Myth: Your contributions are going into an account with your name on it.
Fact: Unfortunately, that is not the case. Social Security isn’t like a 401(k) or even a traditional funded pension plan. Your contributions are immediately paid out to current beneficiaries.
Myth: You won’t get Social Security benefits if you’ve never worked outside the home.
Fact: It’s true that you won’t get Social Security benefits based on your own earnings record. Fortunately, you can get benefits based on the earnings of your spouse or ex-spouse (if you were married for at least 10 years). These spousal benefits are equal to half of your spouse’s or ex-spouse’s full benefits and collecting them won’t affect your spouse or ex-spouse’s benefits at all.
Myth: I don’t need to include my social security benefit, when planning my retirement.
Fact: Social security wasn’t intended to fully fund your retirement. But it plays an important part in an American’s retirement income plan. How Much? Check your Social Security earnings and see an estimate of your benefits on the website, www.ssa.gov.
Myth: You should enroll in social security as soon as possible.
Fact: If you start taking Social Security at age 62 you could leave a lot money on the table if you live into your 90’s. However everyone situation is different and social security is a complex decision. Ideally everyone should sit down with an advisor and weigh out their options.