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For Social Security: “Status Quo = Benefit Cuts” - ASPPA
Most Americans approaching retirement age know that waiting longer to claim Social Security means a higher benefit for the rest of their life yet, according to one study, only about 10% of Social Security claimants wait to get the maximum possible Social Security benefit. Age 70 is when Social Security benefits reach maximum, typically 76% more than the age 62 benefit and between 24% – 32% more than the benefit available at full retirement age. Still, nearly half of those approaching retirement intend to claim Social Security before their full retirement age, fully aware they will be accepting a permanently reduced monthly payment. Significantly, that decision is often based on a lack of confidence that Social Security will always be there.
Uncertainty about Social Security’s stability is fueled by a sobering fact – Social Security’s financial reserves are now being used to pay full benefits and, unless Congress acts soon, those reserves will be depleted in 2033 resulting in an across the board benefits cut to all beneficiaries. Nevertheless, as the 2024 election approaches, politicians are vowing “not to touch” Social Security. But is that a sound plan? Hardly, because as this article by John Sullivan appearing in a publication by the American Society of Pension Professionals & Actuaries (ASPPA) explains, for Social Security the status quo equals a cut in benefits. The article goes on to explain more about planning for a comfortable retirement, but the underlying message is clear – Social Security will only provide a portion of your retirement income, so plan now for how to get the rest. Click here to read the ASPPA article.