52 Percent of Young Americans Favor Social Security Opt-Outs Even If It Reduces Current Benefits
The vast majority of Americans (64 percent) have a favorable view of the Social Security program, with 25 percent who are very favorable, according to Reason-Rupe. However, delving deeper, it is less clear if Americans approve of the mechanics of the program's operation. Most Americans (52 percent) view Social Security as a retirement fund workers pay into to finance their own future benefits. Since the program was first established over 70 years ago, Americans have approved of the ostensible goal of Social Security as retirement savings. However, others would argue the program is run more like a transfer program where workers pay for the retirement benefits of current retirees without claim on the money they contribute. Only 38 percent of Americans perceive Social Security as the latter.
Conflicting attitudes about Social Security were reflected when Americans were asked to describe Social Security in one word. The most frequent response at 17 percent was that the program was a helpful or good program, but the second most frequent response (12 percent) was that the program was unstable or unsustainable. Other perceptions of the program included that the program was necessary or vital, a sham or hoax, mismanaged, or reliable.
After these initial questions were asked, Americans were given additional information about the current status of the program according to the Social Security Administration. First, they were told that Social Security currently pays out more than it collects in taxes, and that without any changes the Social Security Trust Fund would be depleted by 2033, possibly resulting in a benefit reduction of 25 percent or more. Knowing this, 57 percent of Americans favored changing the way benefits are calculated so they increase at a slower rate than they do now. This is in line with proposals to use chained CPI to calculate benefit increases.
After learning that the Trust Fund would be depleted by 2033, Reason-Rupe also asked Americans if they thought it was more important to maintain the current level of Social Security benefits for seniors, even if it required major tax increases (47 percent agreed), or maintain the current level of taxes, even if it required major Social Security benefit reductions by only paying benefits to seniors in financial need (37 percent agreed). In sum, if Americans face the trade-off between fully funding Social Security benefits with higher taxes or reducing benefits to maintain the current level of taxes, they favor raising taxes. But, the trade-offs continue.
When Americans then learn that they will eventually get back less in benefits than they paid in taxes, 57 percent oppose raising Social Security taxes and 62 percent favor allowing workers to opt-out of the program.
The real trade-off facing Social Security then, is if people are willing to raise taxes to maintain Social Security benefit levels even if they get back less than they paid in, or maintain tax rates and eventually reduce Social Security benefits. When these trade-offs are faced the public does not coalesce around a solution. When asked if they supported allowing younger workers to opt-out of Social Security taxes and benefits if it required only paying benefits to seniors in financial need, 44 percent favored and 48 percent opposed, within the survey's margin of error. Facing a different trade-off, 55 percent opposed reducing benefits for all seniors in order to allow younger workers to opt-out of the Social Security program.
When facing this trade-off, younger and older Americans significantly diverge in their policy response. Even when faced with the trade-off of reducing benefits to current seniors to allow younger workers to opt-out of Social Security, a majority (52 percent) of Americans under 35 favor the proposal. In stark contrast, 62 percent of Americans over 35 oppose the proposal. Instead, if allowing younger workers to opt-out of Social Security meant only paying Social Security benefits to seniors in financial need, then 60 percent of Americans under 35 favor the proposal, while a majority (53 percent) of Americans over 35 oppose the proposal.
While a majority of Americans under 35 favor opting out, a majority (51 percent) also say they are currently saving for retirement, but typically wait until about 30 to begin saving. Among young people who report saving, most are saving about 10 percent of their annual incomes. Most Americans under 35 make less than $45,000 a year.
Young Americans are far more likely than older Americans to believe that seniors have greater average wealth than young Americans. Nearly a fifth of Americans under 35 believe senior households are wealthier than non-senior households—only 6 percent of seniors agree. Instead a majority (54 percent) of seniors say their households are on average less wealthy than non-senior households, compared to 34 percent among Americans under 35.
These results paint a complex picture of Americans' attitudes about Social Security. Those who have already paid in expect to receive promised benefits, those currently paying in are less eager to do so if they believe they may not get that money back.
Nationwide telephone poll conducted May 9-13 2013 interviewed 1003 adults on both mobile (503) and landline (500) phones, with a margin of error +/- 3.7%. Princeton Survey Research Associates International executed the nationwide Reason-Rupe survey. Columns may not add up to 100% due to rounding. Full poll results found here. Full methodology can be found here. Demographics and detailed tables are available here.