In 2025, Social Security will celebrate its 90th birthday. New research from AARP indicates that despite Social Security’s central role in American life, most Americans don’t really get the program. That’s why it’s encouraging that ninety-six percent of respondents understand how critical Social Security is. Confidence in the program is down by 7 percentage points from five years ago. The current confidence level is 36% in 2025, a drop from 43% in 2020.
Social Security’s Board of Trustees project that the program’s combined trust funds will stay solvent until 2034. The program would still be able to cover 81% of scheduled benefits. This looming deadline raises questions about the future of benefits for millions of Americans who rely on Social Security for retirement income.
In a survey conducted by AARP, 74% of respondents claimed they are somewhat to very informed about how Social Security operates. However, their data indicates some confusion about fundamental principles of the system. Just 34% of survey-takers understood that once the trust funds run out, benefits will be paid at a lower rate. This myth speaks to a larger chasm of awareness. Further, 41% of Americans were unaware of the youngest age at which one could claim Social Security benefits. At the same time, two-thirds didn’t know the age at which they’d get the most out of those benefits.
Wow us with attachments to the first Social Security Act, signed by President Franklin Delano Roosevelt into law on August 14, 1935. This successful pilot program was subsequently made permanent. It was meant to provide a regular income to seniors and disabled Americans. Over the past two years, this program has become an essential safety net for millions of Americans.
Not only are Americans overall down on Social Security, but understandably, Americans younger than 30 were the most skeptical about the program’s likelihood to succeed. Bill Sweeney noted, “Some of this could be that younger people just haven’t experienced Social Security yet and don’t understand how the program works.” This unfamiliarity might explain their confusion about the benefits they will receive going forward.
At full retirement age, typically between ages 66 and 67, retirees can expect to receive 100% of the benefits they have earned. For those who decide to file early, there are penalties. For the average beneficiary who claims their $1,000 monthly benefit at age 62 instead of 67, they are receiving just $700. With this amendment, their payments drop by 30%.
Strategic timing can also work to the advantage of prospective beneficiaries. If you wait until age 70 to file your claim, you’ll get a compounded 8% increase in benefits for every year you wait. The boost persistently accrues each year until you turn that age. This feature may have more profound effects on retirees’ wallet, particularly as they seek safe harbor from an unpredictable economy.
While there are real challenges ahead for Social Security, as Myechia Minter-Jordan reminds us, there’s a reason it became the bedrock of American retirement planning. She stated, “We can’t afford for politicians to play games with the future of Social Security, and we’ll fight as hard and as long as we need to ensure that Social Security remains the economic bedrock of retirement for generations to come.”
Regardless of whether the trust funds are exhausted, payroll tax contributions to Social Security will continue. It is critical to recognize this persistent support. This reality highlights that despite hearings and hand-wringing about benefit levels, funding will continue to be available through continued contributions.