Social Security is usually the first thing considered when people start to think about funding their future retirement. Unfortunately, by the time many of us reach that age, we will be seeing decreases in Social Security benefits. People could possibly only get 70% of what they are entitled to. What’s the game plan now?

In September 2020, two months before Election Day, Americans started to see more money in their paychecks. That’s because the payroll tax (Social Security and Medicare) we are accustomed to seeing deducted every pay period was deferred until tax time — five months after Election Day.

That means the Social Security Administration, whose entire budget is designed around a steady flow of income from the payroll tax, would have to wait until Americans filed their taxes to receive any more money.

Now that secure future is looking a little shaky and more unstable. What can you do about it? What can be done to help safeguard your future now, sooner than later? Is Social Security dead?

Here are a few tips:

  • Access benefits wisely: Claiming Social Security at 62 may be tempting, but it is recommended to wait until 70. Patience will be rewarded with higher monthly benefits. But with the possibility of Social Security running out, it might be best to take it as early as possible. Weighing the options is crucial.
  • Don’t take the government’s word for it: Social Security call center representatives often give the wrong answer. If the rep you are talking to doesn’t seem like they are knowledgeable, hang up and call again. It is recommended to consult your financial advisor or your CPA before you make any decisions. People have one year to change their minds and start over if they pay back the benefits they received.
  • Don’t leave money on the table: Things like divorced spouse benefits will allow many to compare two different benefit plans: someone’s own; or half of their ex-spouse’s — if they were married for more than 10 years. Again, it’s important to talk to your financial planner or CPA.
  • Use all resources available: An article in Investopedia points out that the Social Security Administration has a variety of calculators and estimators to help you make an informed decision, including Retirement Estimator, Benefits Planner, and Life Expectancy Calculator. They are all free, so make good use of them.

There’s a lot to consider, but remember, receiving benefits, changing your mind, and deciding to wait gives you only a year to think about it. After that, it is too late. Waiting means you’ll get more benefits, but is it worth the wait when nothing could be left? It is possible that the trust funds that go toward Social Security benefits will be depleted by 2034. Take that into consideration when weighing the pros and cons. Is Social Security dead? Only time will tell.

Judy Heft is the CEO/founder of Judith Heft & Associates, a financial and lifestyle concierge celebrating 26 years in business helping people stay financially organized. She is a certified money coach and the author of “How to Be Smart, Successful and Organized with Your Money.” For more information, visit www.judithheft.com.

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