New research from Cornell University finds many Americans misunderstand how Social Security works when trust funds are depleted.
The study shows people often believe benefits will disappear entirely, despite ongoing payroll tax revenue.
Researchers said Social Security’s trust funds are projected to run out by 2035, but incoming payroll taxes would still cover about 75% to 80% of benefits.
The study found nearly two-thirds of participants believed benefits would stop completely when shown charts focused on the trust fund balance.
Researchers identified the misunderstanding as “inflow neglect,” where people focus on declining reserves and ignore continued income.
The findings were based on multiple experiments involving thousands of participants.
Suzanne Shu said, “But the reality is that payroll taxes will keep flowing in, and Social Security could still pay about 75% to 80% of scheduled benefits even if Congress does nothing.”
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