America is Financially Screwed (How To Save Yourself)

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THE SOCIAL SECURITY CRISIS:
Social Security is funded through payroll tax, at a total rate of 12.4% – and as you get older, you draw from a Social Security Fund to pay through retirement / supplement your income.

However, it’s said that, without any changes – “the social security fund is slated to be drained by 2033, which would result in an automatic 21% cut to beneficiaries’ monthly checks, regardless of marital or income status.” To make matters worse, it’s reported that “Older people are expected to outnumber children for the first time in U.S. history by 2034. There will be fewer workers to support each retiree in the future as a result.”

Essentially, we don’t have enough workers paying into social security to fund the full benefits of the baby boomers, which theoretically means that everyone else gets less.

THE ISSUE:
If nothing is done, we could see one of the following:

-One: Social Security Benefits will be reduced by the time all of us retire (most likely to the tune of 21-25%)
-Two: They Increase The Retirement Age So That They Can Pay Out Less Money (for example, instead of taking social security payments at 67 years old, perhaps it’s only available for those who are over the age of 72)
-Three: The Government Increases Taxes To Pay For Higher Expenses.

THE SOLUTION:

I hate to say it, but – REALISTICALLY – in order to keep Social Security fully funded, that’s most likely going to mean higher taxes in the near future, AND /OR a delayed retirement age so that fewer people can draw on those reserves.

At the end of the day, though: NO, I don’t think Social Security is going anyway anytime soon – and, if I’m giving my own prediction – I’d say you should be prepared to eventually pay higher taxes while they raise the retirement age another few years.

Again, all of this should serve as a reminder that – even though the government is there – you will go MUCH FURTHER by saving and investing on your own, living below your means – and, no matter what – hitting the like button and subscribing if you haven’t done that already.

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