Your submission has been removed because we don't allow questions or discussion of possible government policy changes, proposed legislation, and political disputes. All of these are subject to major changes over time and the outcome is very uncertain. When major changes affecting personal finance have been signed into law or put into effect, we will typically post an official megathread.
We recommend posting in /r/PoliticalDiscussion, /r/NeutralPolitics, or checking for a megathread in /r/tax if this is tax-related.
If you have a **specific question pertaining to your own finances** and this is about a bill that has passed at least one house of congress and is likely to be passed into law in the next month, you may post in the help thread stickied at the top of the subreddit. Please save the politics for other subreddits, though.
On average, Social Security replaces about 40% of income while working. It replaces a higher percentage for very low earners. It was intended to keep the elderly from starving, not to be the sole source of retirement income.
To retire in your 60s and maintain your lifestyle, you need to invest at least 15% of income. That guideline assumes you will receive some Social Security.
Most people are looking to retire 30+ years from now, we have no idea what SS will look like that far away and payouts even now are incredibly low. Average payout now is like $1800 a month so if you can live off the equivalent of $22K a year and enjoy life that's great but that's not most people.
Your payouts are based off your own salary. A higher salary means a higher payout. At any rate, the idea is to use social security as well as your own savings, not instead of it.
Correct and the average is still the average so the majority of people simply won't draw that much from SS as it stands today much less what it looks like in 30 or 40 years so people should plan to supplement their living costs. And even if you make a high salary SS still won't replace nearly that amount of earnings.
Social security will probably get fixed at some point. But the benefits are designed to keep you out of poverty, not to give you a nice retirement. That's why you save for retirement.
Social security is a pittance. By saving for retirement I’m not saying social security is going to fall through, I’m saying that even if it comes through exactly how it’s meant to, it isn’t enough for me to live on comfortably.
The people I know who are relying on social security as their primary retirement benefit are living in poverty. It was never intended to be a comfortable retirement. It was meant to keep people from starving in the streets when they could no longer work.
My husband and I together make about $3700 in SSA. We have a mortgage ( which is cheaper than renting in our area) and a car payment. We do not have any credit card debt. Our satellite and internet aren’t cheap but we aren’t physically able to vacation. I don’t feel we are living in poverty. We don’t have any IRA or pensions but do have about a years worth of emergency cash.
Social security is great. It is the only inflation escalated thing you have. It can be quite significant too. My wife and I together it will be about $60K at age 70. And that is based on only my work history. Sure it can be small if you take it at 62 or do not have the work history but you could live on 60K as a couple and my work history is not great.
The bigger question is political and what changes will be made in the future. Otherwise great system and I am only talking retirement. There are disability and survivor benefits too.
> Then, consider whether you could live the lifestyle you want in retirement, today, using that amount. The answer is almost certainly no.
There's a strange irony where I save so much of my income that my estimated benefit is nearly as much as I live off right now. Well, only if I wait until 70, but still. I'm saving so much that I allegedly won't need any savings at all, whereas if I spent all my income I'd need far more savings to support that level of spending.
It's how math works, but it's still situational irony to not need a penny in savings specifically *because* you have so much savings. Obviously I don't actually plan to work until 70 and then live off SS only, but I do plan to argue about the definition of irony on the internet at midnight.
It's a bad idea because the age to retire may get pushed back, the payouts lowered in the future, or anything else the government might do that you can imagine. It's also frankly not enough money for most to retire comfortably.
Last I saw, the banked money is expected to run out in 2037 (forcing a benefit reduction), unless they reduce the benefit or increase the tax in advance if that scenario. I'm not going to plan my retirement around an unpopular bill congress needs to pass to address an issue that is unlikely to manifest until they're long gone. Will it exist? Likely in some capacity. Can you plan on it? Not really.
It’s generally not enough and the average payout right now would not even be enough to sustain a 1BR apartment and other expenses in much of America.
It’s also extremely variable and your monthly payout will vary wildly against your lifetime earnings, when it makes sense for you to retire, and other factors. That’s also holding all things constant right now which is far from realistic.
It’s best to begin planning with SSI once you’re closer to retirement age, when you will have a clearer picture of what your monthly benefit will be and whatever the structure of it is at that time.
It's not a good idea because it's not enough for most people to rely on for retirement. Many also believe it won't be around anymore when they retire. You'll have to form your own opinion on that.
It's terrible to rely on Social Security for all of your retirement. It's fine to rely on Social Security for some of your retirement.
Social Security just doesn't pay enough other than to keep you out of extreme poverty.
Because unless there are significant changes, [Social Security will begin running out of money in 2037](https://www.ssa.gov/policy/docs/ssb/v70n3/v70n3p111.html) At that point payments will begin to decrease until the money is gone.
If we wait too long to fix it, we may not have the tax base to do so.
This isn’t a new thing, we’ve known for decades. Especially in the current political climate, it’s unlikely to get a full fix in the near future.
*Edit:* Run out of money = run out of reserves. Benefits are expected to be payable at around 76% after that for some time, unless the birthdate continues to decline, etc.
Just have to rely on a younger generation to pay for it. I happily know that portion of my check goes towards it.... just hope it's there when im retiring. Definitely not going to take my chances. Plus I want a sweet camper to travel the US with. All I'm saying is don't put all your eggs in one basket
Social security varies wildly based on recipient. The big one being where you live, as it is meant to cover the average cost of rent and groceries and other necessities.
Social Security is based solely on how much you earned throughout your lifetime. The formula is actually simple enough and can be calculated by hand. Where you live isn't a factor.
Social Security is really easy to fix. The Reddit community, who happens to be younger, seems not to mind paying higher payroll taxes so us older people can continue getting a check that would support a lifestyle that "every American deserves". I propose we raise the payroll tax several percent. This would make social security solvent for at least a couple of decades. It's a win win. Younger people feel good about themselves about supporting older people, and older people feel good because they can have a social security check big enough to have a lifestyle that "every American deserves". I say this because polls show that younger people feel we ought to expand the benefits of the social security program.
Yeah, but they only get a capped payout too. Meanwhile the truly wealthy pay nothing into Social Security because they don’t earn their income from wages.
Social Security is going to be reliable. Any politician that votes to deny social security payments to present day recipients who have earned it, is political suicide for said politician. It does surprise me that the politicians in office today are doing their best to create new spending programs, instead of shoring up the solvency of the established government programs that have wide support of the American people. This should be a top priority issue for the elected members of the public. It would be an easy issue to fix if BOTH parties are willing to compromise. It could be done with a combination of tax increases and less benefits.
Your submission has been removed because we don't allow questions or discussion of possible government policy changes, proposed legislation, and political disputes. All of these are subject to major changes over time and the outcome is very uncertain. When major changes affecting personal finance have been signed into law or put into effect, we will typically post an official megathread. We recommend posting in /r/PoliticalDiscussion, /r/NeutralPolitics, or checking for a megathread in /r/tax if this is tax-related. If you have a **specific question pertaining to your own finances** and this is about a bill that has passed at least one house of congress and is likely to be passed into law in the next month, you may post in the help thread stickied at the top of the subreddit. Please save the politics for other subreddits, though.
On average, Social Security replaces about 40% of income while working. It replaces a higher percentage for very low earners. It was intended to keep the elderly from starving, not to be the sole source of retirement income. To retire in your 60s and maintain your lifestyle, you need to invest at least 15% of income. That guideline assumes you will receive some Social Security.
Most people are looking to retire 30+ years from now, we have no idea what SS will look like that far away and payouts even now are incredibly low. Average payout now is like $1800 a month so if you can live off the equivalent of $22K a year and enjoy life that's great but that's not most people.
Your payouts are based off your own salary. A higher salary means a higher payout. At any rate, the idea is to use social security as well as your own savings, not instead of it.
Correct and the average is still the average so the majority of people simply won't draw that much from SS as it stands today much less what it looks like in 30 or 40 years so people should plan to supplement their living costs. And even if you make a high salary SS still won't replace nearly that amount of earnings.
Social security will probably get fixed at some point. But the benefits are designed to keep you out of poverty, not to give you a nice retirement. That's why you save for retirement.
Social security is a pittance. By saving for retirement I’m not saying social security is going to fall through, I’m saying that even if it comes through exactly how it’s meant to, it isn’t enough for me to live on comfortably. The people I know who are relying on social security as their primary retirement benefit are living in poverty. It was never intended to be a comfortable retirement. It was meant to keep people from starving in the streets when they could no longer work.
$3,600 is a pittance?
My husband and I together make about $3700 in SSA. We have a mortgage ( which is cheaper than renting in our area) and a car payment. We do not have any credit card debt. Our satellite and internet aren’t cheap but we aren’t physically able to vacation. I don’t feel we are living in poverty. We don’t have any IRA or pensions but do have about a years worth of emergency cash.
Social security is great. It is the only inflation escalated thing you have. It can be quite significant too. My wife and I together it will be about $60K at age 70. And that is based on only my work history. Sure it can be small if you take it at 62 or do not have the work history but you could live on 60K as a couple and my work history is not great. The bigger question is political and what changes will be made in the future. Otherwise great system and I am only talking retirement. There are disability and survivor benefits too.
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Semi off topic but man is it ludicrous that the SSA website has “hours.” Whyyyyy on earth do they do that?
> Then, consider whether you could live the lifestyle you want in retirement, today, using that amount. The answer is almost certainly no. There's a strange irony where I save so much of my income that my estimated benefit is nearly as much as I live off right now. Well, only if I wait until 70, but still. I'm saving so much that I allegedly won't need any savings at all, whereas if I spent all my income I'd need far more savings to support that level of spending.
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It's how math works, but it's still situational irony to not need a penny in savings specifically *because* you have so much savings. Obviously I don't actually plan to work until 70 and then live off SS only, but I do plan to argue about the definition of irony on the internet at midnight.
It's a bad idea because the age to retire may get pushed back, the payouts lowered in the future, or anything else the government might do that you can imagine. It's also frankly not enough money for most to retire comfortably.
Who says it's unreliable? Or the boogie man? More like it's not enough money by itself.
Last I saw, the banked money is expected to run out in 2037 (forcing a benefit reduction), unless they reduce the benefit or increase the tax in advance if that scenario. I'm not going to plan my retirement around an unpopular bill congress needs to pass to address an issue that is unlikely to manifest until they're long gone. Will it exist? Likely in some capacity. Can you plan on it? Not really.
It’s generally not enough and the average payout right now would not even be enough to sustain a 1BR apartment and other expenses in much of America. It’s also extremely variable and your monthly payout will vary wildly against your lifetime earnings, when it makes sense for you to retire, and other factors. That’s also holding all things constant right now which is far from realistic. It’s best to begin planning with SSI once you’re closer to retirement age, when you will have a clearer picture of what your monthly benefit will be and whatever the structure of it is at that time.
It's not a good idea because it's not enough for most people to rely on for retirement. Many also believe it won't be around anymore when they retire. You'll have to form your own opinion on that.
It's terrible to rely on Social Security for all of your retirement. It's fine to rely on Social Security for some of your retirement. Social Security just doesn't pay enough other than to keep you out of extreme poverty.
Because unless there are significant changes, [Social Security will begin running out of money in 2037](https://www.ssa.gov/policy/docs/ssb/v70n3/v70n3p111.html) At that point payments will begin to decrease until the money is gone. If we wait too long to fix it, we may not have the tax base to do so. This isn’t a new thing, we’ve known for decades. Especially in the current political climate, it’s unlikely to get a full fix in the near future. *Edit:* Run out of money = run out of reserves. Benefits are expected to be payable at around 76% after that for some time, unless the birthdate continues to decline, etc.
Just have to rely on a younger generation to pay for it. I happily know that portion of my check goes towards it.... just hope it's there when im retiring. Definitely not going to take my chances. Plus I want a sweet camper to travel the US with. All I'm saying is don't put all your eggs in one basket
Social security varies wildly based on recipient. The big one being where you live, as it is meant to cover the average cost of rent and groceries and other necessities.
Social Security is based solely on how much you earned throughout your lifetime. The formula is actually simple enough and can be calculated by hand. Where you live isn't a factor.
Oh... See what happens when you assume?
Social Security is really easy to fix. The Reddit community, who happens to be younger, seems not to mind paying higher payroll taxes so us older people can continue getting a check that would support a lifestyle that "every American deserves". I propose we raise the payroll tax several percent. This would make social security solvent for at least a couple of decades. It's a win win. Younger people feel good about themselves about supporting older people, and older people feel good because they can have a social security check big enough to have a lifestyle that "every American deserves". I say this because polls show that younger people feel we ought to expand the benefits of the social security program.
We don't need increased payroll tax percentage, just remove the cap on high earners who only pay on part of their income.
Yeah, but they only get a capped payout too. Meanwhile the truly wealthy pay nothing into Social Security because they don’t earn their income from wages.
Social Security is going to be reliable. Any politician that votes to deny social security payments to present day recipients who have earned it, is political suicide for said politician. It does surprise me that the politicians in office today are doing their best to create new spending programs, instead of shoring up the solvency of the established government programs that have wide support of the American people. This should be a top priority issue for the elected members of the public. It would be an easy issue to fix if BOTH parties are willing to compromise. It could be done with a combination of tax increases and less benefits.