New Survey Shows Strong Backing for Social Security Investment

May 10, 2001

A national survey released on Wednesday found that "most U.S. workers would be willing to see their Social Security benefits fall if they could direct a portion of their payroll taxes into a private retirement plan such as a 401k or Individual Retirement Account, reports Christopher Noble of Reuters. The survey shows strong support for the idea across age, income and gender groups.

Personal retirement accounts would not in fact cut Social Security benefits, but would only mean a smaller percentage of benefits coming from the current government-run system and more from a worker's individually-owned account. The survey, conducted by Boston-based financial research firm Dalbar, found some 55 percent preferring to direct some of their Social Security taxes into private retirement plans even if it meant getting a smaller retirement check from the government each month. Sixty-five percent of men backed the idea while about 48 percent of women supported it.

Younger people were more likely to embrace such a measure, with nearly 59 percent of those 30 to 50 years old in favor and a smaller 49 percent of those 51 to 70 years old backing it. Full time workers were more likely to be in favor than those working part time. The survey did not collect information from workers under 30, who are ordinarily the most supportive of personal accounts.

"Consumers in favor of the opting out of Social Security benefits represent the growing population segment that believe the system will fail," the researchers wrote. "Forfeiting benefits in exchange for lowered taxes underscores a deep disbelief in the system's future." Dalbar president Louis Harvey said he was surprised by the survey, which showed an enormous increase in support for the idea of a partial privatization of the main U.S. retirement plan compared to two years ago. "This is striking because the market has suffered dramatically but that hasn't diminished the interest and two years ago there was very limited interest in this," Harvey said.

The study was conducted in April and surveyed 1,313 consumers over age 30. It has a margin of error of plus or minus three percentage points.

2002 Index | 2001 Index | 2000 Index | 1999 Index | 1998 Index