Tina Ambrozy, senior vice president at Strategic Customer Solutions at Nationwide, believes that people at all career phases can benefit from learning more about the Social Security system and retirement planning. She says problems in social security are due to “a lack of communication.”
That was also what was discovered in a study conducted by the Harris Group on behalf of Nationwide. The insurer and pollster found a shocking lack of understanding about Social Security among Americans who stand to profit from it. But according to the survey, the taxpayers, not the agency, are at fault.
Harris polled nearly 2,000 respondents to assess Americans’ understanding of Social Security benefits. Sixty-eight percent of Americans, for instance, are unaware that Social Security is inflation-protected. Since the administration informs beneficiaries each year that their benefits have increased owing to inflation, you should be aware of this if you are receiving benefits.
It recommended that the administration reorganize its communications division in light of the general lack of understanding of the very foundations of the system, given that, at least theoretically, Social Security benefits would eventually reach all of the people surveyed.
Here’s what they found out:
• Nearly half (49%) of adults don’t know or are unsure what percentage of their income will be replaced by Social Security in retirement.
• According to the pollsters, less than 10% of respondents could name “all the stated elements that influence the maximum social security benefit someone can receive.”
• 44% of those who are not already receiving Social Security are unsure of the amount of their monthly Social Security benefits.
• Just 13% of adults who guessed their full retirement age based on their birth year were correct.
• 49% wrongly think their benefits will increase automatically if they apply for benefits before reaching full retirement age.
What’s alarming about this is that everyone entitled to Social Security benefits might learn the answers to these and other questions by simply entering into their own Social Security account. Nearly every city, regardless of size, has a local office you may phone or visit. Helplines are widely advertised.
But despite knowing little about them, people make judgments based on what they think, not facts.
Other results of the poll include:
• 26% of boomers not currently receiving Social Security payments want to file for benefits early while continuing to work.
• Of the baby boomers not already receiving Social Security, 39% intend to start receiving payments before reaching full retirement age.
As long as you know the consequences, there is nothing wrong with doing either. Again, you might get the knowledge you need to make a wiser choice by speaking with a financial expert or contacting SS.
The survey also discovered a lot of doubt regarding the Social Security system’s viability. “Across all generations, most consumers (70%) are concerned that Social Security will run out of money during their lifetime. The researchers found that 33% of adults think they won’t receive any of their earnings when they retire.
In the survey, people were also asked about the current status of the economy, which is more erratic than it has been in more than ten years.
The survey also found that “Americans across generations are changing their daily routines and canceling or postponing life events due to inflation in the past 12 months.” People go out to eat less, drive less, delay trips, and delay vehicle purchases.
Two-thirds of Americans (66%) worry more now than they did before about their retirement income due to the pandemic’s ongoing financial effects, increased market volatility, and high inflation.
Tina Ambrozy, however, suggests that customers could alleviate some of their worries by learning more about Social Security.
Given the current economic climate, she thinks it is logical that individuals are concerned about retirement. People at all phases of their employment can profit from becoming knowledgeable about the Social Security system and retirement planning, and a reputable financial expert can assist with that education. Alternatively, speak with the Social Security Administration in your locality.
Contact Information:
Email: [email protected]
Phone: 9143022300
Bio:
My name is Kevin Wirth and I have worked in the financial services industry for many years and I specialize in life insurance and retirement planning for individuals and small business owners, with a specialty in working with Federal Employees. I am also AHIP certified to work with individuals on their Medicare planning. You can contact me by e-mail or phone. I look forward to the opportunity of working with you on these most relevant areas of financial planning.
[email protected]
914-302-2300
Disclosure:
These articles are intended for educational purposes only. Please contact your advisors for legal, accounting or investment advice.
