A Teachable Moment about Social Security Benefits
Reading Time: 2 MinutesLast Updated: November 6, 2023
It appears we have a knowledge gap among younger workers when it comes to Social Security. Recent analysis from the nonpartisan Employee Benefit Research Institute (EBRI) shows a quarter of younger workers believe that Social Security will not be part of their income in retirement. This compares with 13% of those over 45 who believe the same thing.
Younger men are more likely (29%) than younger women (21%) to say Social Security will not be an income source in retirement. And 41% of the nonbelievers have talked with a professional financial advisor about retirement planning, suggesting there are advisors out there who are discounting Social Security, too.
Younger workers who have estimated their Social Security benefit are more likely to believe it will be a source of income in retirement (28%) than those who haven’t (20%).
It appears we have a ‘teachable moment.’ For the average worker, Social Security may replace about 40% of preretirement income. It’s important to factor this benefit into their retirement planning. Think about how much of an impact 40% can have. If you’re training for a marathon, would you want to run 36.5 miles? Or stick with 26.2, which is 40% less of a trek. When you’re figuring out how much you need to save for retirement, isn’t it good to know that about 40% of your goal is automatically covered?
An easy way for workers to understand the role Social Security will play in their retirement is to go online to create a free my Social Security account today and get an estimate of future benefits.
Some of the knowledge gap may instead be a confidence gap. Under the intermediate assumptions of the 2014 Trustees Report, Social Security will be unable to pay full retirement benefits starting in 2033. If nothing is done by our lawmakers, benefits will be cut by about a quarter after 2033. Closing the funding gap would also likely help close the confidence gap.
Kathy Stokes is a communications consultant. She is the director of the American Savings Education Council, a national coalition of private and public sector institutions committed to making retirement planning and saving a priority for all Americans. ASEC is a program of the EBRI Education and Research Fund.
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Tags: retirement, social security, Social Security benefits, SSA
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Kathy Stokes, Director, American Savings Education Council
Director, American Savings Education Council
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Priscilla A.
Will my 403b be considered a pension? How about a 401K? If I roll these into an IRA upon retirement, will I need to report them as a pension?
Christopher N.
How do I apply for the ‘silver sneakers’ program to pay for my gym fees?
L.A.
Hi Christopher. Please note that Social Security is not involved in the Silver Sneakers program. It would be best for you to contact your health insurance company to find out about this program. We hope this helps.
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Patricia A.
How do I sign up for Silver Sneakers?
Zoe L.
I am 72 on Medicare. I have my retirement secondary Cigna and thru my husband I have Tricare for Life. I need to exercise so I want to go to a local gym Anytime Fitness on the Silver Sneakers. How to I enroll please?
A.C.
Hi, Zoe. You may also wish to contact your local Medicare SHIP (State Health Insurance Program Coordinator). We hope this helps.
Dorina d.
how can I enroll silver sneakers program? I am 66 years old. I only part a program
Kenneth C.
I cannot find RMD publication 590 in the list. I keep getting state info but not the form needed to figure my withdraw amount.
R.F.
IRS Publication 590-A & Publication 590-B.
Debra B.
Can I collect on my husbands social security benefits when I turn 65 if he is 7 years younger than I am
R.F.
Hello Debra, you may be able to get spouse’s retirement benefits if you are at least 62 years of age and your spouse is receiving retirement or disability benefits. Keep in mind, if you qualify and apply for your own retirement benefits and for benefits as a spouse, we always pay your own benefits first. If your benefits as a spouse are higher than your own retirement benefits, you will get a combination of benefits equaling the higher spouse benefit.
See “Benefits For You As A Spouse for more information“. Thanks!