Only 7% of Americans Can Pass a Basic Retirement Knowledge Test, According to a New 2025 Study

"The test covers six essential topics, including Social Security, Medicare, workplace savings, annuities, long-term care odds, and life expectancy. The six questions are not technical. They ask whether Social Security benefits adjust for inflation, what Medicare covers, and what an annuity does. The average American gets only 2.2 of the 6 right, or a measly 37%. Accuracy ranges from 53% on the annuity question down to 23% on the likelihood of needing long-term care."

"Only 7% of Americans can answer five or six of these correctly. The long-term care question is particularly revealing (and concerning), as most adults over 65 will need some form of paid care, and Medicare does not cover it beyond a few weeks. Three out of four Americans do not know that. The 7% figure functions as a competence cutoff. Below that line, retirement decisions are made without basic facts."

"The study connects knowledge scores to behavior, and the spread is wide. Among workers who answer five or six questions correctly, 85% are saving for retirement, and 63% have calculated how much they will need. Among workers who answer zero correctly, only 48% are saving, and just 23% have run the numbers. The high-fluency group is nearly three times more likely to have done basic retirement math."

The test measures retirement knowledge across six essential topics: Social Security, Medicare, workplace savings, annuities, long-term care odds, and life expectancy. Only 7% of Americans answer five or six questions correctly, with an average score of 37%. Questions focus on fundamentals such as whether Social Security adjusts for inflation, what Medicare covers, and what an annuity does. Accuracy varies widely, including 23% on the likelihood of needing long-term care, even though many older adults will need paid care and Medicare does not cover it beyond a few weeks. Low knowledge is linked to behavior, with higher literacy associated with greater retirement saving and more people calculating how much they need.

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