What will you do if your Social Security benefit is cut by more than 20%?
The future of Social Security, which faces a funding crisis in the coming years, keeps many people up at night.
Many financial planners and industry analysts are confident Congress will act in time to save the program. They say no politician wants to be known for gutting a crucial benefit to which nearly every working American is entitled. Social Security is crucial for many retirees. Half of the U.S. population 65 and older live in households that receive at least 50% of their income from Social Security benefits, and about 25% of older households rely on Social Security benefits for at least 90% of their income, according to the Social Security Administration.
“If you have five to 10 years to retirement, that can be a lot to come up with. If you’re younger, the more time you have to save and the more you can take ownership over your financial future,” Williams said. “The decimal point is less meaningful than it being a responsibility that’s yours and yours alone — it’s a responsibility I have in America to save for retirement.”Without any Social Security benefits, 37.
For some, saving that kind of money may be an insurmountable task. Nearly half of families have no retirement savings at all, according to the Economic Policy Institute. The average American has $65,000 in retirement savings, according to the Federal Reserve. “It becomes a question of, what are your options? If you have a retirement shortfall, you work longer, spend less or save more — or a combination of those,” Voyles said. “Does this force people back into the workforce?”
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