Relying Solely on Social Security Upon Retirement

Consider ourselves lucky that we are not living in the Great Depression, when you can only retire from work when you are no longer able, either because you are too old, too sick, or dead. To solve that problem, social security was introduced, paying the workers a retirement benefit when they reached the age of 65.

It was meant to provide them means of living their finals years in relative comfort. However, there came a time when social security became a retiree’s only source of income. It was not a bad idea back then since quality of life for many people over the age of 65 was very low.

But times have changed, retirees live a better life even after their working life, spending on activities that they could not do while they were working. That quality of life comes with a price, and relying on social security alone to pay those expenses may not be a good idea.

Why social security alone does not provide a secure retirement

An employee who decided to fund his retirement solely with his monthly social security benefit check may realize too late that his monthly take is one-third or one-fourth the amount of his monthly salary. If he lists down all of his monthly expenses including car payment, utilities, groceries, gasoline, and insurance, he might he left with a small amount of savings.

However, these expenses do not include vacations, visits to children and grandchildren, or any other frills he wants to enjoy. The remaining amount may not even cover the cost of hospitalization if he, God forbid, gets injured or sick and needed medical attention.

This is why it is very important to start planning and saving for your retirement as soon as possible. The earlier, and abler, you can save up for retirement the better.

 

Posted by Ardent Editor on Aug 1 2008 in Social Security

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