Anyone else worried about SS?

Or just make the 85% taxable into 100% taxable as will hit higher income folks.
The 85% is hitting people lower on the income scale every year because the thresholds are not indexed to inflation since they were set in 1983.

SS 'after tax' net benefits are being cut every year, but many people are not aware of it. I explained in detail here along with some references:

 
I don't spend a lot of time worrying about SS reductions as my own belief is that if no action is taken we will just see a 23% or so reduction. I live on my SS income having started it at 68.5 years and keep my retirement savings available for splurges or large purchases. So far I have not had much need for that so my WR is 0% these days although I will have to start RMDs in 2026.

If SS were to go away entirely, which I highly doubt, my RMDs would be more than I currently draw from SS so no change there. The big change would be how I invest my retirement savings. Today I am pretty cavalier in how I invest as I am tilted largely towards equities and don't keep a large amount of my money in "safer" securities like Treasuries, bonds or CDs. So if SS disappeared I would have to actually pay more attention to making sure I preserve my retirement funds which is more effort than I wish to deal with these days. I prefer my current 75/25 split, set and forget while vacationing a lot.
 
So, a 17% haircut based on 2024 numbers as opposed to a 20% haircut based on 2023 numbers.

Not exactly. 17%/20% is for the combined trust funds of retirement and disability insurance (DI). The DI portion is not projected to run out.

The retirement portion (OASI) is forecasted to be 21% short in the 2024 trustees report, versus 23% short in the 2023 trustees report. But for worst case planning rounding to a 20% or 25% haircut makes sense, anything else is overly precise without being accurate.

From the 2024 report on Page 6:
Conclusion
Under the intermediate assumptions, the projected hypothetical combined OASI and DI Trust Fund asset reserves become depleted and unable to pay scheduled benefits in full on a timely basis in 2035. At the time of depletion of these combined reserves, continuing income to the combined trust funds would be sufficient to pay 83 percent of scheduled benefits. The OASI Trust Fund reserves are projected to become depleted in 2033, at which time OASI income would be sufficient to pay 79 percent of OASI scheduled benefits. DI Trust Fund asset reserves are not projected to become depleted during the 75-year period ending in 2098.
 
Running Firecalc we are ok, even with a SS haircut of 20%. We just have to really manage our spending and stick to budget. If SS gets hit harder, we will need to tighten our belts.
Since my wife is still working and commuting, we haven't yet entered into our retirement spending scenario.

We had great "bucket list" plans for retirement ... travel, buying a camper trailer, etc. These are all discretionary spending and can be reduced if need be.

As for SS changes, I am thinking an income-based adjustment to benefits makes sense, along with others that have been mentioned.
See the bolded texts from your post above. Are you saying because your wife is still working, you are spending more money now, compared to how much money you would be spending post-retirement? If so, you should quit doing that and live now within the figure retirement budget. That can give you a better idea of whether your smaller retirement budget is realistic.
 
Have Roth distributions count towards determining the taxability of your Social Security benefit.
The problem with this is that it likely wouldn't generate much new revenue. Out of all my family and friends, I suspect that the one that don't pay taxes on their SS, are also folks that don't have Roth IRAs.
 
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The job application process is much easier now than when I graduated.

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Applying for a job now compared to 30 years ago involves several significant differences:
1. Application Process:
  • Then: Job applications were primarily submitted via mail or in person. Resumes were often typed on typewriters, and cover letters were handwritten or typed.
  • Now: Most applications are submitted online through company websites or job boards. Digital resumes can be easily created, formatted, and sent.
2. Technology:
  • Then: Limited technology meant less access to information about job openings. Job seekers relied on newspapers, bulletin boards, and word of mouth.
  • Now: Job seekers have access to a plethora of online resources, including job search engines, social media platforms (like LinkedIn), and networking sites.
3. Networking:
  • Then: Networking was often done in person or through direct acquaintances, making it a slower process.
  • Now: Online networking allows for broader and faster connections, enabling job seekers to reach out to potential employers and industry professionals easily.
4. Resume and Cover Letter Standards:
  • Then: Resumes were simpler and often one-page documents. Cover letters were formal and very structured.
  • Now: Resumes can be more creative and tailored to specific jobs, often including links to portfolios or online profiles. Cover letters may be less formal, focusing more on personality and fit.
5. Interview Process:
  • Then: Interviews were typically face-to-face and could involve multiple rounds at different locations.
  • Now: Interviews may be conducted via video calls, allowing for greater flexibility and access to remote job opportunities. There are also more varied interview formats, including behavioral and technical assessments.
6. Job Market Dynamics:
  • Then: The job market was less competitive in many fields, with fewer applicants for each position.
  • Now: The job market can be highly competitive, with many applicants vying for the same positions, especially in popular industries.
7. Diversity and Inclusion:
  • Then: There were fewer initiatives focusing on diversity and inclusion in hiring practices.
  • Now: Many companies actively seek to promote diversity and equity in their hiring processes, with policies and practices aimed at reducing bias.
8. Remote Work Opportunities:
  • Then: Most jobs required physical presence in the office.
  • Now: Remote and hybrid work models have become common, expanding job opportunities beyond geographical limitations.
Conclusion
Overall, the job application process today is more automated, technology-driven, and accessible, offering a wider array of opportunities and resources for job seekers compared to 30 years ago.

Unfortunately all of that automation has resulted in runaway issue of everyone applying for everything which has thereby overwhelmed HR departments so now they rely on automation to screen and ignore people. It’s brutal and disheartening to the people involved. The problem is complicated by HR rules that force jobs to be posted externally even in situations where it is already 100% clear which internal person is getting the job.

When I graduated from college, we went to job fairs, applied to jobs, got interviewed or not and almost invariably got a letter from the company politely declining to hire in many cases. We hung them outside our dorm room in the hallway for humor and comradery.

A very talented young friend of ours in undergrad B-school applied for 50 internships. He got ghosted by 48 of the companies. Got a job from one of the others. This is totally par for course. DD went thru a very similar situation.

It’s terrible.
 
Unfortunately all of that automation has resulted in runaway issue of everyone applying for everything which has thereby overwhelmed HR departments so now they rely on automation to screen and ignore people. It’s brutal and disheartening to the people involved. The problem is complicated by HR rules that force jobs to be posted externally even in situations where it is already 100% clear which internal person is getting the job.

When I graduated from college, we went to job fairs, applied to jobs, got interviewed or not and almost invariably got a letter from the company politely declining to hire in many cases. We hung them outside our dorm room in the hallway for humor and comradery.

A very talented young friend of ours in undergrad B-school applied for 50 internships. He got ghosted by 48 of the companies. Got a job from one of the others. This is totally par for course. DD went thru a very similar situation.

It’s terrible.
What does this have to with “Anyone else worried about SS?” Just start another thread…
 
What does this have to with “Anyone else worried about SS?” Just start another thread…
It started as part of my speculation that the younger generations may not accept the SS fix not impacting older folks already living on benefits.
 
I've been doing spreadsheets since 10 years before I FIRED and never did I include SS. I still don't.

My guess is they raise the retirement age for the folks 50 or below but don't touch us old farts who seem to vote.

Either way I'm fine.
 
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Anyone who retired in the last 10-15 years who assumed they would get Soc Sec with no reductions for life might get a nasty surprise - should have planned for less than full benefit.
IIRC, after the 1983 “fix” the depletion of the trust fund was first reported in 1988. Back then it was predicted to become depleted later than 2034, but each year or two the year of depletion got closer and closer. The main reason given was greater income inequality. The rich got richer and the poor got poorer.

So, we’ve known the depletion was coming for a real long time!

In fact, some say had the reports during the 1983 “fix” work used less ratios and more $ estimates it would have been evident back in 1983.
 
I guess it’ll be 2030 before anybody seriously tries to do anything again? They’ve already had several commissions which have generated fairly reasonable recommendations. If I wait till 70 as the higher earner I’ll be starting SS in 2029.
 
What can they do, burn the older folks on a stake?

No, but there may be political backlash that says part of fixing SS is that people in retirement (or within a few years) have to accept an x% reduction in benefits to stabilize the system as part of a wider package of fixes.
 
I do not for one instant believe that the cowardly congresscritters will allow SS benefits for current recipients to be cut at all. There are far too many for whom SS is their sole income and seriously cutting benefits for them would be a national catastrophe. Starvation could and would be a very real thing in this country. (It already is, but it's just not common and doesn't get publicity but I've seen it happen.) And as has been pointed out people over 60 vote in greater numbers than younger people. The politicians all know that.

I do believe that congress will do the same thing they did last time (1983) and wait until a week or so before they absolutely HAVE to do something and then "rescue" SS by some combination of cutting future benefits, raising FRA, and raising the income levels subject to SS withholding.

That said, if a cut to SS does come to pass DW and I will be all right as we also have a COLA'd pension and savings/investments, and there's enough slack in the budget that we could take a sizable SS hit and still be fine. We just wouldn't be quite as lavish with the gifts for grandnephews and grandnieces as we are.
 
Before I retired I modeled our retirement income and spending using any 2 of the 3 income sources available to us (pension, investments, SS). That revealed that we could still have a comfortable retirement in that situation. In reality, after six+ years of retirement living on pension, investments, and DW's very small SS, we have much, much more that when I retired. So at the moment, any change to my current plan to delay SS until 70 (a little more than 3 years from now) would not have anything to do with the potential for benefits to be cut. Other factors would change my mind.

I would not be surprised, however, if one of the solutions introduced is some time of "means testing" that will factor in one's income from other sources (and possibly one's assets) to determine how much one might receive in SS benefits. Since I will be receiving the maximum SS benefit, I will not be surprised if this impacts me.
 
Once again, I wish I had a dime for every predicted calamity that never happened.

In this case, I fully expect that there will be another last minute "fix" that'll kick this can down the road to 2053 or so.
 
I read something to the effect of,
The biggest mistake many people make is thinking they have plenty more time.

I think we need to buy that new ish car. :)

This may not be entirely logical or data driven, but I am not Mr Spock.
 
Well, it will be really interesting to see how it all plays out!

I have absolutely no expectations either way, or all the possible different ways?
 
I've been retired since 2009, and have had a chance to vary my spending depending on my financial situation at the time. For me, it's really not that hard. My house and car are paid off and I have plenty of (free) things to do for fun already. I'm pushing Frank to think of cutting back right now, just in case. So, basically we're not terribly worried about a hypothetical SS cut.
 
I get it, a lot of people on this board are not struggling and do not *need* social security, so the attitudes about cuts are very cavalier. However, there are millions and millions who are already living on the edge on SS alone.

Just raising the FRA for people entering SS in five years of so, is not going to fix the problem. Actual cuts to actual benefits actually being drawn will be required. Since cutting the benefits of the lowest earners will cause many to lose their homes, etc. they ONLY other options are raising the SS taxes, *OR* means testing in some form. Or both.

I believe, like others, that this emergency will be ignored until the last possible moment due to the guaranteed political fallout from any decision that is made. Then, the easiest decision will be made, which is to do means testing, and I don't mean cutting "rich people". Anyone getting a benefit above the median will be targeted, and there will be a sliding scale up to about a 50% reduction in benefits, based on MAGI, IMHO. Unfortunately, if they wait until 11:59:59 PM to do this, even those cuts, plus a rise in FRA, will not be enough. Expect some shenanigans with both Medicare, and the Disability Insurance trust funds to kick the can down the road a few more years.
 
As often discussed, if a SS haircut (or any relatively short money) makes the difference between a good, safe retirement and eating cat food in one's old age, maybe a full re-evaluation of the plan is in order.
Hear, hear!
 
That is a good idea. They should apply some of the giant Powerball jackpots to SS. Nobody needs a $Billion!
I agree that nobody needs a $Billion. Having said that, the $Billion dollar winner gets less than half of that. Various taxing authorities get the first dollar of it (and many, many more thousands of dollars - or millions) before the winner gets the first dime. Just MAYBE the gummint doesn't need hall the winner's winnings and could share part of THEIR windfall with SS??

On a different note: Lotteries are probably the most regressive "tax" that gummint has come up with but I don't want to be political about it.

On a more libertarian note, I don't see that anyone has a right to say what any one is entitled to. And, if so, how much? What is a "fair" amount to win at powerball?? Just asking.
 
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