Retirement Planning

Social security was not meant to pay for all retirement needs (let alone comforts). These benefits are not much. Yet it has provided a safety net for millions. In recent years the programs future has come into question for a good reasons; Social security is an unfunded program, meaning that social security taxes you today  are being used directly to pay beneficiaries. This is a transfer payment, not a pension plan. Social security was running surpluses for decades and the government was borrowing these surpluses to finance other parts of their budget. Now these surpluses are gone and this will not improve with the coming  “Aftershock.”

Due to the government borrowing this money from social security, with the federal government’s debt at almost 17 trillion dollars  and growing, there is a good chance that many people reading this article will never collect a nickel in social security benefits. The government will still offer a level of assistance , particularly for the elderly, but it will be means tested. (You will not get it unless you really need it). In order to maintain even this level of support will depend on significant tax increases on the middle and upper class. Because the federal government will no longer be able to borrow money, having maxed out its credit, no longer able to borrow money, and also because printing money will become self defeating, the government will need to strike a delicate balance:  taxing enough to provide for those in need but not too much to discourage people from working, particularly if the alternative is to collect hardship payments. The main point: the days of universal social security are over.

Preparing for this depends on your age, income, and job income and type as you approach retirement.

For older retirees age 55 plus, your 401K plan may allow you to withdraw your funds without a penalty. If you roll these funds into an IRA you’ll still have to wait until you are 59 1/2 to begin taking withdrawals without a penalty.  One of the best Ira’s to invest in would be those that purchase gold.

Should you take your social security benefits early? Yes. In the past it was best to wait. But as explained, social security will eventually be means tested, so it is best to take what you can while you can. Also if possible finding an extra part time retirement job may help as well. To find potential retirement jobs, you may consider looking on AARP’s web site,

To find additional information on how to navigate your retirement goals if you are younger or are older you may also consult :

The Aftershock Investor A Crash Course in Staying Afloat in a Sinking Economy by David Weidmer, Robert A. Weidmemer, and Cindy S. Spitzer