For years we’ve been seeing the writing on the wall regarding the unsustainability of programs like Social Security, and the dire need for people to put in place a financial Plan B. I’m sure many of you have seen the recent news about Social Security and Medicare becoming bankrupt ahead of predictions — not to mention the fact that by 2034 Social Security benefits will be slashed by 23% under current law. These are dire times indeed for Social Security and Medicare, and as more and more baby boomers retire the issues will become even more visible. Millennials are starting to catch on to these trends too bearing witness to what their parents, aunts, uncles, family members and friends parents went through, and ultimately sacrificed as well.
That’s not to blame boomers for this predicament, not at all. The problem lies in the simple fact that in 1940 the ratio of workers to social security beneficiaries was 159.4 to 1. In 1950 that number was 16.5 to 1. In the most current data from the Social Security Administration (2013), that ratio is 2.8 to 1. This downward trend will only get worse in the coming years and should force everyone to do some hard thinking about their financial plan(s) and retirement situation — no matter how old you are, this affects you directly.
Are you relying on the government’s Plan A (Social Security/Medicare) to be there for you when you step away from work and retire? I’m not. Many people will be in for a rude awakening if that’s the case. The government doesn’t have a working Plan A, and they don’t even have a Plan B in sight — so what are you doing about it?
I truly feel bad for those who will be adversely affected by the impending Social Security and Medicare downfall, and hope they wake up to the reality of the situation and take control of their economic future and lifestyle. Put an asset in place today that your future self and family will thank you for!
My Very Best,