Social Security: How Worried Are You About Its Future?

According to official figures, 53% of married couples and 74% of unmarried Americans count on Social Security for at least half of their retirement income. Almost half of those unmarried persons rely on Social Security for virtually all of their income. In real numbers that means probably living on less than $1,300 a month. 

Enough has been written about the problems facing Social Security and the dwindling funds meant to support it. Demographic factors, government's use of the money intended for Social Security for other purposes, and the politics of it all could spell a shaky future ahead for something that virtually all older Americans receive. Various dates have been published, but most predict there will not be enough money to pay full benefits beginning in the next 12-17 years.

Small Cost-of living adjustments were made this year, but disappeared for most because of an increase in Medicare Part B costs that matched the increase (strange how that happens). Full Retirement age also started moving upwards this year. For those born in 1955, 66 years and 2 months becomes the new age to reap 100% of expected monthly payments.

The effect will be small but produce an unexpected consequence: choosing to receive checks at 62 will actually mean taking benefits that are reduced even further than one might expect because of those pesky 2 months. And, that reduction will continue for the rest of one's life. The full retirement age will continue to increase by 2 months for those born in subsequent years until it reaches 67 for those born after 1959.

I don't want this post to become political finger-pointing. There are enough reasons and blame for Social Security's problems to go around. Since the problems became obvious to anyone paying attention, both parties, Congress and presidents have kicked the can down the road. In about a decade there is going to be no more road.

The questions I'd like you to consider are: how worried are you that your benefits are going to be cut? How will that affect you? Do you think your children or grandchildren will face a future without Social Security? 

What may be the solutions: Full retirement becomes 70, reduced payments are made to those who have substantial portfolios, the payroll tax increases, it becomes illegal to tap the Trust Fund for other uses?

For blog readers in other countries, what does your government do with the idea of retirement checks? Is your system in good shape, or are you just as concerned as many Americans?

This could become a fascinating sharing experience for us all. I doubt we will solve the problems, but we may learn something along the way that helps us plan our future.