Social Security...You Got This?

​We all pay into it.  We are all expecting to receive it.  But do we all understand it? Apparently not.  New research from Nationwide Retirement Institute suggests that many Americans have either false expectations as to what they can expect from Social Security or a false reality of their own retirement.

The research has so much data that I can’t possibly cover it all in this blog, but here are just a couple of the more glaring misconceptions:  70% of pre-retirees (those within 10 years of retirement) believe they will be eligible for full benefits at age 63.  Wrong.  And 26% believe that even if they do claim benefits early, that the benefits will rise once they reach full retirement age.  Wrong.

In fact, there are so many things about Social Security that pre-retirees get wrong, it almost makes you wonder what they get right.   They certainly don’t get the amount right.  The vast majority believe they will receive $1,805 per month in Social Security benefits, when the actual number is closer to $1,408 per month.  That a difference of 28%.  That’s a BIG difference.  Many people, for some reason, forget that Medicare is not actually free and that premiums are withheld, on a monthly basis, from the Social Security benefit.  And it can be a meaningful amount.

Is there some hope?  Of course.  It appears from the research that only 22% of pre-retirees have a formal written retirement plan, but that if you work with an advisor the likelihood of increasing your Social Security benefits goes up.  In fact, 76% of those surveyed say that if their advisor did not, or does not, speak to them about maximizing Social Security benefits, they will switch advisors.
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So what should you do?  Make sure you have a good advisor who works with you to put a solid plan together for your retirement.  Are you looking for such an advisor?  Give me a call!