Filing for Social Security? Only 4% Get it Right!

David Maynard |

Social Security: Only 4% Get It Right, Costing Average Household $111,000

Studies find most of us misunderstand Social Security. After all, there are roughly 2700 rules regarding Social Security, so it makes sense that many find it complicated. Not understanding how to maximize benefits, though, could cost you a lot of money in retirement.

Recent surveys on consumer knowledge about Social Security found that:

  • Fewer than one quarter of older adults know their full retirement benefit age.
  • 7 out of 10 believe they are eligible for benefits before they actually are eligible to file.
  • More than half say they know exactly how to maximize benefits; but only 8% were able to identify the factors that determine a maximum benefit.
  • Only 4% file correctly to maximize their benefit.
  • Nearly half are not aware that Social Security offers guaranteed income for life.
  • 4 in 10 are unaware that upon a spouse’s death, the higher benefit is inherited by the surviving spouse.
  • 6 in 10 don’t know that benefits are protected against inflation.
  • 4 in 10 don’t know that divorced spouses may be eligible for benefits based on an ex-spouse’s record.
  • Future retirees anticipate collecting 28% more in monthly benefits than current retirees actually receive.
  • Average household misses out on $111,000 of income by claiming at sub-optimal time.
  • About 21% of those at risk of not affording retirement would see an improvement in their chances if they claimed Social Security at the optimal time.
  • Retirees working with a financial advisor report receiving 17% more in benefits than those who do not - $1,551 vs. $1,324.

If want to learn more about Social Security – ask an expert. Elizabeth Swanson, Social Security Planning Manager, worked for the Social Security Administration for 12 years and knows how it works. Find us, and other resources, at maynardwealth.com.

Sources: Nationwide Retirement Institute survey conducted by The Harris Poll and Capital One White Paper