Expert reveals the secret to setting yourself up for success in retirement

Do you feel secure about your retirement?

Ahead of the anticipated 2033 cuts to Social Security benefits, Jed Warshaw of Ramsey Solutions explains how one can set themselves up for success.

“If you’re trying to transition from work to retirement, Social Security should not be your parachute,” the personal finance expert stressed during an interview on Tuesday’s episode of “The Big Money Show.”

The Social Security Fund is heading towards bankruptcy without any reforms

Relying solely on Social Security after retirement will not allow for full coverage, Warshaw said, because benefits will cover only a portion of a person’s income.

“As it stands, I mean, it will only be 40% of what people used to make.”

According to the Social Security Administration 2024 Annual Trustees Report, The benefits are projected to go bankrupt by 2033. If no legislative reforms are made, benefits will be cut by 21%.

As the 2033 deadline approaches, Warshaw warned that benefits “may no longer even exist” and offered advice to those who want to secure themselves financially for retirement.

“So I say to Americans, listen, prepare yourself for success.” “We tell people to take three to six months to pay off all their consumer debt,” he added. [income] You have savings, and then you should invest 15% of your gross income every month to build a retirement fund that is secure for you.”

Social Security benefits are expected to go bankrupt in 2033, according to the annual trustee report. (iStock)

Warshaw also reiterated fellow personal finance expert Dave Ramsey’s advice that people who plan to collect a benefit at age 62 should keep it invested as long as it’s invested.

,You know, if you get to age 62 and you say, ‘Listen, I don’t really need Social Security, I’ve got my own nest egg,’ yes, take that money early, ‘ He said.

However, she warned that pulling profits early would result in lower distributions, but ultimately agreed with Ramsey’s advice that profits should be invested despite early pullouts.

Personal finance expert says it’s important to be ‘thriving’ in retirement

About People Who Need “Everything” As for the benefits, the finance expert offered a solution: Wait until age 70 to take the maximum distribution possible.

“For some people, there may be a narrow medium of both, where you can continue to work and collect Social Security.”

Regarding taking benefits while still employed, he said, “Just know that there will be limits on the income you can earn without them being penalized.”

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Disclaimer : The content in this article is for educational and informational purposes only.

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