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May 02, 2023 at 05:13 PM
Sixty-nine percent of Americans approaching retirement failed or eked out a passing grade in the most recent Social Security retirement benefits quiz from Massachusetts Mutual Life Insurance Co., the results of which were released Tuesday. The results indicate that near-retirees’ knowledge about Social Security benefits is lower than it was in 2022.
“There are two key things to remember when it comes to retirement: Knowledge is power and planning is powerful,” Paul LaPiana, head of product with MassMutual, said in a statement.
On that basis, many workers near retirement are in bad shape. Thirty-five percent of test takers failed this year’s quiz, up from 29% last year, and 34% barely passed with a grade of D, down from 36% in 2022.
“For those nearing retirement, the questions you need to ask yourself are, ‘Where is my income going to come from, and what do I need to do to ensure that I do not leave anything on the table?’ LaPiana said.
In terms of retirement planning, the survey found that 43% of respondents did not know what percentage of their retirement income would come from Social Security. A further 28% did not know how much money in addition to Social Security they would need to live comfortably in retirement.
Only 28% said their retirement income plans take into account inflation and market volatility. Twenty-six percent said their plan did not do so, 25% hoped it did and 21% just did not know. Sixteen percent also did not know how exposed they are to stock market fluctuations in retirement.
“With Social Security and all of your other retirement income streams, know the nuances, LaPiana said. “Carefully plan. And make decisions on purpose and not by accident.”
An encouraging 24% of respondents reported that they had documented all their financial information and online usernames and passwords in one place as part of their estate plans, and 54% said they planned to do so.
But 22% had not done this, and did not plan to do so.
PSB Insights conducted the online survey on behalf of MassMutual from March 31 to April 5 among 1,500 Americans nearing retirement, ages 55 to 65, who have not filed for Social Security retirement benefits.
On the quiz itself, most respondents correctly answered questions about receiving reduced benefits by filing early, and receiving reduced benefits by continuing to work after filing early for retirement. A majority also correctly understood that a married person can receive benefits based on his or her spouse’s record even if that person has no individual earnings history.
But it was downhill from there. See the gallery for the 10 questions on which respondents gave the fewest correct answers.
(Image: Shutterstock)
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