Article | October

Common Social Security Myths and the Facts Behind Them

October 08, 2026

Social Security decisions shape retirement income for years. Claims that benefits will disappear or remain unchanged are just predictions, and such misinformation can be costly. Sorting Social Security myths from Social Security facts will help you plan a successful retirement.

Lesson notes

SSA calculates retirement benefits from your highest 35 years of indexed earnings and your claiming age.
Many workers can claim at 62, but starting before full retirement age reduces the monthly benefit.
Delaying after full retirement age increases your monthly benefit through age 70.
You can work while receiving benefits, although earnings above annual limits temporarily reduce payments before full retirement age.

Myth: Social Security will replace most of my retirement income

People believe several Social Security myths. Among the Social Security myths debunked is the idea that one's monthly benefit will cover most retirement spending. That’s a false belief. In fact, the Social Security Administration (SSA) states, "Social Security benefits replace a percentage of a worker's pre-retirement income" (SSA, 2026a) [1].

In 2025, SSA estimated the average retired-worker benefit at $2,071 per month after the 2026 cost-of-living adjustment (SSA, 2026b) [2]. However, your amount may differ. Compare your estimate with your expected housing, healthcare, and everyday costs.
If there is a gap, look at other retirement income options. You can build retirement savings beyond Social Security through workplace plans, IRAs, savings, and other income. Additionally, understand the basics of investing to build wealth and generate passive income for retirement. Your income plan depends on your needs, and no single mix works for everyone.

Myth: everyone should claim benefits as soon as possible

Another myth is that you must claim benefits as soon as you hit age 62. You don’t have to. So, when should I claim Social Security? Often, this decision is a personal decision rather than a universal rule.

Retirement benefits typically start at 62 for people who’ve worked and paid Social Security taxes long enough to qualify. Full retirement age depends on birth year and is 67 for people born in 1960 or later. Starting before your Social Security full retirement age reduces your monthly benefit. On the other hand, delaying beyond full retirement age increases your benefit, but those increases stop at 70 (SSA, 2026a) [1].
Compare your health, income needs, work plans, and family circumstances, then review your SSA estimates at several claiming ages.

Myth: you cannot work and receive Social Security

Can I work while collecting Social Security? Yes. If you’re easing into retirement, you can continue working, although your earnings can affect current benefit payments before full retirement age.

In 2026, SSA withholds $1 for every $2 earned above $24,480 if you are under full retirement age all year. In the year you reach full retirement age, it withholds $1 for every $3 above $65,160 before the month you reach that age. From full retirement age onward, earnings no longer reduce retirement benefits (SSA, 2026c) [3].
SSA later recalculates benefits to credit months affected by the earnings test. It also increases your benefit if new earnings replace a lower-earning year used in the calculation (SSA, 2026c) [3].

Myth: benefits are based only on your final salary

Your final paycheck does not set your retirement benefit. Then, how are Social Security benefits calculated? SSA indexes earnings for wage growth and generally uses your highest 35 years to calculate average indexed monthly earnings, which feeds into the benefit formula (SSA, 2026d) [4].

Years with no or low earnings can reduce the average, while additional work can sometimes improve it if higher earnings replace a lower year (SSA, 2026c) [3]. Review your earnings record in your personal my Social Security account for accuracy and use the account to compare benefit estimates at different claiming ages.

Myth / Fact / What to Do

Myth	Fact	What to do
Social Security replaces most income	It replaces only part of pre-retirement income	It replaces only part of pre-retirement income
Claiming at 62 is always best	Early claiming generally lowers monthly benefits	Compare several claiming ages.
You cannot work and collect	Working and collecting can happen together	Check current earnings limits.
You cannot work and collect	Working and collecting can happen together	Check current earnings limits.

Verify the facts and build a broader retirement plan

After understanding Social Security facts, connect them to the rest of your household plan. Answer questions like: How will I maintain accessible savings for retirement expenses and address taxes? Ultimately, keeping Social Security myths debunked, sticking to the facts, and considering other income sources will help you build an optimal retirement plan.
Is Social Security taxable? Some benefits are subject to federal income tax based on combined income and filing status (SSA, 2025) [5]. If your combined income, which is adjusted gross income plus tax-exempt interest plus half of your benefits, exceeds $25,000 for single filers or over $32,000 for joint filers, you must pay federal tax. Outcomes vary, so have a qualified tax professional review your tax filings. Spousal or survivor benefits can also affect household income.
Utilize your my Social Security account and SSA calculators for personalized estimates instead of unofficial sources. Lastly, compare your expected benefits with expenses, and, if useful, consult Wings Financial Advisors to discuss your broader retirement plan.

FAQs

At what age can I start receiving Social Security retirement benefits?
- Eligible workers can generally start at 62, with reduced benefits before full retirement age.
Does working reduce my Social Security benefits?
- Before full retirement age, earnings above annual limits can temporarily reduce payments.
Are Social Security retirement benefits taxable?
- Yes, some are federally taxable. For single filers, you must pay taxes if your combined income is higher than $25,000, while joint filers pay if it exceeds $32,000.
How many years of earnings are used to calculate benefits?
- SSA generally uses your highest 35 years of indexed earnings.
Can I receive a spouse’s Social Security benefit?
- Yes, if you meet SSA's eligibility requirements, you can get up to 50% of your living spouse's full retirement amount, or up to 100% if your spouse has passed away.
Where can I find my estimated Social Security benefit?
- Use your personal my Social Security account for personalized estimates.

References

Social Security Administration. (2026a). Retirement Benefits (Publication No. 05-10035). https://www.ssa.gov/pubs/EN-05-10035.pdf
Social Security Administration. (2026b). 2026 Cost-of-Living Adjustment (COLA) Fact Sheet. https://www.ssa.gov/news/en/cola/factsheets/2026.html
Social Security Administration. (2026c). How Work Affects Your Benefits (Publication No. 05-10069). https://www.ssa.gov/pubs/EN-05-10069.pdf
Social Security Administration. (2026d). Your Retirement Benefit: How It's Determined (Publication No. 05-10070). https://www.ssa.gov/pubs/EN-05-10070.pdf
Social Security Administration. (2025). Must I pay taxes on Social Security benefits? https://www.ssa.gov/faqs/en/questions/KA-02471.html

This article is intended to be used for informational purposes and should not be considered financial advice. Consult a financial advisor, accountant or other financial professional to learn more about what strategies are appropriate for your situation.