How to cope with Social Security’s “worst case scenario”
It’s surely no secret by now that Social Security is faced with financial difficulties in the future unless Congress acts soon to either improve revenue, cut costs, or a little of both. Starting this year, Social Security will actually be paying out more in benefits than the income it receives from payroll taxes, income taxes on Social Security benefits, and interest on Trust Fund investments. And the shortfall will be taken from Social Security’s Trust Fund, which means that the Trust Fund’s current balance of about $2.9 trillion will start to be depleted. In the worst case scenario, the Trust Fund will be totally depleted in about 2034 which will mean that benefits will be cut by about 21% because the program can only pay out as much as it receives. Clearly we want to be optimistic that Congress will act to prevent that from happening, but what hedge can you have to protect yourself if it doesn’t? The answer is simple: Build your retirement savings nest egg as much as possible, as explained in this article by Maurie Backman appearing in the (IA) Globe Gazette.
AMAC has been at the forefront trying to strengthen Social Security by developing and proposing its Social Security Guarantee. AMAC has been discussing and continues to discuss this common-sense solution with Congressional Representatives in its efforts to protect America’s senior citizens who rely on Social Security. To review AMAC’s Social Security Guarantee, click here.
To read the Globe Gazette article by Maurie Backman, click here.