6 Social Security Myths That Many Americans Believe

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Many retirees rely on Social Security for income, but even basic concepts about the government program are frequently misunderstood.

According to the Nationwide Retirement Institute’s 8th Annual Social Security Consumer Survey, nearly 90% of American adults are at least somewhat confident in their knowledge of Social Security.

Despite this, the survey finds that many Americans are unaware of their eligibility age, how payments are calculated, and other important details.

In April and May 2021, the Nationwide Retirement Institute polled nearly 2000 Americans aged 25 and up to reach its conclusions.

Here are a few of the misconceptions about Social Security that many people have.

Maximum advantages

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While 54% of Americans who have not yet received Social Security benefits believe they know how to maximize their benefits, this belief may be unfounded.

Only 6% of people could name all of the variables that go into determining a person’s maximum benefit.

According to the IRS, those factors are as follows:

  • Your earnings have been indexed over time to reflect changes in average earnings.
  • When you start claiming Social Security early, either at full retirement age or after it has been deferred,
  • Cost-of-living adjustments begin at the age of 62, whether or not you are receiving benefits.
  • Whether or not you have a pension from a government job

Child and spousal benefits


Spousal and child benefits are important features of the Social Security program, but it appears that 30% of Americans are unaware of their existence.

Spouses and dependents can claim benefits from a person’s Social Security record in a variety of situations.The details can be found in 7 Social Security Benefits You Might Be Ignoring.

Protection against inflation

Man looking at inflation

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Inflation raises the price of goods and services over time, and Social Security provides inflation protection through annual cost-of-living adjustments.

COLAs, or cost-of-living adjustments, are based on the federal Consumer Price Index for Urban Wage Earners and Clerical Workers.In 2021, Social Security recipients will receive a 1 percent increase.Some predict that the COLA for 2022 will be the largest in a decade, with a 3% increase in benefits.

Despite all of the attention paid to these annual increases, according to the Nationwide Retirement Institute, 37% of Americans are unaware that Social Security provides inflation protection.

Age of eligibility


When are you eligible for full Social Security retirement benefits? That depends on when you were born, according to 39% of respondents in Nationwide’s 8th Annual Social Security Consumer Survey.

At the age of 62, anyone who is eligible for Social Security benefits can begin claiming benefits.However, if you do, your monthly payments may be reduced by up to 30%.You must wait until you reach full retirement age to receive the full amount.This is based on the year you were born.

  • If you were born between 1943 and 1954, your full retirement age is 66.
  • In 1955, I was 66 years old and 2 months old.
  • 1956, I was 66 years old and 4 months old.
  • In 1957, I was 66 years old and 6 months old.
  • In 1958, I was 66 years old and 8 months old.
  • 1959, at the age of 66 and ten months
  • 1960 and subsequent years 67

After early payments, there will be no adjustments.


Nearly half of all Americans – 45% – believe that claiming Social Security benefits early will increase their monthly payments when they reach full retirement age.

That is not the case.

If you choose to begin benefits before reaching full retirement age, your monthly checks will have a lower base amount than if you had waited.Although continuing to work may increase it, that lower base is usually permanent.

You will receive annual COLA increases regardless of your age when you claim benefits.

Amount of payment

A senior couple stressed about Social Security

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If you don’t know how much money you’ll have in retirement, it’s difficult to plan properly.51% of those who have not yet begun receiving benefits have no idea how much their Social Security payments will be.

While the amount of your benefit won’t be finalized until you’ve finished working, it’s simple to figure out how much you’ll get.To see a history of your earnings and an estimate of benefits at full retirement age, create a my Social Security account on the Social Security Administration website.

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