Dispelling the Social Security Bankruptcy Myth
You’ve heard us say it time and time again, and we’ll continue to explain it to the many, many folks who contact our Social Security Advisory Service: Social Security is not going bankrupt! But don’t let that basic fact lull you in to a sense of complacency, since there is a very real problem facing the program. The simple truth is that, unless lawmakers take corrective action in time, there will likely be an across-the-board benefit cut for all Social Security beneficiaries less than 15 years from now.
Of course, one of the ways to protect yourself from the hopefully unlikely scenario of a benefits cut is to take action personally to shore up your financial planning as quickly as you can. The Motley Fool’s Maurie Backman, in a post on their website, echos what we’ve been saying about Social Security’s future, and adds thoughts on the importance of saving for retirement. Ms. Backman’s point is that rather than worry about what might happen, you’re better off taking action on your own to protect your future. Read her article here…
While we’re on this subject, it’s important to note that the Association of Mature American Citizens (AMAC) has a plan to preserve and modernize Social Security without raising taxes. To avoid the potential for an across the board benefit cut in 2035, AMAC proposes a gradual increase in the retirement age (early retirement remains age 62). We recommend changing the level of payments slightly for future high-income retirees, and we propose a tiered but guaranteed approach to calculating cost-of-living adjustments (no more zero percent raises). AMAC’s plan also provides a means for all earners to have more income available at retirement with our voluntary companion plan, Social Security PLUS. View the plan at www.amac.us/social-security…