Social Security Isn’t as Great as People Think
It might take actually receiving benefits to realize the limits of America’s most popular social insurance program, but Maurie Backman covers three important features here. First, your benefits won’t come close to replacing your income in full. Figure about 40% income replacement, and note one cannot live on that alone without hardship. Second, benefit cuts might happen relatively soon, as insolvency hits in 2032 or 2033. Projected cuts are 23% without a program overhaul, but even with congressional reform, some kind of change, including a diminished monthly benefit in the future, is likely. Third, benefits are taxable. More seniors get hit with income tax yearly as the thresholds for when tax kicks in have never been adjusted for inflation. Full piece here.