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The Social Security system in the United States is in deep trouble.
According to the 2024 Trustees report, the Old-Age and Survivors Insurance (OASI) trust fund, which pays benefits to retirees and survivors, could be depleted by 2033, leaving it able to cover only 79% of obligations.
With time running out, experts and lawmakers are divided on solutions, from benefit cuts and raising the retirement age to expanding revenue sources. And U.S. President-elect [Donald Trump campaigned on a promise to cut income taxes]https://moneywise.com/retirement/trump-social-security-taxes-seniors), a move that could drain the program’s funds even faster than forecasted.
Labor economist Teresa Ghilarducci, a renowned thought-leader on U.S. retirement issues, believes there are “many easy fixes” — here’s what she recommends.
Expanding Social Security’s revenue sources
Ghilarducci believes the solution to Social Security’s challenges is simple: bring in more revenue.
“We are past the point where we can fix Social Security by cutting benefits,” she told Bloomberg. “That is a non-starter because the benefits for Social Security are keeping almost all of the people on Social Security… above the poverty level.”
But sitting above the poverty level isn’t exactly the stuff of hallmark cards. If you’re concerned that Social Security might not replace your income and fully support the retirement you want, finding a professional advisor through WiserAdvisor could help you create a stronger bankroll for your golden years.
WiserAdvisor is a free matching service that connects you with a pre-screened financial professional whose expertise is tailored to your goals. Just answer a few questions, and WiserAdvisor will provide a personalized recommendation of two to three advisors.
You can then schedule a free, no-obligation consultation to find the right fit and start building a retirement plan beyond Social Security.
Grow a nest egg to supplement shrinking benefits
Building a solid nest egg is crucial for a secure retirement — especially if you want to rely less on Social Security.
Finance experts like Suze Orman have long touted the idea that by focusing on growing your retirement accounts and diversifying your investments, you can create a stronger financial foundation.
Equally important is having an emergency fund, which can protect your savings from unexpected expenses without jeopardizing your retirement goals.
Contribute to and diversify retirement accounts
In an era of economic uncertainty, securing your financial future may require a more proactive approach than in the past — one that goes further than old age security.
For instance, if you’re optimizing your investments for stability, gold is typically more stable than stocks during economic downturns and recessions. In fact, gold has increased in value sevenfold over the last 100 years.
These things are especially important for retirement planning. For instance, by opening a gold IRA with the help of American Hartford Gold, you can invest directly in physical precious metals rather than stocks and bonds.
American Hartford Gold is a leading dealer of precious metals, and offers IRAs and direct purchases of precious metals and coins.
You’ll get expert guidance to help you navigate the complexities of setting up and managing your IRA, secure storage with IRS-approved depositories, and flexible investment plans tailored to your goals — plus, transparent pricing with no hidden fees.
Sign up now for your free information guide to find out if a gold IRA is the right move for your retirement goals.
Make sure you have an emergency fund now and in retirement
While building personal wealth through smart, independent investing has never been more essential, it’s also important not to forget about putting aside an emergency fund — distinct from retirement savings so you don’t have to dip into long-term investments when unexpected expenses arise.
Daunting as it may be to think about, there are ways to manage your investments and your emergency fund in the same place that are less stressful and more hands-off than you would think.
You can check out Moneywise’s Best High Yield Savings Accounts of 2024 to find some savvy savings options that earn you more than the national average of 0.4% APY.
Like the sound of high yield interest rates? Then you might also be interested in exploring certificates of deposit (CDs).
A CD is a low-risk savings option that can yield interest comparable to, or even higher than, the top savings accounts. The trade-off for this higher rate is that your money stays locked in the account for a set period. For example, Discover offers CDs with competitive rates and terms ranging from three months to 10 years.
Currently, Discover’s 12-month CD offers a competitive 4.10% APY — significantly above the rate offered many large U.S. banks provide on similar accounts. Plus, Discover CDs have no fees, and there’s no minimum deposit required to get started.
If you want to invest and save at the same time, Public is a commission-free investing platform where individuals can build diversified portfolios, investing in assets like stocks, ETFs, and crypto — all with community support and real-time insights.
They also offer a high-yield cash account with competitive interest rates on uninvested funds, so that even your cash holdings see more growth over the long term.
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
