The future of Social Security is uncertain, and although this is not news, or the first time it has happened, it does seem to be the first time when the writing is so clearly on the wall and no solution is in sight. The country is very divided, and proposed solutions seem to be rejected by the other side of the aisle as quickly as they come up and there does not seem to be any consensus on possible solutions.

The problem of Social Security

Social Security is facing a shortfall, the program is expected to owe more in scheduled benefits than it collects in payroll tax revenue as baby boomers leave the workforce in masse for retirement. This usually would not be a problem, Social Security has trust funds to tap to make up that shortfall, except it has already been tapping into them and once those trust funds are emptied, Social Security will have to cut benefits across the board to make up the difference.

According to the most recent Social Security Trustees Report the Old-Age and Survivors Insurance (OASI) Trust Fund, which funds retirement benefits is scheduled to run out in 2033, 2035 if it is combined with the Disability Insurance (DI) Trust Funds (which is not expected to run out on its own unto 2098 due to the small amount of people it serves comparatively).

This means that there are roughly 10 years left to come up with a solution. And, although everything seems to indicate that the solution will come, after all Social Security is the most popular program in the country, waiting for lawmakers to make up their minds would be shortsighted.

What can future retirees do to improve their situation

For those who are still working, options are a lot more convenient than those who depend on the program. Increasing your savings and taking advantage of every policy the Internal Revenue Service (IRS) has rolled out to pad tax advantaged 401(k) or IRA accounts will be the first steps in ensuring that you have enough to live through retirement. The IRS has special provisions for workers over 50 to contribute more to their retirement accounts to help with this.

The stock market will also be your friend, think through your portfolio and talk to an advisor to get the best possible investment strategy that will help you for years to come. Reconsidering your retirement plans will be the ultimate decision you have to make. Retiring at 62 (the earliest you can claim benefits) will likely be out of reach for most, but if you have enough passive income and savings that does not mean you cannot take a step back and plan for a less stressful role. Waiting until age 70 to claim benefits is the ideal scenario, but if that is not an option just waiting for as long as you can is better than claiming at the first chance you get.

What to do if you are already retired

Retired individuals will have less options to improve their finances during retirement and be less dependent on Social Security, but that does not mean you should not try. Joining the gig economy to give your income a boost, taking a low stress part time job like pet sitting or waiting in a café could help you earn some money, keep connected to the world, and maybe even get a new retirement plan. Earning an income will give you more breathing room and will help you build up a small cushion you can dip into later if Social Security cuts do arrive.

Relocating to a less expensive part of the country can also be an option to those who live in high cost of living areas, but leaving friends and family behind can be hard, especially if you would move to a place without a safety network.

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