“Just like you and I, Social Security is going to change”
Nicole Livas: 10 On Your Side wants to help you plan for a comfortable retirement. So we headed to Langley Federal Credit Union to sort out part of a Social Security mystery.
Tom Schaad: It’s a financial forms set up to explain the current status of Social Security and what it may hold for your future. 10 On Your Side Eric Harryman joins us now with more on what you can do now to prepare.
Eric Harryman: Tom, Nicole, it comes down to realistic expectations and staying informed long before retirement age. Don’t get me wrong though. The daunting question of “Will there be any money left when I retire?” remains. But the experts say, “Worry less, plan more”.
Commentator: With the US economy in crisis mode, many believe Social Security could disappear.
Marsha Kilburn: Are there going to be funds there when we are ready to retire?
Commentator: Kevin and Marsha Kilburn had some very valid questions about Social Security, so they came here for answers.
Kevin Kilburn: Is there any money left?
Commentator: It’s a question many believe has no guaranteed answer. But at 52 and 54 years old, the Kilburns say, “It’s very scary for our children”.
Commentator: They’re nervous, and maybe they should be. Modern Social Security benefits began in 1942 with 5 workers for every 1 retiree. In 2008 the ratio hit 3 workers for 1 retiree. The estimate for 2030 is 2 workers for 1 retiree.
Earl Johnson: You’re going to need some pensions or some saving or something else besides Social Security, you’re going to need some other income.
Commentator: Earl Johnson works for Social Security as a public affairs specialist. He says that benefits will stick around, but don’t overestimate how much you will get.
Earl Johnson: Just like you and I, Social Security is going to change, but we’ll be there for you to provide you with the security that you need with regard to retirement.
Commentator: Or at least part of it. Financial planners claim maintaining a retirement income level equal to 70% of normal wages should leave most people comfortable. Johnson, however, warns that you should only rely on Social Security to provide 60% of that total. The other 40% needs to come from another source.
Earl Johnson: You’re going to got to have some kind of savings or pension.
Commentator: Tracking your progress, no matter how far away from retirement, is simple online. We asked Kevin, a 28 year old producer to try it out. At SocialSecurity.gov, choose “estimate your retirement benefits”. After you confirm your identity and current income levels click “create estimate”.
If Kevin maintains his current income level, at age 62 he’s get about a $1000 dollars a month in Social Security benefits. At full retirement age of 67 he’ll get about $1,502 and if he works until age 70 that amount jumps to almost $1,900.
You can also chose “create additional scenarios” to figure out just how much you’d have coming in at any age.
For the Kilburns it’s a tool that can make the retirement planning process easier and a worry less.
Kevin Kilburn: It’s almost like you’re ready to go through it. You don’t really know all this stuff.
Eric Harryman: And you need to, that’s for sure. Johnson says the year to watch is 2017 because that’s the year the amount withdrawn from Social Security will overtake the amount being deposited into it. Between now and then, Johnson says, expect some big changes at the federal level to prevent that from happening and, of course, you can go to WAVY.com to find more direct links about everything that we just talked about. But wouldn’t it be great to have a crystal ball?
Nicole Livas: Yes, it would.
Eric Harryman: You could at least figure out maybe what the result is going to be.
Nicole Livas: Lot of worries there, that’s for sure.
Tom Schaad: This issue has been going on for a long time. We haven’t heard the end of it.
Nicole Livas: Thanks, Eric.
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