Awareness of and Behavioral Responses to Impending Social Security Benefit Cuts

Abstract

Amid the looming insolvency of the US Social Security system, this study examines Americans’ awareness of potential benefit reductions and their anticipated behavioral responses. Survey results reveal that only one-fifth of respondents know about the projected 23% cut in future benefits, with black and Hispanic individuals 5 percentage points less likely to be aware. When informed of potential reductions, most current and future beneficiaries indicated they would reduce spending, delay retirement, or claim benefits later. Limited awareness of impending cuts could lead to suboptimal financial decisions, underscoring the need for targeted public education initiatives.