Americans Aware of Changes to Social Security, Tax and Benefits Programs

Recently, changes were made which affect the amount that Americans contribute to programs through their paychecks as well as to some of the benefits that they receive. A majority of U.S. adults say they are familiar with the changes to extend unemployment benefits (69%), extend the Bush-era tax cuts (65%) and the recent changes to Social Security contributions (53%).

These are some of the findings of a new 24/7 Wall St./ Harris Poll survey of 2,364 U.S. adults surveyed online between January 27 and 31, 2011 by Harris Interactive.

Although a majority are familiar overall, older Americans are more likely to be familiar with these recent changes than those younger. Over four in five Americans aged 55 and older say they are familiar with the extension of the unemployment benefits (85%) compared to three in four of those 45-54 (76%), two thirds of those 35-44 (65%) and just half of those 18-34 (51%). Similarly, Americans 55 and older are more likely to be familiar with the legislation to extend the Bush-era tax cuts as well as the changes to Social Security contributions (80% and 70%, respectively) than are those younger. In fact, among 18-34 year olds under half are familiar with extending the Bush era tax cuts (48%) and just over one-third (36%) are familiar with changes to Social Security.

Expectations and Planning

When asked if Americans believe they personally will receive more money this year as a result of the recent changes, one quarter say they think they will (24%), half of Americans think they will not receive any additional money (49%), and 27% are not sure. Older Americans, who are most familiar with the changes, are most likely to say they do not think they will receive any additional money this year as a result. Over six in ten Americans 55 years and older say this (62%) compared to fewer Americans aged 18-34 (44%) and 35-44 (38%) who say the same. Not surprisingly, younger Americans, least familiar with the changes, are more likely than those older to be unsure whether or not they will receive more money as a result – one third of those 18-34 say this (33%), compared to a quarter of those 45-54 (25%) and only one in five of those 55 and older (20%).

Among those Americans who think they will receive additional money in 2011, just two in five say they have thought about how they will use that money (41%), while the majority say they have not thought about it (59%) with a third saying they have not thought about it at all (32%). However, there is an interesting age difference here as well—younger Americans who believe they will receive additional money this year are more likely to have thought about what they will do with the money (52% of those 18-34 have thought about it, as have 46% of those 35-44 compared to 33% of those 45-54 and just 31% of those 55 and older).

Using the Additional Funding

When Americans who believe they will receive additional money in 2011 as a result of recent changes in tax legislation and Social Security policy were asked to think about how likely they are to use the funds in various ways, over half say they will use the money to pay down their debt (52%). Just under half of Americans who think they will receive additional money this year say they will likely use it for everyday spending, such as paying bills and buying groceries (46%), two in five say they will use this money to add to their savings and/or investments (41%) and one in five say they will use the money to make a specific purchase, such as a car, new home, home renovation or piece of jewelry (19%). Fewer Americans say they will use the money to take a vacation (15%) and very small numbers say they will do something else with the money (2%) or that they are not at all sure how they will spend it (4%).

So What?

These legislation and policy changes may aim to put more money in Americans' pockets, with the intention of luring them back into stores to spend, which would help the overall economy grow. However, it appears that although Americans are aware of the recent changes, many either do not think that they personally will gain from them, or, those who do think they will receive additional money say they have thought little about using it. When pressed it's apparent that Americans will likely use the money in conservative ways, paying down their debt and buying groceries, rather than making new or elaborate purchases. Time will tell if this reflects a cultural shift in American interests and priorities, or if Americans are still operating in a hunkered-down, crisis-mentality.

This 24/7 Wall St./Harris Poll was conducted online within the United States between January 27 and 31, 2011 among 2,364 adults (aged 18 and over). Figures for age, sex, race/ethnicity, education, region and household income were weighted where necessary to bring them into line with their actual proportions in the population. Where appropriate, this data were also weighted to reflect the composition of the adult online population. Propensity score weighting was also used to adjust for respondents' propensity to be online.