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You’ve probably heard that 2032 could be a big year for Social Security. According to a nonpartisan report Congressional Budget OfficeThe vital trust fund that helps finance Social Security benefits is on track to reach bankruptcy in 2032. If so, benefit cuts could be implemented if Congress does not act.
The impact of Social Security cuts may be greater than many Americans expect. Here’s what the average couple may lose in annual benefits.
‘Serious’ numbers
As reported LuckSome estimates suggest that a typical couple retiring at age 60 could see a cut of $18,400 per year when Social Security ends.
Andrew Lokenath, founder of expert in financeThere was a similar estimate. “Most people assume that Social Security will just be ‘there’ when they retire,” he said. “The statistics are sobering. A typical middle-class couple currently collecting Social Security could lose about $16,000 to $18,000 per year if the automatic deductions were triggered. That’s a car payment, a mortgage supplement or an entire year of groceries wiped out overnight.”
‘Breathing Room’ Money
When he speaks to retirees, Taylor Kovar, CFP, CEO 11 financialSaid that amount usually represents breathing space. “This includes things like rising insurance premiums, travel, gifts for grandchildren or the ability to not worry every time the market drops,” Kovar said.
If Social Security benefits see a reduction, retirees will need to plan how to fill those gaps. “Most people are not assuming that Social Security will go away, but they are more open to planning with a little margin,” Kovar said.
