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Most Americans fear Social Security will run out in their lifetime, and those fears have only gotten worse during the Covid-19 pandemic.
That’s according to a survey by financial services firm Nationwide, which found that 71% of adults felt the same way. Fears about the benefits program were highest among Generation Xers, at 83%, and Millennials at 77%, while only 61% of Baby Boomers agreed.
In addition, 47% of millennials said they “won’t get a dime from the Social Security benefits they’ve earned.”
Many Americans — 59% — say they are now more pessimistic about the program’s funding running out after the pandemic begins. Meanwhile, 19% say Covid-19 has prompted them to reconsider their plans for claiming benefits, with 11% planning to delay filing and 9% planning to file a claim sooner.
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The trust funds Social Security relies on to pay benefits are running out. The latest official forecast from the Social Security Administration indicated that those funds could run out by 2035, after which 79% of promised benefits would have to be paid. That estimate did take into account possible pandemic effects.
Still, fears that the program will dry up and benefit controls will end are unfounded, said Shai Akabas, economic policy director at the Bipartisan Policy Center.
“A lot of people hear the words insolvent or bankrupt and automatically assume that the program is just going to disappear,” Akabas said.
“In reality, Social Security has been around for more than 80 years now and has more support than just about any other government position,” he said. “It’s highly unlikely it will go away anytime soon.”
While it’s likely there will be a fix, it’s taking Congress a long time to act. That could create uncertainty for Americans trying to plan for retirement, Akabas said.
In addition, the sooner lawmakers act, the less dramatic those changes can be. Higher taxes, cuts in benefits, or a combination of both are among the adjustments they would likely consider.
“It’s not that serious and important that the program is going to disappear,” Akabas said. “But it’s also not such an easy solution that we can wait at the last minute and patch it overnight.”
Based on research, benefits would likely be less than 25%, if they happen at all, said Joe Elsasser, founder and president of Covisum, a Social Security claiming company.
To calm those fears and empower people to plan, Covisum recently introduced an online tool to show how Social Security cuts would affect a person’s monthly checkups. In particular, the calculator doesn’t include a scenario where the benefits disappear altogether.
“The probability of it going to zero is as close to zero as possible,” Elsasser said.
The Nationwide survey was conducted online by the Harris Poll between April 19 and May 7. It included 1,931 American adults.