Social Security is enormous and complex, paying out more than $120 billion in benefits a month to nearly 69 million retirees, people with disabilities and their family members. It's

wildly popular: An overwhelming majority of Americans across party lines support raising taxes to keep the program fiscally sound, according to a January 2025 study that was co-funded by

AARP. And it is key to older Americans’ financial health, providing a majority of family income for 2 in 5 people ages 65 and older.  Given Social Security's importance, concerns about

its current and future state are understandable and widespread. Some of those worries, and the many changes to the program in its 90-year history, have given rise to misconceptions about how

Contributions Act) taxes largely cover the benefits going out. JOIN AARP'S FIGHT TO PROTECT YOUR SOCIAL SECURITY You’ve worked hard and paid into Social Security with every paycheck.

But recently, we've heard from thousands of worried Americans. Join us in sending a loud and clear message to lawmakers. Social Security does face funding challenges. For decades it

collected more than it paid out, building a surplus that stood at $2.79 trillion at the end of 2023, the most recent data available. But the system is starting to pay out more than it takes

in, largely because the retiree population is growing faster than the working population, and living longer. Without changes in how Social Security is financed, the surplus is projected to

run out in 2035, according to the latest annual report from the program's trustees. Even then, Social Security won't be broke. It will still collect tax revenue and pay benefits.

But it will only bring in enough to pay 83 percent of scheduled benefits, according to the latest estimate. To avoid that outcome, Congress would need to take steps to shore up Social

Security's finances, as it did in 1983, the last time the program nearly depleted its reserves. The steps then included raising the full retirement age (see Myth #2), increasing the

payroll tax rate and introducing an income tax on benefits (see Myth #8). MYTH #2: THE SOCIAL SECURITY RETIREMENT AGE IS 65 THE FACTS: Full retirement age, or FRA — the age when a worker

qualifies to file for 100 percent of the benefit calculated from lifetime earnings history — is 66 and 8 months for people born in 1958, 66 and 10 months for those born in 1959 and 67 for

those born in 1960 and after. The 65 threshold is a longtime Social Security truth that became a myth. When Social Security was created in 1935, 65 was set as the age of eligibility. In

later decades, the minimum eligibility age was lowered to 62, when people could claim a reduced benefit, but 65 remained the standard for full retirement. That changed with the 1983

overhaul, which raised the retirement age to reduce Social Security's costs. The increase is being phased in over time; 2002 was the last year in which people turning 65 could claim

their full benefit. MYTH #3: THE ANNUAL COLA IS GUARANTEED THE FACTS: Since 1975, Social Security law has mandated that benefit amounts be adjusted annually to keep pace with inflation. But

there is no requirement that this cost-of-living adjustment (COLA) produce a yearly increase. The COLA is tied to a federal index of prices for select consumer goods and services called the

CPI-W. Benefits are adjusted annually based on changes in the CPI-W from the third quarter of one year to the third quarter of the next. In the third quarter of 2024, the index showed an 2.5

percent increase in prices, so benefits are 2.5 percent higher in 2025. But if the index doesn't show a statistically measurable rise in prices — if there's effectively no

inflation — then there's no adjustment to benefits. This has happened three times since the current formula was adopted, in 2010, 2011 and 2016. Whether or not it produces a benefit

increase, this process is automatic; it does not involve the president or Congress. They would have to take separate action to change the COLA.