Katie Klingensmith, Chief Investment Strategist, Edelman Financial Engines.
You’ve seen the headlines. Social Security is “running out,” benefits are “at risk,” and retirement as we know it is changing. I hear from investors every day who feel anxious—not just about markets, but about whether they can count on Social Security at all. With an average of nearly 69 million Americans currently receiving benefits each month—and two-thirds of seniors relying on Social Security for more than half their income—the possibility of losing Social Security threatens to disrupt peace of mind and derail even the best laid plans. This anxiety is also exacerbated by misleading statements regarding enhanced deductions and the proposed elimination of taxes on Social Security benefits.
It’s understandable. Retirement planning is personal, and financial uncertainty can make the future feel less secure. But here’s the truth: Social Security isn’t vanishing. But it may evolve—and with the right planning, you can successfully navigate that change.
The Emotional Side Of Financial Planning
My company’s most recent Everyday Wealth in America report revealed something striking: When asked to choose between five extra years of healthy life and $1 million in retirement savings, more than half (51%) of respondents chose the money. That says a lot. Longevity doesn’t feel like a gift if you’re worried your savings won’t last.
This reflects a deeper truth: People want confidence and clarity about their future. And right now, that feels harder to come by—especially with headlines about depleted trust funds and shrinking benefits.
Here’s What You Should Know About Social Security
Yes, the system faces challenges. Without intervention, the Old-Age and Survivors Insurance (OASI) Trust Fund—which pays Social Security benefits—could be depleted by 2033. But even then, benefits won’t disappear—they’d likely be reduced to about 77% of current levels. That’s not ideal, but it’s a far cry from zero.
Another important factor to consider is that we’ve been here before. Lawmakers have known about these issues for decades—and when it’s mattered most, they’ve stepped in. While restrictions to Medicaid included in recent legislation may give cause for concern, Social Security remains popular across the political spectrum, and history suggests that the government will step in before 2033.
There are well-known solutions available:
• Gradually raising the full retirement age
• Modestly increasing the income cap or payroll tax
• Adjusting how benefits are calculated
These aren’t politically easy. But they’re viable—and history suggests that Congress will act when action is truly needed.
Planning For Uncertainty Isn’t Hopeless—It’s Smart
While you can’t control what Congress does, you can take steps to prepare for multiple scenarios. One common approach we use with clients is to plan as if you’ll receive 75% to 80% of your projected benefits. That way, if cuts happen, you’re ready. And if they don’t? You’re even better positioned.
From there, the question becomes how to fill the gap. Even nudging up your savings rate by 1% to 2% a year and directing those dollars into tax-advantaged accounts can add up over time. Just as important are steady habits that build resilience: automating contributions so savings happen without effort, keeping costs low and rebalancing periodically to stay aligned with your goals.
The key is consistency. Making these actions routine rather than occasional helps create a plan that remains durable across different economic scenarios, including the possibility of reduced benefits.
This is also a moment to rethink what retirement looks like. Our report found that nearly 4 in 10 Americans say they want an “adventurous” retirement. Others want minimalism, flexibility or travel. The old vision of retirement is being replaced with something more personalized—and your financial plan should reflect that.
The Bottom Line
Social Security may change, but it’s not going away. The real question is: How will you prepare?
With the right plan and steady habits, you can navigate uncertainty with clarity—and confidence. That’s not just good news for your retirement. It’s peace of mind you can count on now.
The information provided here is not investment, tax or financial advice. You should consult with a licensed professional for advice concerning your specific situation.
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