It is true that the government has and will continue to look after people. After all, you pay your taxes and make your social security contributions, right? That being the case, then, there is very little point in putting away for retirement savings and you may as well spend up big. After all, you will be looked after, so why bother going without, and saving? Well, the truth in many ways depends on your situation. But consider the following before continuing to spend away your retirement:-
Lots of numbers, but the government will still look after me, ok?
Yes they will, but there will be lots of other people to look after as well. What this means is that benefits are not likely to keep pace with inflation; are likely to become means tested, and if you think there is red tape now to get on board, wait a while. But that’s not fair; I have paid in my contributions all my life! Fair has nothing to do with it. Ask anyone involved; there is not going to be enough to go around, and it will get tougher.
In early 2011, the average monthly Social Security benefit paid to a retired worker was $1,177. This amount changes regularly and is based on a calculation that considers the total amount paid and the number of recipients. Is this enough for you to live on? What if you live another 10 years? What if you or a near one get sick and needs more care than your hospital cover will provide?
OK, by now you may not be feeling so great about all this, but if you are still reading that means you are interested. So what can be done? The answers are complex and vary according to what other financial activities are in your life. But the message is clear. You need to plan, you need to get involved, and you need to seek the opinions of more than one adviser. A good place to start is the Social Security Planner. There is a lot of material online, and there is help available through financial planners and retirement advisers. Words to the wise though; do your homework first. It is confusing; it is difficult; but it is your life and your future.
Before parting with any cash or signing up for anything, ask around. There is a lot of free help available, and after hearing what to do from a number of sources, you will start to see a common thread and work out what works for you. Have a look at USA government retirement information resources where there is some good information to help you estimate your retirement benefits and to learn about factors that could affect your retirement.
So where to from here? Whether you are retiring soon, or just in your twenties, the sooner you get a plan and understand the possibilities, the more likely your retirement will be just as you imagined, and likely to be even better! By sitting sound and waiting for whatever comes, you may be more than a little disappointed. The choice at the end of it all is yours. Go on; get involved, you have earned it!
Byline: Albert Ramirez is a term life insurance expert. In addition to no medical exam life insurance, he provides great insight for people looking to get the most out of their life insurance policies.
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