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The Social Security Issue – How to Protect Your Finances in the Future

The U.S. takes care of its citizens over the age of 65 better than any other country on the planet via Social Security and Medicare. These “brilliant” programs have been successful parts of the U.S. economy for many years.

The difference between the U.S. and other countries like Indian is that here the government helps to take care of the elderly, at least in a financial way. In India, the family takes on this responsibility. This is why Indians, on average, save a much larger percentage of their money than Americans do. They save for many reasons, but the main reason is to be prepared to care for their parents when the reach a certain age. This is a great system for many reason, but monetarily, it may only work well to a certain point.

Eeven though Indians save a larger percentage of their income, many of them earn a fraction of what Americans earn today and, therefore, are unable to cover large medical costs and unexpected accidents that the future may bring.

In a perfect world, Social Security and Medicare work like a charm by providing the financial support needed by anyone over a certain age or with a specific disability.

So what’s the problem? – There’s no such thing as a perfect world!

According to a recently newsletter from the Social Security Administration, all of the money paid to social security right now is being put into trust funds and then distributed to current beneficiaries. “… based on current law, in 2037, the trust funds will be depleted.”

This means that everyone currently under the age of 33 will not be receiving Social Security benefits when they retire, but are required to pay Social Security taxes on every dollar they make.

But here’s the “good” news. The Social Security Administration goes on to say, “However, this does not mean that Social Security benefit payments would disappear… there will still be enough funds in 2037 from taxes paid by workers to pay about $760 for every $1,000 in benefits scheduled.”

Great! Not only are most people under the age of 33 today NOT going to get the full benefit (only 76%), but now the rest of the money is going to come from additional taxes and our already growing national debt (which everyone knows is terrible for the future value of our money).

Ok, so what can YOU do in order to avoid social “insecurity” and create financial security for yourself and your family?

Follow the example of the Indians. Save your money on a regular basis. Increase the percentage you save. Invest for long-term gain.

You may be thinking, “If Indians struggle to pay for things even after they save, why would we want to do the same?”

Three reasons:

1. Because you earn more than they do.
2. You have access to better/cheaper medicine and doctors than they do.
3. If you stop and think about it, there’s really no other solution.

Saving your money and letting it grow for you in order to keep up with inflation (which is another story saved for another day) is one of the smartest things you can do right now.

Start saving today!

For other advice on how to save and manage your money in creative and effective ways go to http://financialsecrets101.com. With their free 5G Plan you will be sure to find a little taste of financial freedom.

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