I love getting these Social Security Statements in the mail! They always show how much you’re worth when you’re old and wrinkly ;) Haha… actually, I like to see how much my income fluctuates between the years. These statements track alllll your (reported) earnings since you’ve started working. Or at least mine does since I’m only 30.
Wanna see my total combined income in the history of ME? This is the first time I’m calculating this so you’re in for a treat! (and I’m probably going to cry afterward realizing how much money has been SPENT over the years, haha…)
|Years you worked||Your Taxed SS
|Your Taxed Medicare Earnings|
How insane is that? I’ve earned almost HALF a MILLION dollars over my lifetime! And spent over $300,000 of it! (Based on my recent net worth #’s, minus the cars and negative house net worth). But of course life is expensive and you have to spend money no matter how you slice it. Plus, you can always attribute lots and lots of financial mistakes due to your younger years ;) So by no means am I complaining here – I’m proud of what I’ve collected through it all! And prouder as the years go by, which I know you guys are working on too. So yay for us!!
If I continue working under these same earnings rates…
- And retire at 67, I’d get about $2,200/mo.
- If I work until 70, it would raise to $2,700/mo!
- And if I quit at 62, I’d be looking at a major decrease down to $1,500.
I also couldn’t help but notice all the financial tips and tidbits they put in their little ol’ newsletters. This is the first time I’m actually reading it! haha…
A few nuggets of Social Security info I picked up:
- Social Security will be depleted by 2037 (based on current law)
- This year more than 50 million Americans will collect nearly $614 BILLION in S.S. benefits.
- Currently, 9 out of 10 individuals age 65 and over receive benefits.
- And for 2/3 the elderly, Social Security represents at least HALF of their income. (Wow)
- For an average worker, S.S. replaces about 40 percent of annual pre-retirement earnings.
- Social Security protects you if you become disabled. “Studies show that a 20-year-old worker has a 3-in-10 chance of qualifying for disability benefits before reaching retirement age. (Did not know!)
- Social Security protects your family in the event of death. More than 2 million children and surviving spouses caring for children now receive survivor benefits from a deceased worker (Sad :( But also good to know!)
Will Social Security be around when I retire?
This is probably the most interesting part of the whole newsletter because it answers you but also scares you at the same time ;) And it’s also the most bolded part of the statement! Haha… guess they get a lot of questions on this. Here’s what they say, copied & pasted:
“Yes. The Social Security taxes you now pay go into the Social Security Trust Funds and are used to pay benefits to current beneficiaries. The Social Security Board of Trustees now estimates that based on current law, in 2037, the Trust Funds will be depleted. Because people are living longer and the birth rate is low, the ratio of workers to beneficiaries is falling. Therefore, the taxes that are paid by workers will not be enough to pay the full benefit amounts scheduled.
However, this does not mean that Social Security benefit payments would disappear. Even if modifications to the program are not made, there would still be enough funds in 2037 from taxes paid by workers to pay about $760 for every $1,000 in benefits scheduled.”
So, YES it will be around if you retire by 2037, and you’ll get a portion of it thereafter for a few years, but then? Well, there is no then. I guess we’ll have to wait for a few more statements to hit us before we see that picture.
Included were also some saving tips:
Very very basic, but still good to remind ourselves of:
- The sooner you start, the more time you have to save for retirement.
- Even setting aside a small portion of each paycheck will pay off in big dollars later: just $25 a week invested at 5% interest for 40 years will grow to about $165,000.
- Any amount you can save, even as little as $5 a week, will add up over time.
- The easiest way to save is through your job. Ask your employer if you can participate in a retirement savings plan at work. Your employer might even match your contributions to the plan.
- If your employer does not offer a savings plan, check with a bank or other financial institution for ways to save and invest on your own.
And lastly, a few websites they recommend (although sadly no blogs):
Who knew Social Security could be so fun ;) Did you learn anything today? Does this make you want to retire anytime soon? Or did I officially just become the most boring blog around? Haha…
Jay loves talking about money, collecting coins, blasting hip-hop, and hanging out with his three beautiful boys. You can check out all of his online projects at jmoney.biz. Thanks for reading the blog!