Pop 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’re smarter than more than 60% of your fellow Americans nearing retirement. In fact, if you know anything about how Social Security works, when it comes to figuring out one of your most important sources of retirement income, you’re about the same as about 70% of people nearing retirement age. Might be smarter than that.
Those are the findings of Massachusetts Mutual Life Insurance Company’s 2023 Social Security retirement benefits quiz about retirees. Of the 1,500 people between the ages of 55 and 65 who took the quiz, 69% failed or barely passed the 13-questions. Survey (full details are posted below). And only 1% were able to answer all the questions correctly.
For practical help understanding Social Security, consider contacting a certified financial advisor for free.
Even more worrying is the fact that more people failed the quiz this year than last year, with a third (35%) getting six or more questions wrong, compared to 29% last year.
“One of the most worrying findings was that nearly 43% of retirees do not know what percentage of their income in retirement will come from Social Security benefits,” said Paul Lapiana, CFP, head of product at MassMutual. “Knowing your total retirement income and where it will come from is part of the foundation of retirement planning.”
If you’re ready to connect with local advisors who can help you achieve your financial goals, get started now.
How do you stack up? Try the True or False quiz and see for yourself – and you’ve got an edge on No. 12, too. (Social Security benefits are not subject to any income tax unless you exceed a certain income threshold, which is $25,000 for single tax filers, and $32,000 for joint tax filers.)
2023 MassMutual Social Security Retirement Benefits Quiz
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In most cases, if I collect benefits before my full retirement age, they will be reduced for filing early.
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If I am receiving benefits before my full retirement age and I continue to work, my benefits may be reduced based on my earnings.
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If I have a spouse, he or she can receive benefits from my record even if he or she has no personal earnings history.
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In general, if I’m in a same-sex marriage, there are different eligibility requirements when it comes to Social Security retirement benefits.
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If I have a spouse and he or she dies, I will receive both my full benefit and my deceased spouse’s full benefit.
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The money that comes out of my paycheck for Social Security goes into a special account for me and stays there, earning interest, until I start receiving Social Security benefits.
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If I apply for retirement benefits and I have dependent children who are 18 or younger, they may also qualify for Social Security benefits.
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If I get divorced, I may be able to collect Social Security benefits based on my ex-spouse’s Social Security earnings history.
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Under current law, Social Security benefits for everyone could be reduced by 20% or more by 2035.
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Under current Social Security law, the full retirement age is 65, regardless of when you were born.
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If I delay taking Social Security benefits after age 70, I’ll get delayed retirement credits for every year I wait.
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Social Security retirement benefits are subject to income tax just like withdrawals from a traditional IRA account.
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I must be a US citizen to receive Social Security retirement benefits.
Answer: 1. true; 2. Truth; 3. Truth; 4. False; 5. False; 6. False; 7. truthful; 8. True; 9. Truth; 10. False; 11. False; 12. False; 13. False.
Grade: 0-1 False A; 2 wrong b; 3 wrong c; 4-5 wrong D; 6 or more wrong f.
ground level
Social Security is more complicated than waiting until full retirement age to claim a check. The questions of when to claim benefits, how to claim them and how to incorporate Social Security into your overall retirement plan can be complex. In fact, there are 81 different ways for married couples to claim benefits. One way to figure it all out is to check SmartAsset’s Social Security calculator. A free consultation with a trusted financial advisor can also be beneficial.
Tips for Managing Your Retirement Plans
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How much money will you need to save to be able to retire? Should You Delay Social Security? These are just some of the questions that pre-retirees face. A financial advisor can help you answer them. Finding a financial advisor doesn’t have to be difficult. SmartAsset’s free tool matches you with up to three verified financial advisors serving your area, and you can interview your advisors at no cost to decide which is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
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Fidelity recommends that you save 10 times your annual income for retirement by age 67. Try SmartAsset’s retirement calculator to find out if you’re on the right track. This free tool will estimate how much you’ll have when it’s time to retire.
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