A Panel’s Reactions To The Research

Following the press conference, a panel discussed the research results.  It was made up of Gary Koenig, vice president of financial security at the AARP Public Policy Institute, Dr. Thomas Hungerford, associate commissioner of the Office of Retirement Policy Social Security Administration, and Dr. Dave Yeske, practitioner editor of the Journal of Financial Planning.

Koenig’s noted the research indicated that many people do not know the rules of the road. They also fail to realize how important it will be for people when they retire.

“Social Security is complicated.  There are a lot of rules that are not quite obvious.  We need to make the information [make sense] so they can make good decisions,” said Koenig.  “It is not that they are ignorant.  It is complicated.”

Yeske, agreed, noting that financial planners even use Social Security software, because it is complicated. He pointed out that consumers need to save on their own and not rely soley on Social Security benefits for retirement. 

“Even for the mass affluent, it is not a trivial benefit,” Yeske said. Financial planners that work with their clients on Social Security look at future sources of income, health, life expectancy and more to help their clients make smarter decisions.

Yeske compared Social Security to longevity insurance.  “If it is going to work as longevity insurance, they have to defer it as long as possible,” said Yeske.  “We consider it to be a very important benefit.  Even the wealthiest clients want to do it right.  It also leaves room to leave a larger legacy.”

Hungerford said two things that really struck him about the survey.  "At least a majority know that 62 is the age of retirement. But they should be focusing on 66 and postponing," he said.  "They are focusing on the wrong age."

Equally disconcerting was where many Americans go for advice on Social Security. "Who do people ask?  Half of the people rely on family and friends.  Getting info from people that have as much information as they have,” Hungerford said.

The study showed that only one out of five rely on other experts. Since Social Security statements are not shared in the mail on an annual basis anymore, Hungerford recommended everyone set up a My Social Security account online.  He said it is important to also check earnings, as mistakes happen.  “It is rare, but fixable,” said Hungerford.