Quick Quiz: True or False – Social Security retirement benefits are subject to income tax, just like withdrawals from a traditional IRA account.
If you answered “False”, you are smarter than more than 60% of your fellow Americans nearing retirement. In fact, if you know almost anything about how Social Security works, you’re most likely smarter than almost 70% of people nearing retirement age when it comes to understanding one of your main sources of retirement income.
These are the results of the 2023 Quiz on Social Security Retirement Benefits for Near-Retirees from the Massachusetts Mutual Life Insurance Co. Of the 1,500 people ages 55 to 65 who took the quiz, 69% failed or barely managed to pass all 13 questions. survey (published in full below). And only 1% managed to answer all the questions correctly.
For practical help understanding Social Security, consider matching with a licensed financial advisor for free.
Even more worrying is the fact that more people failed the quiz this year than last, with a third (35%) answering six or more questions incorrectly compared to 29% last year.
“One of the most concerning findings is that 43% of near-retirees don’t know what percentage of their retirement income will come from Social Security benefits,” said Paul LaPiana, CFP, product manager at MassMutual. “Knowing your total retirement income and where it will come from is one of the basics of retirement planning.
If you’re ready to be matched with local advisors who can help you achieve your financial goals, start now.
How do you stack? Try the True or False quiz and see for yourself — and you’re even ahead of #12 for single filers and $32,000 for joint filers.)
MassMutual Quiz on Social Security Retirement Benefits 2023
In most cases, if I receive benefits before full retirement age, they will be reduced for early reporting.
If I receive benefits before full retirement age and continue to work, my benefits may be reduced depending on my earnings.
If I have a spouse, he can receive benefits from my file even if he does not have an individual income history.
Generally, if I’m in a same-sex marriage, the eligibility requirements are different for Social Security retirement benefits.
If I have a spouse and he dies, I will receive both my full benefits and those of my deceased spouse.
The money that comes out of my Social Security paycheck goes into a specific account for me and stays there, earning interest, until I start collecting Social Security benefits.
If I apply for retirement benefits and have dependent children age 18 or younger, they may also be eligible for Social Security benefits.
If I divorce, I may be able to collect Social Security benefits based on my ex-spouse’s Social Security earnings.
Under current law, Social Security benefits could be cut by 20% or more for everyone by 2035.
Under current social security law, the full retirement age is 65, regardless of your date of birth.
If I delay my Social Security benefits beyond age 70, I will continue to receive Deferred Retirement Credit increases each year that I expect.
Social Security retirement benefits are subject to income tax, just like withdrawals from a traditional IRA account.
I must be a US citizen to receive Social Security retirement benefits.
Answers: 1. true; 2. true; 3. true; 4. false; 5. false; 6. false; 7. true; 8. true; 9. true; 10. false; 11. false; 12. false; 13. false.
Notes: 0-1 false A; 2 fake Bs; 3 false C; 4-5 false Ds; 6 or more wrong F.
At the end of the line
Social Security is more complicated than simply waiting until full retirement age to claim a check. The question of when to claim benefits, how to claim them, and how to incorporate Social Security into your overall retirement plan can be complicated. There are actually 81 separate ways for a married couple to apply for benefits. One way to start figuring it all out is to check out SmartAsset’s Social Security Calculator. It may also be beneficial to partner with a licensed financial advisor for free.
Tips for managing your retirement plans
How much money will you need to save to be able to retire? Should we delay Social Security? These are just a few questions pre-retirees face. A financial adviser can help you answer them. Finding a financial advisor doesn’t have to be difficult. SmartAsset’s free tool connects you with up to three vetted financial advisors who serve your area, and you can interview your advisors for free to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, start now.
Fidelity recommends that you have 10 times your annual income saved for retirement before age 67. To find out if you’re on the right track, try SmartAsset’s retirement calculator. This free tool will allow you to estimate the amount you will have when you retire.
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Can you pass this Social Security quiz? Nearly 7 in 10 people struggling with these basic questions appeared first on the SmartAsset blog.