Social Security: Social Security can’t do it all
Are you actively planning and saving for your retirement? Too many Americans are not.
I was recently surprised to read in one of our Social Security publications that, even today, about one in three older Americans relies on Social Security for 90 percent or more of total family income.
The average monthly Social Security benefit for a retired worker in 2005 is $955. For a worker and his or her spouse, the figure is $1,574. That income is enough to keep individuals and couples above the poverty level — but just barely.
So all of us at Social Security think this message bears repeating: Social Security is intended to serve as a financial foundation for your retirement years, and not as your sole source of retirement income.
If you are a worker age 25 or older, carefully review the annual Social Security Statement, which should arrive in your mailbox about three months before your birthday. If you think your income will change significantly during your career, you can use our retirement planner at www.socialsecurity.gov to plug in numbers of your own and see just how your eventual Social Security retirement benefit payments might be affected.
For the average American worker, Social Security will replace about 40 percent of his or her pre-retirement earnings. However, according to financial experts, you will probably need at least 70 percent of your annual working income when you retire to enjoy a comfortable lifestyle. The remaining 30 percent or more will need to come from private pension plans, savings or investments.
If you want to enjoy a long-awaited retirement, you will need to plan and save for it.