Social Insecurity: Many Don't Understand Benefits

Many Americans misunderstand how Social Security works, a survey found.

Nearly three-fourths (72%) say Social Security benefits make up half or more of their retirement income, which exceeds the national average of 65%, reported by the Social Security Administration, according to a study released by the Bankers Life and Casualty Company Center for a Secure Retirement. Twenty-nine percent count on Social Security for 75% or more of their retirement income. One in ten relies on Social Security for all of their retirement income.  

The Longevity Risk and Reward for Middle-Income Americans study, which focused on 500 Americans ages 55 to 75 with an annual household income between $25,000 and $75,000, found one in three (34%) do not understand that delaying when they start to collect Social Security benefits can increase their future benefit amount. In addition, nearly half (47%) incorrectly believe an annual cost-of-living increase to their Social Security benefits is guaranteed, and 36% falsely believe full Social Security benefits start with their 65th birthday.  

The survey found some middle-income Americans are also not paying attention to their individual Social Security statements. One in three (35%) middle-income Americans age 55 and older who are not yet receiving Social Security do not know what their monthly benefit amount will be when they retire.


Nearly eight in ten (78%) middle-income Americans age 55 and older say they are concerned about the future of Social Security. Thirty-eight percent do not believe Social Security as we know it will exist in 20 years.    

The majority (67%) of respondents said they are unsure the federal government will fix the Social Security system in their lifetime. One-fifth (20%) believe the government will fix the system, while 13% feel Social Security is not broken and should remain untouched.  

Proposed changes to the current system do not provide middle-income Americans older than age 55 with optimism; more than half (56%) do not think changes or reforms to the current Social Security program will benefit them.