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Social Security Raises Alarm Bells for Americans
For many Americans, Social Security is a vital safety net that provides financial security during retirement. However, recent reports have raised concerns about the future of this program. In this blog post, we will explore the challenges facing Social Security and what it means for Americans.
A rising percentage of Americans are concerned about their capacity to support themselves in retirement, with over 71% of them voicing fear that the Social Security program may not be able to support them in their later years.
Set against the backdrop of the Social Security Administration’s recent announcement that the fund’s reserves are expected to be depleted by 2037, a survey conducted in December by the Transamerica Center for Retirement Studies, which included over 10,000 participants from a wide range of demographic backgrounds, reveals long-standing concerns about the program’s future in the face of uncertain legislation and unstable economic conditions.
According to the survey, Social Security is essential for people who are getting close to retirement. Lower-income households are most concerned about its potential reduction or elimination, and this worry crosses racial and gender boundaries, suggesting a national concern about retirement financial security.
Which Groups Are Worried the Most?
The concern of Social Security payments being cut or canceled is highest among families making less than $50,000 per year (36%) and highest among those making between $50,000 and $99,000 per year (40%), respectively, the survey states. In contrast, 38 percent of families earning between $100,000 and $199,000 and 39 percent of those earning above $200,000 are more fearful about outliving their resources and incurring long-term care bills.
Related video: How to Maximize Your Retirement Social Security Income (Money Talks News)
All racial and ethnic groups have the same concerns about Social Security retirement, according to the survey’s results. While 34% of Black people and 38% of White people anticipate using Social Security as their main source of income, 67% of Black people and 72% of White people worry about the program’s possible instability.
Concerns over the program’s sustainability are expressed by 75% of respondents who identified as Hispanic and 70% of respondents who identified as Asian American and Pacific Islander (AAPI).
According to the report, women are more likely than males to rely on Social Security and to be afraid of retiring.
Thirty-eight percent of women, vs 26 percent of men, say they plan to rely mostly on Social Security for their retirement income, and an equal number of women worry that the program may be cut or eliminated. According to the survey, women are more afraid of not being able to provide for their families’ fundamental requirements financially and of their being a shortage of affordable housing than men are. Men are also concerned about health care demands and outliving their assets at equal rates.
The Senior Citizens League of Bureau of Labor Statistics (TSCL) released data last week that suggests the 2024 Social Security cost-of-living adjustment (COLA) of 3.2 percent may not keep up with rising costs in essential areas, adding to the shared concerns amid persistently high inflation.
The Senior Citizens League’s Mary Johnson, a policy analyst for Social Security and Medicare, said in a statement, “Even in low-inflation environments, housing, auto insurance, hospital costs, and nursing home care are the money-guzzling black holes.”
According to the TSCL, even while overall inflation dropped to 3.1 percent, over two-thirds of older persons reported a ten percent rise in their monthly budget for housing, food, and prescription medicines compared to the previous year.
Even if some people are relieved, the COLA increase could not be enough to offset the skyrocketing costs that disproportionately impact the elderly.
According to the Social Security Administration, around 67 million Americans received a monthly Social Security payment in 2023, with benefits paid out totaling approximately $1.4 trillion. The Transamerica report raises red flags for politicians to reevaluate the program’s course amid rising reliance on it.
