A recent study conducted by MassMutual has unveiled a worrying gap in knowledge about Social Security benefits among Americans approaching retirement.
Drawing from an online survey of 1,500 Americans who are between 55 and 65 years old, the research found a significant 78 percent of near-retirees either failed or barely passed a quiz assessing their understanding of basic Social Security concepts.
Compared to 2023, the annual study found a marginal improvement in awareness about spousal, survivor, and divorcee benefits. Three-quarters of respondents (75%) knew that a spouse could receive benefits from their record without having an individual earnings history, slightly more than 72 percent a year ago.
Seventy percent of respondents this year also correctly said that if they were married and their spouse passed away, they wouldn’t automatically receive both their own full benefit and their spouse’s full benefit, compared to 65 percent of last year’s respondents.
But while a majority understood the financial consequences of collecting their benefits early – including 92% who knew their benefits would be reduced – nearly half (45%) did not know what their full retirement age is. Another 52 percent didn't know that their ability to put off receiving their Social Security benefits ends at age 70.
“We have been conducting this quiz with near retirees for the last ten years,” Paul LaPiana, CFP, head of brand, product, and affiliated distribution at MassMutual, said in a statement. “[E]very year, we see similar patterns of confusion when it comes to Social Security retirement benefits."
The research also hints at cracks in Americans’ retirement income and estate planning preparedness.
Two-fifths of near-retirees in MassMutual’s survey expect Social Security to be their primary source of retirement income, eclipsing the anticipated reliance on 401(k)s, 403(b) plans, pensions, and investments.
However, amid broad questions about the long-term sustainability of Social Security, more than a third of respondents (36%) were concerned their Social Security benefits could not be sustained for longer than a decade.
A similar proportion of the poll participants said they have a will (35%) or a medical advance directive (33%). Furthermore, only 29 percent said they have a healthcare power of attorney, and just 22 percent reported having a financial power of attorney.
“The good news is that these individuals have not yet filed for Social Security benefits so they have time to understand the basic facts that can either help or hurt their financial situations in retirement,” LaPiana said.
Eliseo Prisno, a former Merrill advisor, allegedly collected unapproved fees from Filipino clients by secretly accessing their accounts at two separate brokerages.
The Harford, Connecticut-based RIA is expanding into a new market in the mid-Atlantic region while crossing another billion-dollar milestone.
The Wall Street giant's global wealth head says affluent clients are shifting away from America amid growing fallout from President Donald Trump's hardline politics.
Chief economists, advisors, and chief investment officers share their reactions to the June US employment report.
"This shouldn’t be hard to ban, but neither party will do it. So offensive to the people they serve," RIA titan Peter Mallouk said in a post that referenced Nancy Pelosi's reported stock gains.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
