The Social Security Trust funds are depleting and that could mean bad news to both current and future beneficiaries of the program. Social Security is financed via two revenue streams, payroll taxes to workers and funds from the Old-Age and Survivors Insurance (OASI). Since payroll taxes are not enough to cover the benefits the program distributes, the difference is covered by the OASI fund.

But this fund has an expiration date. According to data from the Social Security Administration, the fund will be depleted by 2033, less than ten years from now, and, if combined with the other fund responsible for benefits, the Disability Insurance (DI) Trust Fund, the deadline is extended to 2035. This is not the first time that the program has been under water and has needed Congressional help to keep working, but the deadline for the cuts is approaching and there is no solution in sight.

This is bad news for those who either depend on the program now or are planning to do so in the future, as without these funds, the amount of Americans that could plunge into poverty is alarming. The best thing future retirees can do is to not wait for lawmakers to solve the issue, but to prepare in advance so that retirement is as independent as possible from public funds.

What to do to prepare if you’re still working

For those who are still drawing a salary and are not dependent on fixed income to survive, the advantage is important and not to be underestimated. Knowing that you have a few years to prepare might help you to redraw your budget and allocate a bigger share to savings in order to bridge the gap between the expected funds and the reality of what is to come.

The Internal Revenue Service (IRS) has created to this end some measures called catch up contributions that allow workers over 50 to boost their savings potential in 401(k) or IRAs. Investing in solid portfolios and growing personal savings will be the key to a safe and happy retirement.

If you are still in the workforce, it means that you can also have the chance to evaluate your retirement plans. For example, you may have wanted to retire at 62, but if your personal finances would not allow this to happen, you have time to pivot and wait a little longer. Even if 62 is the earliest age at which you can receive Social Security benefits, the amount is nowhere near enough for most families to live on, especially when considering medical expenses, so waiting until at least Medicare benefits kick in might be a good idea.

What to do if you’re already retired and rely on Social Security

Retired individuals have less options, but that does not mean that they are powerless to improve their situation. One of the easiest things that able bodied retirees can do is join the gig economy to boost their income. This could allow them to build a nest egg just in case cuts do end up happening. If they started tomorrow, they would have ten years to save money.

Relocating to another a part of the country where Social Security benefits go further is also an option, although leaving friends and family behind is not easy, those who live in especially high cost of living areas would be surprised at the difference in lifestyle. The best thing retirees can do is to weigh their options, balance their budget and take a real look at their finances. This will help them determine the measures they will have to take to ensure that cuts to benefits do not impact them negatively.

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