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One in 3 Americans says they don’t believe Social Security will be around when they turn 65, according to a new Ramsey Solutions report. While that fear is understandable, it’s not the full picture.
Social Security isn’t a company that can “go bankrupt.” Even if Congress does nothing, payroll taxes would still cover most benefits with reductions (not a total shutdown) starting in the 2030s.
We break down the most common fears we hear when it comes to Social Security, the reality behind them — and why the system is stronger than you might think.
Fear No. 1: “Social Security is going broke”
The talk: Social Security trust funds are “running out,” so future retirees won’t get a dime.
The reality: Social Security is largely pay as you go: today’s workers fund today’s retirees. The Old Age and Survivor Insurance (OASI) trust fund, which pays benefits to retirees and survivors, is projected to pay full benefits until 2033.
After that, if Congress does nothing, the money coming in from payroll taxes would still cover roughly 77% of promised benefits. For example, a $2,000 monthly benefit might drop to about $1,540.
Social Security has faced funding gaps before in the late 1970s and early 1980s, and lawmakers stepped in with fixes to keep the program going. The hope is that they’ll make adjustments again before cuts take effect.
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Fear No. 2: “You should plan as if Social Security won’t exist”
The talk: Experts warn that Social Security’s shaky future means you shouldn’t count on it at all.
The reality: The data says Social Security is very unlikely to disappear. Even if the trust funds run short in the 2030s, payroll taxes would still cover around three-quarters of scheduled benefits. That’s far from nothing.
Still, there’s wisdom in taking a cautious approach. If you build your retirement plan so you could get by without Social Security, you’re giving yourself a safety net twice over:
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You’ll be prepared if benefits are reduced, and
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You’ll be pleasantly surprised if you end up getting the full amount.
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Fear No. 3: “I didn’t work long enough to qualify”
The talk: If you don’t have decades of steady work under your belt, you might assume you won’t see a penny from Social Security.
The reality: The bar is much lower than many people think. You need only 40 work credits — or about 10 years of work — to qualify for retirement benefits. And those credits don’t have to be earned in back-to-back years or in a single career.
Even part-time or lower-wage jobs count toward your total. So unless you spent nearly your entire adult life outside the workforce, chances are you’ve already cleared the threshold.
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Fear No. 4: “I won’t be able to navigate the bureaucracy of claiming Social Security”
The talk: Social Security is a giant government program, so it’s easy to assume claiming benefits will be a maze of paperwork, confusing rules and long lines at the SSA office.
The reality: It’s not as painful as it used to be. The Social Security Administration has rolled out online tools that make the process far easier.
You can create a free My Social Security account to see your earnings history, estimate your future benefit, and even apply for retirement online. Most people never have to step foot in an office.
And while there can still be hold times, the system is much more accessible today than it was even a decade ago.
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Fear No. 5: “Working after claiming Social Security isn’t worth it”
The talk: If you keep working after filing for Social Security, your benefits will get slashed or taken away.
The reality: The earnings test does reduce benefits if you claim before your full retirement age (currently 66 to 67, depending on your birth year).
But here’s the part many people miss: Once you reach full retirement age, those reductions stop, and your benefit is recalculated to give you credit for the months you had money withheld. In other words, you don’t lose those dollars forever.
On top of that, continuing to work can increase your benefit down the road. Social Security bases your monthly check on your highest 35 years of earnings. If your recent salary is higher than earlier years, those new numbers can replace older, lower-earning years in the formula, which boosts your benefit for life.
So if you enjoy your job or want the extra income, working after claiming can still be well worth it.
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Bottom line: Is Social Security really going bankrupt?
Social Security isn’t perfect. And, yes, it faces real funding challenges in the years ahead. But the program isn’t about to vanish.
Social Security has faced such crises before — notably in 1977 and again in 1983, when benefits and requirements were adjusted to keep the program solvent.
The smartest move? Plan conservatively, as if you could retire without it, while also recognizing that it’s likely to be there in some form. That way, any Social Security income you receive becomes added security, not the sole pillar holding up your retirement.
Instead of letting the headlines keep you up at night, focus on what’s in your control: saving steadily, understanding your claiming options and building flexibility into your retirement plan. That combination will carry you through retirement more than fear.
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About the writer
Cassidy Horton is a finance writer who specializes in banking, insurance, lending and paying down debt. Her expertise has been featured in NerdWallet, Forbes, MarketWatch, CNN, USA Today, Money, The Balance and Consumer Affairs, among other top financial publications. Cassidy first became interested in personal finance after paying off $18,000 in debt in 10 months of graduation with an MBA. Today, she’s committed to empowering people to stand up and take charge of their financial futures.
Edited by Kelly Suzan Waggoner
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