My husband is 39 and has been saving for some time.
My question is about Social Security.
Should someone in our age group expect to receive it at all?
Im always hearing about how Social Security is going broke.
Were both somewhat behind on where we should be on retirement.
At 37, Im just a tad older than you.
I expect to get benefits someday, and you and your husband should, too.
Theres a kernel of truth to the stories you hear aboutSocial Securityrunning dry.
Widespread job losses due to the pandemic probably accelerated things a bit.
But were still funding Social Security with ourpayroll taxes.
My bigger worry for young-ish workers like us is that our benefits wont go very far.
The average retiree benefit in January 2021 is just $1,543 per month, or $18,516 annually.
Social Security estimates that current benefits cover about 40% of an average workers pre-retirement income.
Those benefits buy less and less every year.
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The2021 cost-of-living adjustmentwas just 1.3%.
Ask any retiree whether thats adequate to cover their rising living costs.
The younger you are, the less of your income you should expect your benefits to replace.
That protects your retirement funds so you dont have to tap them when times are tough.
If you’ve got the option to comfortably save more, great.
If 15% isnt doable right now, figure out whats manageable and work your way up.
For example, you could commit to putting half of your next raise toward your retirement account.
Unfortunately, theres no level of savings that guarantees you wont have a rice and beans retirement.
The younger you are, the more guesswork goes intoretirement planning.
Did you know?
If everything goes as planned, Ill die with millions.
But really all of the above is just wishful thinking on my part.
Or if a prolonged bear market hits right as Im starting to withdraw my retirement money.
But too often in personal finance, we only focus on the retirement years, assuming that theyre guaranteed.
The truth is, life can be snatched from us at any moment.
That doesnt mean you get free rein to spend.
You dont have to figure out your entire retirement plan right now.
Robin Hartill is a certified financial planner and a senior writer at The Penny Hoarder.
Send your tricky money questions to[email protected].
(Can you sense my millennial sarcasm there?)
You know which ones were talking about: rent, utilities, cell phone bill, insurance, groceries…
