Social Security is an increasingly discussed topic. When should you start taking your benefits? Will it run out in my lifetime? These are just a couple of questions you may be asking yourself. It can be overwhelming to make decisions, let alone anticipate changes. Independent wealth management advisor Mike Reeves of Strategic Wealth Designers joined the newscast to discuss the recent congressional research surrounding Social Security. The current full retirement age is 66 years and 10 months for those who become eligible in 2021.
“Recent congressional research on Social Security examined full retirement age, the idea of raising retirement age, and concerns surrounding this,” he says. “Despite this, there is not a plan in place to raise the full retirement age. Currently, those born in 1960 or later have a full retirement age of 67, which means they can start getting Social Security benefits in 2022 and reach full retirement age in 2027. But the recent congressional research has looked at what the impacts would be of raising the age for Social Security benefits.”
In 1983, the Social Security program was amended by Ronald Reagan. The 1983 Amendment to gradually increase full retirement age will be in full effect in 2022. If the age was increased once again, people would generally be more inclined to work longer based on congressional research. It is estimated that trust funds will be depleted in 2035. This doesn’t mean there won’t be any benefits after 2035, however. Tax revenue will account for majority of the benefits scheduled.
“It isn’t realistic for those that are early in their retirement saving to count on having the same Social Security situation that we see today,” Reeves says. “While part of Biden’s platform includes Social Security reform, it doesn’t guarantee that the issues will be fully resolved. What is likely is that future generations will have to work longer, so they won’t see the same benefits that their grandparents are enjoying now.”
So, while Social Security will likely not just disappear down the road, it will look different than what we have seen in the past. To prepare for this, begin your own retirement saving as early as possible. Consider working with an advisor to make sure you are adequately prepared and have an income plan in place for your retirement. To see additional stories surrounding business and economic news for the Indianapolis area, visit https://CBS4Indy.com/Strategic-Wealth and if you have a question for Mike send an email to firstname.lastname@example.org.