Tuesday, March 3, 2015

26 Unsettling Truths About Social Security

Courtesy Daily Finance - By Lucy Mueller

The Social Security program is turning 80 this year, and though most Americans won't commemorate this milestone, 57 million will benefit from it for more than $1,200 a month.

The future of the Social Security program has been much debated, especially this month, as a new Congress looks to approve or deny a budget that would decide the immediate future of disability payments. We can expect full saturation of headlines, a fair amount of politicking and, ultimately, a sneak peek into what this program will look like in the coming decades.

It could be drastically different. Social Security was created in the wake of one financial crisis; nearly a century later, as the country limps to recovery from another, policymakers are making decisions about the program's future that have real-dollar effects on just about everyone.

That makes it a scary time for the millions of Americans approaching retirement -- and the millions who are just starting to fund the Social Security system. We've put together a list of everything you need to know -- the good, the bad, the awful, the silver lining -- so you can start building a realistic retirement plan.

1. At Its Current Pace, Social Security Will Run Out by 2033
2. Social Security's Disability Program Will Run Out Much Sooner
3. People Rely On Social Security Than Ever
4. The Ratio of Taxes to Payout Is Shrinking
5. All the Boomers Are Retiring at Once
6. People Are Living Longer
7. People Are Having Fewer Children
8. Benefits Are Growing Faster Than the Economy
9. First Beneficiaries Put Less In, Got More Out
10. Income Inequality Is Eroding Social Security
11. Social Security Benefits Could Get Cut
12. Social Security Taxes Could Be Raised
13. The Retirement Age Could Be Moved
14. Trust Funds Are Invested in Low-Yield Securities
15. Investing a Portion in Corporate Securities Could Be Risky
16. It's Not a Politically Convenient Time for a Fix
17. The Social Security Administration Is Understaffed                             
18. It's Losing Field Offices All Over
19. Wait Times Are Increasing at the SSA's 800 Number
20. The SSA Spent $288 Million in a Failed Attempt to Update
21. Most People Don't Know How Social Security Works
22. People Aren't Working in Early Retirement -- and They Should Be
23. People Lose Lots by Collecting Too Early
24. People Get Lower Benefits by Not Working for 35 Years
25. The SSA Won't Tell You About All Your Benefits
26. More Beneficiaries Will Owe Taxes on Benefits 

For more details regarding each of these facts, click here.

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Kevin Minton
Chief Executive Boards International


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