Struggling to Understand Social Security

Yesterday I reported that the 2012 Retirement Confidence Survey found that more Americans report Social Security is an important part of their retirement income security. Yet, most older Americans are remarkably unfamiliar with the program and how the decisions they make can dramatically change the their lifetime income and that of their spouses. This an area we’ve known about for a long time and cover in detail regularly in Retirement Watch. It’s such an important topic that I’ve also prepared a report on the topic, Secrets of Boosting Social Security Benefits, that covers many of the key strategies few people are aware of. If you aren’t already receiving Social Security retirement benefits, study the topic. Otherwise, you’ll probably be leaving tens of thousands of dollars on the table.

The report, from AARP, is the second in two years in which the Washington-based group has measured Americans’ familiarity with the Social Security program. The study – “The Impact of Claiming Age on Monthly Social Security Retirement Benefits: How Knowledgeable Are Future Beneficiaries?” – should be required reading for everyone age 50 and older who has yet to interact with the program.

Indeed, the report notes that a clear understanding of so-called claiming strategies is more important than ever, given increasing life expectancies, the demise of traditional pension plans, and the toll that the recession has taken on other sources of retirement income.