41% of Older Americans Flunk This Social Security Quiz

Nearly 80% of folks nearing retirement know next to nothing about the nation’s Social Security retirement program, a new survey has found.

Among those ages 55 to 65 — characterized as “near-retirees” — 78% failed or barely passed a basic knowledge quiz about Social Security retirement benefits, according to the latest MassMutual Social Security consumer poll. The poll surveyed 1,500 Americans who are nearing retirement but have not yet filed for Social Security retirement benefits.

More than 4 in 10 — 41% — failed the quiz outright, while 37% got a grade of D.

Just 1% of those who took the quiz answered all 13 true/false statements on the quiz correctly to receive an A+.

The following questions from the quiz — and the small percentage of folks who answered correctly — clearly illustrate that near-retirees have some work to do if they are to better understand this important program.

5. Full retirement age

True/false statement: “Under current Social Security law, full retirement age is 65 no matter when you were born.”

Correct answer: False

Respondents who answered correctly: 55%

The reality: Nobody has a full retirement age of 65 anymore. Instead, the full retirement age falls somewhere between 66 and 67, depending on when you were born. It is 67 for anyone born in 1960 or later.

4. Dependents of Social Security recipients

True/false statement: “If I file for retirement benefits and have dependent children age 18 or younger, they also may qualify for Social Security benefits.”

Correct answer: True

Respondents who answered correctly: 53%

The reality: Dependent children of recipients may in fact qualify for benefits on your record. Eligible children include biological children, adopted children and stepchildren. In some cases, a dependent grandchild might qualify.

3. Delaying benefits

True/false statement: “If I delay taking Social Security benefits past the age of 70, I will continue to get delayed retirement credit increases each year I wait.”

Correct answer: False

Respondents who answered correctly: 48%

The reality: You can increase the size of your monthly benefit check by up to 8% for each year you wait past full retirement age to file for Social Security. However, after age 70, there is no benefit to waiting any longer to file, as your monthly check gets no bigger after that point.

2. Taxation of benefits

True/false statement: “Social Security retirement benefits are subject to income tax just like withdrawals from a traditional IRA account.”

Correct answer: False

Respondents who answered correctly: 38%

The reality: Although Mass Mutual dinged people who answered “true” to this question, that isn’t entirely fair. In some situations, Social Security is indeed subject to income tax. But this is only true if what is known as your “combined income” is high enough to move you into that situation.

For more about when Social Security is and is not taxed, check out “7 Ways To Avoid Paying Taxes on Your Social Security Income.”

1. Citizenship

True/false statement: “I must be a U.S. citizen to collect Social Security retirement benefits.”

Correct answer: False

Respondents who answered correctly: 23%

The reality: You do not have to be a U.S. citizen to qualify for Social Security. Instead, a “lawfully present noncitizen” also can receive benefits if they have earned enough work credits, according to the Social Security Administration.

Want to learn more about Social Security? Check out:

• “7 Social Security Rules Everyone Should Know by Now“
• “7 Reasons Not to Take Social Security at Age 62“