That's not a problem for most people. Nearly 70 percent of beneficiaries, according to the AARP, don't pay taxes on benefits.

The value

Many workers underestimate the value of Social Security and its cost-of-living adjustments.

The average combined benefit for a retired couple is $1,994 per month, Lucey says. That may not seem like much. But if they were to buy an annuity that paid a similar benefit — also adjusted for inflation — over 20 years, the cost would be $485,000, Lucey says.

And Social Security isn't just for retirees.

It provides benefits for young workers who are disabled or who die and leave behind a family, says Nancy Altman, co-director of the advocacy group Social Security Works.

For a 30-year-old earning $30,000 a year with a spouse and two young kids, Social Security is like having $465,000 in disability insurance and more than $475,000 in life insurance, she says.

"For most Americans, their largest asset is Social Security," Altman says.

eileen.ambrose@baltsun.com

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