I have always looked at Social Security as one leg of the retirement stool, with personal savings, and a pension if you have one, as the other legs. Many retirees no longer have a pension and have placed their Social Security benefit in higher regard. Social Security was always meant to be a supplement to retirement, not the base of retirement income that is has become, and now we hear that the trust fund is in trouble. We have been saying the trust fund would be depleted sometime around 2036, and the Medicare fund around 2028. The Social Security Trustees are now projecting that the Social Security trust fund will be depleted in 2034, with the Medicare trust fund hitting the wall in 2026. What does this do to your benefit?
We have already seen some changes as to how we claim our Social Security benefit and the full retirement age for many taxpayers has been pushed back. There is talk of “means testing” Social Security benefits in the future. Means testing could take the form of more income taxes, a reduction in benefits, a surtax or some other method. Anyone who has done a good job saving for their retirement on their own should consider the chance that Social Security benefits will be means tested in the future. What we know right now is that current tax withholding will provide Social Security benefits for many years in the future. We have not heard of any changes either currently or projected that would reduce anyone’s benefit. While nothing is written in stone, I imagine any changes to the Social Security system will be discussed at great length and not made without much discussion.

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