4 Ways to Prepare for Social Security Running Out of Money
What do you do if Social Security runs out of money? There are many articles talking about how it will happen, when it will happen, and why it will happen.
In the video above, we aim to provide four key behaviors and strategies to ensure your financial stability if Social Security were to run out of money or stop entirely. Here is a quick written summary of our “Social Security Doomsday Survival Guide”.
We help you get the most out of your retirement AND your money. Schedule a free consultation with us to learn more about working with our fee only, fiduciary financial advising team to help build your retirement plan.
Know Your Numbers
It's crucial to understand your fixed and discretionary expenses, your after-tax income, and your savings rate.
Fixed expenses are those you can't control, like rent or mortgage, while discretionary expenses are those you can control, like entertainment or dining out.
Knowing these numbers helps you understand what you can control should your income projections not come to fruition.
Take Control of Your Income, Expenses, and Savings Rate
Once you know your numbers, you can influence them.
This might involve asking for a raise, starting a side hustle, or controlling your spending.
The more you save and invest, the more "insured" you are against running out of money in the future.
Don't Save Blindly
Diversify your savings and investments.
Don't put all your funds in one place or one investment type.
For example, don't save all your money in cash or invest all your money in your 401k.
Spread your money around different "buckets" that have different tax consequences.
Build a Plan
Understand the required rate of return you need on your investments to support your financial needs without Social Security.
Know what expenses can be cut and build multiple "what-if" scenarios to plan for contingencies.
We help you get the most out of your retirement AND your money. Schedule a free consultation with us to learn more about working with our fee only, fiduciary financial advising team to help build your retirement plan.
Summary
These are not just strategies for a potential Social Security shortfall, but good financial principles in general.
Take control of your financial future by understanding and influencing your financial behaviors.
Other Financial Planning Resources:
A Guide to Financial Planning Costs
What is a Flat Fee Financial Advisor?
What are Sequence of Returns Risk and the Retirement Risk Zone?
If you found the information above helpful, click here to watch my free Masterclass training that explains how you can increase your income in retirement by up to 30% and avoid running out of money in retirement.
