August 1st, 2010
Axia College of University of Phoenix
Social Security is Not a Retirement Plan
If you plan on retiring when you are 65, make sure you are ready. Planning for retirement is very important and the earlier you start, the more stable you will be when the time comes. You may believe Social Security will be enough to cover your needs when you retire but given the certain circumstances regarding Social Security today, you may want to think again about your future finances. Think about what kind of lifestyle you want to live when you retire. Setting financial goals to meet you retirement expectations is very important. Breaking down the everyday expenses like the costs of living, including bills, food, rent, or mortgage. Family costs like paying for your children’s college education and other costs of their well being, possibly supporting your parents, or trust funds for family members and heirs. Then there are the extra retirement costs like vacations, hobbies, and entertainment. Think about how expensive these costs are today, and how they are only going to increase in price over time. With the inflation rate increasing three to four percent every year (Baijtelsmit & Rastelli, 2008), there is no possible way Social Security can finance all your retirement needs if you plan on living comfortably and here is why. Social Security is already has a $12 trillion dollar unfunded liability and it is foreseen that the number is only going to grow with time (Social Security PRAs). Even people who are retired cannot solely rely on their personal Social Security benefits. I have done two interviews with two retirees. Jerry Weinburger (personal communication, July 2nd, 2010) who retired 10 years ago is 72, lives on his own, pays all of his bills and is fairly happy. He does receive Social Security benefits. I asked him how much money he receives in...