818 Route 202-206, Bridgewater, NJ 08807
Telephone 908-722-6868, Toll Free: 1-800-392-0980, Fax: 1-908-722-2827, E-Mail: info@forefin.com

Can You Count On Social Security??

Unless you're very close to retirement age, you should be concerned whether you'll be able to count on Social Security Benefits. Many people mistakenly believe that their contributions over the years are accumulated in an account in their name and that they receive benefits from that account when they retire. There is a seven percent chance that your Social Security earnings may have been posted in error.

We recommend that you obtain a form from your local Social Security Office to verify your earnings have been correctly credited to your social security number. The Social Security Administration will also provide you an estimate of your social security payments at age 65 based on your past annual earnings.

The reality is that Social Security is a "pay-as-you-go" system, which means that current workers are paying the benefits for current retirees. By the year 2020, the system as it is currently designed will start paying out more in benefits than it collects in taxes.

If benefits stay at their current levels, that means that Social Security taxes will have to increase from their present level of 15.3 percent to at least 24.5 percent. Other alternatives are more likely:

Raise retirement ages
 While the retirement age is scheduled to rise from 65 to 67 by the year 2027, many are now suggesting that 70 is a more appropriate retirement age. In addition, the early retirement age of 62 may be raised or abolished.

Increase Social Security Taxes
 It is estimated that raising the Social Security tax by 2% now would make the system solvent indefinitely. The maximum wage used for assessing taxes could also be raised.

- Assess income taxes on a greater portion of Social Security benefits. Currently, recipients with income in excess of certain limits can have up to 85% of their benefits taxed. The income limits may be lowered or the maximum benefits taxed increased.

Reduce the annual cost-of-living increases
 Currently, benefits are raised annually to adjust for increases in cost-of-living. Increases may be made every year or a limited percentage may be paid.

Reduce benefits for higher income retirees
 Although the Social Security system was not designed to pay benefits based on need, that may become a criterion in the future.

While you can probably count on some help from Social Security, you're better off finding other ways to fund your retirement.

For additional information on your insurance needs or information about our Financial Services, call 1-800-392-0980, complete the inquiry request form, or simply E-Mail us at: info@forefin.com.