Damilola Esebame at TheStreet reported on what a projected Social Security shortfall means for women. The trust fund is on track to deplete in late 2032, which would trigger an automatic cut of about 22% for everyone. Women already collect less, an average of $1,760 a month versus $2,198 for men, and they rely on the program more heavily and for longer, so a flat percentage cut lands harder on them.
My advice for the piece was the same one I give in my office: retirees and pre-retirees should plan as though benefits will be reduced rather than eliminated. The program is not disappearing. Congress has fixed it before and the pressure to fix it again is enormous. But planning for the ideal outcome is not planning.
For women specifically, three things matter. Run the retirement income plan against a 20% to 24% benefit cut and see whether the spending still works. Coordinate claiming with a spouse, because the survivor benefit a widow receives depends on when her husband claimed, and that decision is often made without her at the table. And build income sources that do not depend on the trust fund at all: personal savings, a pension if one exists, and a portfolio structured to produce income.
A plan that survives a benefit cut is a plan that survives almost anything Congress does.
Read the full article at The Street →
