Do Doomsday Headlines Lead to Bad Social Security Choices?

Ivonne Wierink /

We’ve all heard the bleak prediction: The Social Security trust will likely run out soon, perhaps as early as 2034.

As it turns out, articles with “doomsday” headlines about Social Security can have a powerful impact on when retirees decide to claim their benefits.

Workers who read the headlines focusing on the expected trust fund depletion history planned to claim benefits a year earlier, on average, than those in the control group, according to a new report from the Center for Retirement Research at Boston College.

On the surface, this might seem like a rational decision. But the center’s researchers say it likely reflects a failure to understand the true state of the Social Security program, and it’s not as bleak as the headlines suggest.

Study authors Laura Quinby and Gal Wettstein point out that these headlines ignore the fact that even after the trust fund has been depleted, there is still enough running revenue to support 75% of assessed benefits.

Readers who engage in such titles may mistakenly believe that “all future benefits are unsafe,” the authors wrote. This can motivate them to make decisions about Social Security benefits they wouldn’t otherwise, which could hurt their long-term retirement prospects.

The authors write:

“For example, workers may claim earlier than they would otherwise because they believe future reforms will reap individuals already receiving benefits. Claiming at age 62 instead of the full retirement age (FRA) currently reduces monthly benefits by 30 percent, evidence suggests. It also reduces the lifetime benefits.”

The study authors also say that their research indicates that “in no way do workers plan to increase their savings to offset future reductions in benefits.”

The researchers concluded that “media coverage of the trust causes many workers to fear an unrealistically sharp reduction in future Social Security benefits.” If these workers claim benefits early, “they will receive fewer monthly benefits without increased saving to make up the gap.”

Should you claim your benefits early or later? The answer is not the same for everyone. For more, check out:

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