6 ways Social Security will be changing in 2020:
For many of you, Social Security will be a major part of your retirement income. Which is why you need to know how it is changing in 2020.
Share to facebookShare to twitterShare to linkedinEither you can catch the wave of Social Security and Medicare changes, or you can get wiped out.GettyEvery day, 10,000 or so baby boomers are turning 65. Some of you have probably already retired. Many are likely counting the days until they can leave the full-time workforce. For many of you, Social Security will be a major part of your retirement income. With that in mind, it is important to know how Social Security will be changing for 2020.
Here are six ways that Social Security will be changing in 2020.1) Dipping into the Social Security Trust FundWithout some major action from Congress, the current excess trust fund revenue will be depleted by the year 2034. If this occurs, it is estimated that Social Security would only be able to pay less than 80% of the promised benefits from ongoing payroll taxes.
Donald Trump has thrown out lowering the payroll tax in an attempt to spur the economy. If the government takes this action, the Social Security trust fund would likely be depleted faster.Turning 65 ain't what it used to be. Full retirement age is now closer to 67 for most baby boomers.
Getty2) Full Retirement Age Has IncreasedFor those still a few years away from retirement, those born in 1960 or later, the full retirement age has increased to 67. You will still be able to start taking Social Security Retirement Benefits at age 62, but with reduced monthly payments.
Related:3 Retirement Myths That May Ruin Your Financial Plan3) Cost of Living AdjustmentLow inflation is a good thing for consumers, as it means pricing isn’t going up that quickly. On the other hand, lower inflation numbers mean small cost of living increases for your Social Security benefits. In case you didn’t know, your Social Security benefits may be increased each year, partially depending on inflation numbers.
For 2020, the Social Security cost of living adjustment is expected to be around 1.8%. Not life-changing, but if you are living off of Social Security alone, every penny counts. For the average retiree, this would likely amount to around $25 more per month. For the highest earners, this could come closer to $50 more per month in Social Security retirement benefits.
You may be shocked at how little the maximum social security benefit is.Getty4) Maximum Social Security Benefits Will IncreaseFor workers near the top of the Social Security income scale, $132,900 or more for 2019, your maximum Social Security payout will likely increase slightly in 2020
. No individual at full retirement age can take home more than $2,861 per month, regardless of their pre-retirement income. This number can be increased by delaying Social Security until the age of 70. Oprah won’t get more than this at full retirement age, neither will you.
Could you live off of $34,332 per year?I would not find that a pleasant standard of living here in Los Angeles. You can take home more than this amount in Social Security benefits if you delay your benefits until you reach the age of 70, but still, it would be rough to get by in most big cities.
In case you were wondering, waiting till 70 could increase your Social Security benefit by 32% compared with the starting benefit at 66. This takes the maximum monthly benefit up to about $3,776 per month.5) More of Your Social Security Will be Taxed
Yes, your Social Security benefits are taxable. The amount that is hit with taxes will depend on household income levels. Just fifty percent of your benefits will be taxed if your income is between $25,000 and $34,000 as an individual. That goes up to $32,000 to $44,000 for a married couple, still another example of the marriage penalty.
Hopefully, everyone reading this will have more income than that to live off in retirement. If so, 85% of your Social Security benefits will be taxable. That is assuming you have an income in retirement above $34,000 (individual) or $44,000 as a married couple.
Great retirement planning can help you have a happier retirement.Getty6) End of Two Great Social Security Maximization StrategiesFile and suspend was a great social security maximization strategy that is no longer available to younger Americans. The last few baby boomers who were grandfathered into eligibility will turn 70 in 2020. Seventy is the latest you can wait to start your Social Security benefits.
Related:6 Big Tax Mistakes That Can Ruin Your Dream RetirementI may joke that congress doesn’t do anything, but they did manage to take action to prevent people who reach full retirement age in 2020 (or later) from filing for a restricted claim of spousal benefits. Like file and suspend, this was a strategy to help
smart couples maximize their Social Security benefits. Thanks a lot.Whatever your age, take a moment and register for access to your Social Security Benefit estimates. Visitssa.gov, just take a few minutes and you will be able to find more information about Social Security, and more importantly, what it will mean for your retirement.
Think about your Social Security benefits when you vote in 2020 as well. With record deficits and the skyrocketing national debt, there are rumblings of draconian cuts from Trump and the Republicans to programs like Social Security and Medicare. Read more: Forbes »
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Well there goes my 906$ a month Most people's utility bills are more than this + insurance on the home & property taxes.. I forgot i do not get to eat, I have to use that money for gas. Life is wonderful. The bill is sitting on Moscow Mitch's desk to fix all this. Would change the lives of millions of Americans and boom our economy. But why would some sleazy rich guy from Kentucky care about his country enough to pick up a piece of paper and sign it?
Elizabeth Warren proposes major expansion of Social SecuritySen. Elizabeth Warren on Thursday unveiled a proposal to overhaul and expand Social Security, beefing up benefits with a hike in payroll and investment incomes taxes on some of the country's wealthiest households. I thought the House already had passed plan to raise social security and strengthen it, the raise would be about $200 a month Are you paying for the increase? The fake Indian, a person without integrity, spouts off all kinds of grand things in an effort to buy votes. But there is no money to pay for it. CNN is an ASSET for the democrats, socialist/communist.
Warren unveils far-reaching Social Security planWarren’s proposal would increase payroll taxes and establish new investment taxes on the highest-earning Americans. gillsterein She’s lurched center with her not-really-Med4All plan, so it’s either a net wash or perhaps even an inch towards the center Vote DEMOCRATIC no matter who. No one can sit home because the candidate that they supported is not on the ballot. Don’t get mad VOTE and get the REPUBLICANS OUT OF DC. it is a must for the survival of our democracy. Vote Democratic all the way no matter who!! The middle class can’t pay anymore!
Elizabeth Warren proposes sweeping increase in Social Security benefits, financed by wealth taxesSen. Elizabeth Warren proposed an across-the-board increase in Social Security benefits, financed by new taxes on high-income Americans. Socialism She will not be well received by Wall Street she will lose should she get the nomination Free free free
A top Senate Democrat unveils plan to revamp the capital gains tax, fund Social SecuritySen. Ron Wyden, the ranking Democrat on the Senate finance committee, proposes raising taxes on capital gains to the same rates as ordinary income. Will they get to Mark to Market their unrealized losses? Of coarse a thieving Democrat wants to take other people’s hard earned money! Lower capital gains tax.
Elizabeth Warren Urges New Social Security Taxes on WealthySen. Elizabeth Warren is proposing new taxes on wealthy Americans for the Social Security trust fund, making her the latest Democratic presidential hopeful looking to tap the coffers of the nation’s top earners. Hell yes. the problem with all ponzi schemes is eventually you run out of other people's money! 🙄👎