Social Security

Over 62 millions Americans are receiving Social Security benefits. 96% of all American workers are covered under Social Security. 

By participating, you have an average of $1,000 a month in Social Security benefits. That is equal to having $250,000 in a retirement plan that pays 5% annually (401kspecialist, 2018). Social Security is a great retirement resource, which allows people to be more aggressive with their other retirement savings.  


Will Social Security run out of funds? 

Will Social Security run out of funds? 

Many people are asking that question. Social Security are facing fund challenges, but nothing immediate. According to the latest report (2018), Social Security is estimated to not being able to pay out full benefits after 2034. If nothing is done, 75% of the benefit is still going to be paid out (AARP, 2018).

Social Security's forecast improved in 2018. Due to the strong economy and low unemployment, disability claims had a big drop which improved the outlook (401kspecialist, 2018). According to Gail Buckner, a retirement planning expert at Franklin Templeton Investment, Social Security is doing a lot better than most people think. 

An increase of 2.84% to the tax rate for Social Security would solve the funding problem for an extra 75 years. 2.84% would be a split between the employer and the employee, each would pay 1.42% extra. According to Buckner, this makes many people relived. 

Other changes are already taking place. Some of the changes for 2019 include a higher Social Security tax cap, an older full retirement age and bigger earning limits (USnews, 2018). 

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Should you hold off on receiving your benefits?  

Should you hold off on receiving your benefits?  


If you are not in need of money, you can delay receiving retirement benefits after your full retirement age, and increase your monthly payments in the future. 

For example, if you were born in 1943 or later your benefit will increase 8% annually from full retirement age until you start receiving your benefits or age 70. If you start receiving your benefits at age 70, your monthly benefit would be increased by 32% (SocialSecurity, 2018).


When should you apply for Social Security?

When should you apply for Social Security?


When you reach your full retirement you will not receive your benefits immediately. If you wish to receive your benefits when you reach your retirement age, you have to apply 4 months prior. 

The earliest you can apply for your Social Security is age 62. Depending on your full retirement age, your benefit will decrease. If your full retirement age is 66 and you start receiving benefits at 62, the benefits is reduced 25%. However, if your full retirement age is 67, your benefits will be reduced by 30% (SocialSecurity, 2018). 

How is Social Security paid? 

How is Social Security paid? 

Social Security is an inter-generational transfer of wealth. Taxes that are paid by today's workers are being used to fund the benefits for today's retirees. You might think that you collect your own money because of the "Personalized Social Security statements" that are sent out annually. They include your payment history and your projected monthly benefits.

Today, you can view your Social Security statement online. You can easily set up your account today. For instructions, click on the button below.