If you are like most adults, Social Security is an important component of your retirement plans -; almost 97% of the American workforce is covered under SS. However, the current state of the economy has many of us worrying about our future benefits. In this article, you will learn how the Social Security process works, and you will read an explanation of how funding shortfalls can affect your retirement benefits.
How Social Security Works
During your working life, you pay into the system through deductions from your earnings. In most cases, workers can see withholding by looking at pay stubs. Once you can no longer work, or when you retire, you can hire a Social Security Attorney to help with the application process. The amount you get will depend on the length of your working life, the amount you earned, and your retirement age.
As you pay into the Social Security system, you accrue credits to be used toward your later benefits. The credits required to retire with benefits depend on your birth date. For instance, someone born post-1929 only needs 40 credits (about a decade of work). You can’t get benefits if you stop working before that point, but if you go back to work, you can start accruing credits again.
Is the Social Security System Troubled?
In simple terms, yes. The next ten years will see a significant decline in the worker to beneficiary ratio, as baby bloomers move into retirement. The problem grows worse when longer life spans, declining birth rates and cost of living increases are considered. The resulting shortfall can’t be sustained, and without revenue increases, the Social Security system will be insolvent within the next fifty years.
Handling Issues in the Social Security System
In other countries, such as the UK, the government is pre-funding Social Security. Here in the US, this approach is under consideration, as are solutions like payroll tax increases and additions from the general fund.
Social Security is a safety net for millions of working Americans. If changes are made starting now, those changes will help to ensure that future generations of workers can also depend on Social Security benefits. For help in getting the benefits you deserve, call a Social Security Attorney today. & for more information visit Mcgillicuddylawny.com.
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