What does the future of Social Security mean for your retirement?
Social Security remains a critical component of most American’s retirement plans and questions persist around its long-term solvency. While the number of Social Security beneficiaries is expected to continuously grow over the next decade, payments into the program via payroll taxes are likely to slow. This dynamic is creating anxiety for many about whether they can rely on Social Security to help fund their retirement. It can be beneficial to explore the role that Social Security may have in your retirement and how to best prepare if there are meaningful changes to the program.
The future of Social Security. If you have been following financial news, you may have heard industry pundits commenting on the solvency of Social Security and its ability to pay full benefits over time. Indeed, Social Security is currently paying out more than it is taking in, which many view as problematic. In May of this year, the Social Security and Medicare Trustees released their annual report,
(Financial
which predicts that by 2033 assets of the program will be depleted. It is expected that in 2033, the Social Security’s Old-Age and Survivors Insurance (OASI) fund will only take in 79% of tax revenue needed for benefit payments. As a result, payments under the program could be reduced by 21%1. It’s widely expected that Congress may act to shore up the program before this happens, however there are no guarantees. Planning ahead can help shield your retirement income, should Social Security be unable to fully meet its obligations.
Determine the role Social Security has in your retirement plan. It is important to understand where Social Security fits into your retirement plan. For many retirees, Social Security benefits provide key supplemental income because the program alone will not provide enough income to cover all essential and desired lifestyle expenses. Additionally, each individual’s benefits will vary depending on their lifetime earnings and the age at which they begin taking distributions. If future payments are adjusted lower to make up for the deficit of flows coming into the fund when you retire, it may be wise to plan on utilizing other means for retirement income. Take some time to determine your desired
lifestyle during retirement and the associated costs, so you can craft a Social Security plan that aligns with your retirement goals.
Work with a financial advisor to adapt your retirement plan. A financial advisor can help determine the optimal payment plan for Social Security in your retirement. The age at which you begin taking distributions and where these distributions fit into the whole of your retirement plan is unique to you. An advisor can assist you in evaluating the variables that may impact the time at which you begin collecting benefits such as your health and life expectancy. With careful financial planning you can consider a variety of income producing investments that may contribute to your retirement security.
How Social Security programs morph and change in future is largely outside of your control, so plan for what you can. It is never too soon to work with a financial advisor to plot various scenarios for retirement based on factors that are unique to you. Ultimately, knowing you’re prepared can help you feel more confident about retirement.
1- Ameriprise Financial: “Did You Know...” May 8, 2024. Compiled by Russell T. Price, Chief Economist Duane J Lusson, CFP, ChFC, CLU, MSFS, is a Private Wealth Advisor with Ameriprise Financial Services, Inc. in Ottumwa, Iowa. He specializes in fee-based financial planning and asset management strategies and has been
practice for 33 years. To contact him, call 641-684-4200 or stop by his office at 527 W. Second in Ottumwa, Iowa.
Investment products are not insured by the FDIC, NCUA or any federal agency, are not deposits or obligations of, or guaranteed by any financial institution, and involve investment risks including possible loss of principal and fluctuation in value.
Ameriprise Financial cannot guarantee future financial results.
Securities offered by Ameriprise Financial Services, LLC. Member FINRA and SIPC. © 2024 Ameriprise Financial, Inc. All rights reserved. File # AMP6892308.1-
BARN
A Little Mud on My Shoes
My wife and I spent the week of Thanksgiving at our son’s house in Houston, Texas. It is what one might call culture shock, going from the boondocks in Iowa to a sprawling metropolis such as Houston. Where my son lives, a few hundred acres of what was a cow pasture has been converted into a residential area consisting of several thousand lots which are rapidly having large houses built on them. The neighborhood has been landscaped with walking trails, small lakes, and native plants and trees. Even with the thousands of people living in the neighborhood, nature still abounds. Waterfowl and shore birds have moved into the man-made lakes and streams. Rabbits and squirrels co-exist with people and their pets in the green spaces.
The biggest problem that confronts me is finding my way around the maze of streets, highways, and
walking trails. To me, it all begins to look the same after a while. When my son and daughter-in-law were visiting our place, she was afraid she would get lost going for a walk as there were no streets or sidewalks. I thought at the time that this was rather strange. I orient myself by the position of the sun, certain trees, or change in terrain. I could not imagine getting lost in the timber or walking around the farm. In Houston, there are too many streets and sidewalks. Orienting oneself to the position of the sun does no good if a person is walking around in giant circles. Being a new neighborhood, all the trees are the same size and type. The terrain has all been created and looks the same from one area to the next.
One evening, a couple from next door stopped by for a visit. During the course of the evening, conversation turned to the differences of where we lived. The wife wondered if we were afraid, living so far from other people in a remote area. I found this to be rather humorous. I did not tell her but I would be much more uncomfortable living so close to so many other people. My closest neighbors are deer, turkeys and raccoons. The most trouble I have with them is they occasionally eat the plants in the flower beds or get into
the trash. I would be much more concerned about the intentions of any number of the millions of people living in close proximity.
I can see the advantages of living in a big city. There is an almost unlimited number of restaurants, shopping centers, and entertainment venues. A person never has to get mud on their shoes. I can also see the disadvantages to city life. There is more traffic on the roads at any one time than I knew existed. Six, eight, and ten lane highways are congested at any time of the day or night. The noise is constant. Even in the neighborhood away from major highways, a person can always hear traffic, sirens, or dogs barking. There is no such thing as quiet outside.
I guess that is why we say different strokes for different folks. Some people cannot understand living out in a rural area, away from the city. As for me, I prefer the peace and quiet, away from crowds and I do not mind a little mud on my shoes from time to time.
Another Time
It wasn’t exactly your ordinary Thanksgiving Day. I set the alarm for 6:15 a.m. A good time to get up to start preparing a Thanksgiving Day feast – but I was only doing part of the cooking this year. Still, sometimes plans change.
The first plan had me doing cranberry relish, sweet potatoes, dinner rolls, and pies. I made the relish Tuesday. (It’s best after resting at least 24 hours.) Then a friend delivered a pumpkin pie to my in-laws. One less pie to make; I was good with it either way and I’d still get to make the apple pie. I was looking forward to that.
You see, when Melissa first told her Dad I would be baking an apple pie for him for Thanksgiving, his eyes lit up bright and a smile shot across his face. “That would be really great,” Phil said with anticipation; it’s his favorite flavor. But then Wednesday afternoon, another friend delivered an apple pie to the house. I didn’t want to disappoint Phil, but now we already had an apple pie from a nearby bakery – and a Granny Smith Apple pie at that.
Plans changed again, and I was asked if I could
make the full meal on Thursday. To some this might be a burden, but I love cooking and happily agreed. But plans changed one more time.
As we were leaving my in-laws home on Wednesday night, I was told of another change; someone else would be roasting the turkey. I was back to cranberry relish, rolls, and sweet potatoes, sans the pies. Again, no problem, even though I’d already bought the pie ingredients. “Sorry about the pie changes,” someone said as we were leaving. “Tom will find something to do with the apples. Maybe another time.”
I learned years ago, things will change when cooking holidays meals. I can either roll with the changes, or get frustrated. It makes for a less stressful holiday to just roll with it. Still, I know that ‘another time’ frequently slips away, and never happens.
I didn’t want that. Melissa and I returned to the cabin we had rented near Pickens, South Carolina.
I kept thinking about those words, ‘another time.’
Even though I had little cooking to do Thursday, I finished up some things in the kitchen and then set my alarm to get up early. I’d made some changes in my own plans.
When the alarm sounded, I nudged my wife, “Are you getting up with me?”
“I didn’t sleep very well,” she said. “I need more sleep. Maybe tomorrow morning.” Although I understood why she was staying in bed, I didn’t want to wait for another
time. Who knows when, or if we’ll ever stay at this cabin again?
I climbed from our warm bed, went to the kitchen, and made a cup of coffee. It was still dark, lightly raining, and chilly when I walked out onto the deck with my cup of joe. “Melissa may have been right. This would be a good day to stay in bed,” I said. I passed the log furniture on the covered part of the deck, and then removed the lid from the hot tub. I turned on the aerator, then climbed into the tub with my coffee.
The 102-degree water was quite a contrast to the 44-degree morning air. I had to ease myself into the hot water before completely sitting down. It was awesome - especially with cold rain drops falling lightly on my head and shoulders. I sipped my coffee and enjoy the serenity of the rain falling in the woods surrounding the cabin, and on the tin roof of the porch. As dawn broke, a breeze began softly moving the windchimes. Hearing the sweet music of the pipes gently bumping each other, the raindrops falling, and sounds coming from the forest was like having my own personal symphony to serenade me.
Despite all the backand-forth changes from the night before, nothing could disturb the peaceful feeling I experienced on this Thanksgiving morning, and I had plenty for which to be thankful. Besides, there have been years with bigger changes, and obstacles to overcome; even in the
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Carolinas. I began to recall old memories.
One Thanksgiving at my daughter’s house in North Carolina, I had baked two pumpkin pies. Sydney took a bite of pie and her face puckered. When I took my first bite of pie, I noticed something terribly out of order. I knew immediately what I did. “Don’t eat the pie,” I told every-
one at the table. “I forgot the sugar!” Although this could be considered a disaster, I had a plan. I scraped the custard from the rest of the pie slices, along with the second pie, into a large mixing bowl. This time I added the sugar, and then mounded the filling to the uncut pie shell. Having no idea how this would turn out, I baked the pie for another thirty minutes. The flavor of my new creation, twice baked pumpkin pie, was as good as ever – the texture was not. We all had a good laugh about that, and certainly did not let it dampen our festivities. But the pie wasn’t the biggest improvision I’d made on Thanksgiving Day.
In 2012 it was Melissa’s turn to host Thanksgiving for her family at our house. “Aren’t you remodeling your kitchen, Tom? How’s that coming along,” I was asked. The suggestion was to move Thanksgiving that year, and Melissa could host another time. But this would be the first time she’d host the event for her whole family and I was determined to help her make it a great day.
“I am going to remodel
(Just the Other Day cont’d on pg 5)
(Just the Other Day cont’d from pg 4)
the kitchen,” I said, “But I haven’t started yet.” I was reminded Thanksgiving was only five weeks away. “Not a problem,” I assured. “It’ll be done.” To accommodate the work schedules of our guests, Thanksgiving dinner would be served on Black Friday. Three weeks before Thanksgiving, I gutted the kitchen. Remodeling, as with any project, will come with changes.
“As long as the walls are open, it only makes sense to install new plumbing going to the upstairs bathroom,” my brother Dan the plumber, said to me. And so, we did, thus incorporating a bathroom remodel along with the kitchen. Still, I wasn’t worried.
My cousin Andy custom built our cabinets and he
had them ready to install.
Each day I cut out of work a little early to keep going on the kitchen remodeling. When the ceiling and walls were done, Andy came and installed the cabinets. Brown’s Kitchen Center measured for the quartz countertops and installed them a day later. Still, we were pushing the deadline. Brother Dan returned to install the sinks and finish the plumbing. “This dishwasher isn’t going to work,” Dan said. “The handle sticks out too far.” That meant another trip to Des Moines – time I couldn’t afford, but it had to be done.
Finally, we finished the kitchen at 12:30 Friday morning. I got up at 7 a.m., and started cooking in the new digs, while Melissa was cleaning, setting tables and preparing for our guests. Sydney, Del-
Sheep Goats Ducks Chickens FOR
aney, and Annie jumped in and helped.
Shortly after 1 p.m., we were serving a full turkey dinner, with all the fixings, to 17 people. It would have been 18 people, but at the last minute, our friend Verna decided she would stay home. She said she would feel out of place with our family, “I’ll find something to eat around here.” Despite my pleas for her to join us, I wasn’t going to change her mind. “Maybe another time,” Verna said.
We ate well, all was delicious. After dinner, we prepared a turkey dinner plate for our dear friend Verna, from the old neighborhood. I included a small slice of both pumpkin and apple pie. Several of us walked over to deliver the dinner, visited with Verna for a bit, and then returned home.
By evening we started baking cookies. Melissa’s
brother, Jeff, put a fire in the fireplace. Carol and Betty took turns playing the old antique piano, filling the house with beautiful music. Phil joined in with his guitar and we sang songs, from gospel hymns, to Johnny Cash and John Denver. The last of our company left around 11 pm. Melissa and I sat and watched the fire burn down, while listening to Annie laughing upstairs with a friend who was spending the night.
I started to count my blessing, but all too quickly ran out of fingers. God has been good to me. Life is good and I have a darn good dog as well. I couldn’t have been more proud of my wife in the way she hosted her first Thanksgiving Day, perfectly!
I reminisced until it occurred to me, it was daylight now and I could see the warm water had my fingers looking like
prunes. It was time to get out of the hot tub.
We loaded our car and headed to my in-laws, where I would make the sweet potatoes and dinner rolls. In the kitchen, I said, “I got thinking about what was said, about making an apple pie for Phil another time. But I don’t know when another time will come, so I went ahead and baked an apple pie for him last night.”
Phil’s eyes lit up, and he smiled from ear to ear, when Melissa presented her dad with his apple pie. We had a wonderful Thanksgiving with family, and many more good memories were made. Eventually Melissa and I drove back to our cabin. We would be leaving, headed for home the following day.
My alarm went off before daylight the following morning, I made a cup of coffee and headed out for the hot tub. It was 32 degrees and there was ice on the puddles around the deck. I slowly lowered myself into the hot water. Soon, Melissa came out and joined me for coffee in the hot tub. We enjoyed the sunrise and watched a hawk land in a tree nearby. He watched below, waiting for something to come by for his breakfast. It was an amazing final morning for this visit to South Carolina.
I hope we can do this again another time.
