Social Security Outlook Makes TSP All the More Important

Social Security Outlook Makes TSP All the More Important. Can we count on Social Security in the future?

This question is related to the Thrift savings Plan because, if we can’t count on Social Security, we will need more income coming from sources such as the TSP and IRAs.

For the last two years, the report of the Social Security Trustees has said that Social Security would become insolvent by the year 2034. This does not, however mean that Social Security will not be able to pay benefits to those who have earned them once we hit 2034. The Trustees have said that, even if nothing changes for the worse, they will be able to pay 80% of promised benefits. 80% is way, way better than 0%.

In Congress, our elected representatives are asking themselves if it is 2033 yet. It is likely that many Senators and Representatives will have retired by that future date, so they don’t have the level of concern that most Social Security recipients (or future recipients) have. As long as politicians continue to think of the next election, instead of the next generation, we will continue to lurch from crisis to crisis.

There have been suggestions from various interested groups about how to “save” Social Security; and the suggestions vary widely based upon the constituency of the group that is making the suggestion.

Here are some of the suggestions:

• Gradually increasing the full retirement age (FRA). The most common age suggested is 70. Some suggestions would keep the age of 62 for reduced benefits, but the benefits will be reduced more for someone whose FRA was 70 than for one whose FRA was 67. Other suggestions would increase the age for early benefits to 64 or 65. Follow link to read full article: https://bit.ly/2Wn4aGJ