Most Adults Don't Trust Medicare or Social Security Will Help Them Retire

Majority of survey respondents don't expect to retire comfortably

Published Nov. 25, 2020

 

When people think about retirement, they tend to envision lounging on a beach, sipping a piña colada, trotting the globe or playing golf every morning. 

But according to our recent study, most adults aren’t confident Medicare or Social Security benefits will be able to help them retire comfortably.   

We surveyed 1,054 adults in their 20s, 30s, 40s and 50s about the future of Medicare, Social Security and their overall vision of their own retirement. The majority of respondents expressed a lack of confidence in the future of these federal programs, and our findings painted a rather bleak picture of the quality of life many people expect in retirement, particularly among younger adults. 

Key Findings

  • 70% of people under the age of 60 believe Social Security benefits will be reduced or altogether nonexistent by the time they retire. 62% said the same about Medicare.

  • Only 7% of respondents are “very confident” that the federal government will make the necessary improvements to protect Medicare and Social Security.

  • More than half of respondents would opt out of Social Security if they could.

  • 40% of Americans under age 60 don’t correctly understand how Social Security works, and 42% believe it to be a Ponzi scheme

Americans Are Concerned About Social Security

Distrust in Social Security is so high that 42% of our respondents believe Social Security is a Ponzi scheme

And that sentiment increased with age, as 65% of respondents in their 50s believed it to be true, compared to just 28% of those in their 20s. Among all four age groups polled, the older the participant was, the more likely they were to believe that Social Security is a Ponzi scheme. 

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Graphic showing percentages of people who think Social Security is a Ponzi scheme

Nearly half of our respondents believe Social Security benefits either won’t exist (20%) or will be greatly reduced (29%) by the time they retire, with an additional 21% predicting they will be only somewhat reduced. That left just 3 out of 10 people who believe Social Security benefits will be at least equal to what they are now.

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Graphic showing the percentages of how people feel about the future of Social Security

So many Americans lack confidence in Social Security that 52% said they would opt out of the program entirely if they were allowed.

Not only did we find a lack of trust in Social Security, we also found a general lack of knowledge about how the program operates.

40% of adults under the age of 60 incorrectly believe that Social Security is a personal retirement account that they pay into for their own use during retirement.

Most Adults Under Age 60 Lack of Confidence in Medicare

Our respondents’ lack of confidence in Social Security was mirrored by a similar distrust in Medicare.

62% of respondents feel Medicare benefits will be greatly reduced (31%), somewhat reduced (19%) or nonexistent (12%) by the time they retire. The younger the participant, the more likely they were to be skeptical of the future of Medicare. 

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Graphic showing the percentages of how people feel about the future of Medicare

That apparent lack of confidence in Medicare is highly problematic, considering roughly half of our respondents said Medicare is either very important (29%) or moderately important (20%) to their retirement plans.

Our survey participants displayed a similar lack of knowledge about Medicare as they did about Social Security.

Almost 40% of respondents were unable to correctly define Medicare as federally provided health insurance for people aged 65 and older and people under age 65 with qualifying disabilities, instead selecting that it’s either private insurance that older adults can buy if they don’t have a preexisting condition or health insurance coverage for people who have limited financial resources.

Distrust in Government Management of Public Benefits Is High

When asked about their greatest fears and concerns for retirement, Social Security and Medicare benefits being reduced or eliminated were among the most popular answers across all age groups. But the general distrust in Medicare and Social Security seemed to stem from a broader overall distrust in the government’s handling of these public benefits. 

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Graphic showing percentages of the fears people have for their retirement

When asked how confident our respondents were that the federal government would implement policies to improve Medicare and Social Security, just 7% reported having the highest levels of confidence. 

Meanwhile, 31% selected “not at all confident,” and 26% said they were only “slightly confident.” 

73% of our respondents believe the federal government should provide more financial support to retirees than it currently does.

Many Americans Worry About Their Quality of Life in Retirement 

Regardless of their level of faith in public safety nets, a significant portion of Americans worry about their overall quality of life in retirement. 

30% of all respondents expect their quality of life to decrease in retirement, while just 39% expect it to get better. 

24% of people in their 20s and 27% of people in their 30s said they were “not at all confident” they would be able to fully retire with a comfortable lifestyle. Fewer than 10% from both age groups reported being “very confident” they will retire with a comfortable lifestyle. 

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Graphic showing percentages of levels of confidence to be able to retire comfortably

Some of the obstacles standing in the way of retirement savings for younger respondents include student loans and COVID-19 job losses for younger respondents, while health care expenses are the highest obstacle among older participants.

Nearly 3 in 5 people in their 50s cited health care expenses as something that was affecting their ability to save for retirement. 

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Graphic showing percentages what most affects retirement savings

Many respondents aren’t sure they’ll be able to retire at all, let alone with a comfortable lifestyle.

Two-thirds of our respondents expect to continue working either full-time (35%) or part-time (32%) once they reach retirement age. Only 11% were confident they would not work at all beyond retirement age. 

Respondents in their 50s were the group who most felt they would continue working full-time past retirement age, at 52% or respondents in this age group. Only 26% of people in their 20s expect to work full time past retirement age. 

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Graphic showing percentages of people who plan to work after retirement age

Of those who plan on working past retirement age, the majority in each age group cited financial concerns as their main reason for doing so. 

Only 20% of respondents reported to be slightly or not at all concerned about health care costs in retirement. Over half said they were moderately (27%) or very (28%) concerned. 

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Graphic showing percentages of people are concerned about health care costs in retirement

Conclusion

Our findings indicate that a significant population of U.S. adults ages 20 to 59 have concerns about their health, finances and overall quality of life in retirement.

Younger people are more likely to worry about the future of Medicare and Social Security than older adults. But confidence in the federal government as it relates to public benefits is lacking across the board, and most people feel the government should be doing more to financially support retirees.

Methodology

This study was conducted on November 25th, 2020, using an audience pool gathered using MTurk and Prolific, survey platform tool. The total survey included 1054 respondents aged 20 to 59. 35% of participants were aged 20 to 29, 36% were aged 30 to 39, 17% were aged 40 to 49, and 12% were aged 50 to 59.

Participants were filtered based on completion time and failure to follow written instructions within the survey.

Margin of error: +/- 4% (95% confidence interval)

This survey relies on self-reported data.

Fair Use Statement

Of course we would love for you to share our work with others. We just ask that if you do, please grant us the proper citation with a link to this study so that we may be given credit for our efforts.

Research and reports

Our research reports analyze a number of issues important to seniors, from health perceptions, medical communication, health habits, and more.