers are generally more knowledgeable and less misinformed on the topic than younger generations.
- This is because they are either already receiving Social Security payments, or are pretty close to doing so, so they’ve conducted more research.
- A lot of the confusion arises from the Social Security system being pretty complex and dependent on individual circumstances.
- Experts giving out incorrect information also leads to more confusion.
- Some of the decisions you make regarding Social Security can have a major impact on your finances, so you make sure you fully understand what you’re eligible to receive and how it all works.
- To make sure you aren’t misinformed, you should try to verify all information from multiple sources before making an important decision related to Social Security.