An October survey conducted by Fidelity Investments tested the retirement IQ of 521 Americans between the ages of 55 and 61.
What Fidelity found is despite two-thirds of participants claiming they were confident in their understanding of Social Security and filing procedures, a majority stumbled on three major concepts.
Among Fidelity’s findings:
- 65% of participants were unaware they had to apply for Social Security three months in advance of receiving their first benefit check — and 9% of participants believed the Social Security Administration would contact them to start the application process at retirement time.
- 74% of respondents did not know their full retirement age.
- 50% of respondents believed an ex-spouse making a benefit claim on their earnings would reduce the amount of their benefits.
Though results from the survey also showed an overall increase in knowledge about other features of Social Security — such as the
benefits of waiting for full retirement age or longer to apply — they still show many Americans nearing or at retirement age aren’t nearly as versed in the ins-and-outs of Social Security as they should be.
Knowing your full retirement age, when you need to apply for your benefits, and how your benefits can affect your spouse (and vice versa) is extremely important for preparing yourself and your family for retirement.
CNBC recommends Americans create a My Social Security online account to and review their benefit statements at least once a year. The Social Security Administration’s website also offers many handy tools to help workers understand how their benefits work and plan for their retirement.