Question: “How should we plan for our retirement spending if we planned on social security income and we may not get it?”

This is a common concern among many of our clients, especially given the frequent alarming headlines suggesting that Social Security may run out of money. These headlines grab attention and boost ratings, but they don’t always tell the full story. Here’s a more balanced view and some practical advice on planning your retirement spending with less reliance on Social Security.

Understanding the Reality of Social Security

It’s important to understand the current state and future projections of Social Security.

Current Status: Yes, if no changes are made, the Social Security Trust Fund is projected to be depleted by 2035. However, this doesn’t mean Social Security will disappear; it would mean that benefits might be reduced to about 83 percent of promised benefits.

Likelihood of Changes: The probability of no adjustments being made to the system is very slim. Historically, policymakers have made changes to ensure the continuity of benefits. As noted recently in a newsletter from Bestgate Advisors, Congress is unlikely to make changes that would severely impact those close to or in retirement, due to the political implications and the desire of elected officials to be re-elected.

Uncertainty: While we can’t predict exactly what Social Security will look like in 20-30 years, it’s safe to assume it will still exist in some form.  It is most likely that any changes to benefits will impact younger individuals, who have more time to incorporate changes into their plans.

Role of Government and Policy Insights

Potential Reforms: Various reform proposals aim to ensure the long-term viability of Social Security.

Raising the Retirement Age: One proposal suggests raising the full retirement age from 67 to 68 immediately, then gradually increasing it by two months each year. This would address 44 percent of the funding gap.

Adjusting Payroll Taxes: Another proposal suggests raising the cap on FICA payroll taxes. Or, alternatively, subjecting all earnings to Social Security taxes to fill the gap.

Benefit Adjustments: Modifying the formula used to calculate benefits to slow the growth rate of future benefits.

Given these uncertainties, it’s wise to plan for Social Security as a supplementary income source rather than your primary retirement fund.

Planning for Retirement with Minimal Dependence on Social Security

To plan for a secure retirement, consider these steps:

1. Assess Your Retirement Goals and Expenses

Start by estimating your retirement expenses. Consider the following categories:

Housing: Mortgage, rent, maintenance, property taxes, and utilities.

Healthcare: Insurance premiums, out-of-pocket costs, and long-term care.

Living Expenses: Food, clothing, transportation, and entertainment.

Debt Repayment: Any outstanding debts that will continue into retirement.

Inflation: Account for the rising cost of living over time.

Bucket List Items: Don’t forget the fun stuff! You want to make sure you build room into your retirement budget for those wish-list items you’ve been waiting for. 

Having a clear understanding of your projected expenses will help you determine how much you need to save.

2. Maximize Retirement Savings

With uncertainty surrounding Social Security, it’s crucial to maximize your contributions to retirement savings accounts such as:

401(k) Plans: Take full advantage of employer-matching contributions.

Individual Retirement Accounts (IRAs): Both traditional and Roth IRAs offer tax advantages.

Health Savings Accounts (HSAs): For those eligible, HSAs provide tax-free savings for medical expenses, which can be significant in retirement.

3. Consider Alternative Income Sources

Explore other potential sources of retirement income such as part-time work. And don’t forget to factor in potential passive income such as investment and rental income. See if there is a way you can start getting your money working for you now without taking on a second full-time job.

4. Plan for Healthcare Costs

Healthcare is one of the most significant expenses in retirement. Consider Medicare, supplemental insurance, and long-term care, to name a few. 

5. Create a Contingency Plan

Having a contingency plan can provide peace of mind. This might include:

•   Emergency Fund: Maintain a fund with 6-12 months of living expenses.

•   Insurance: Adequate health, life, and possibly long-term care insurance.

•   Estate Planning: Ensure wills, trusts, and powers of attorney are up to date.

Tools and Resources

Financial Calculators: Online tools and calculators can help you estimate your retirement needs and evaluate different scenarios. Websites like AARP and financial institutions offer valuable resources.

Books and Articles: Further reading on retirement planning and personal finance can provide deeper insights and strategies. Consider books by respected financial experts and articles from reputable sources.

Financial Advisors: DIY financial planning isn’t for everyone. If you’re ready to start building your financial plan with the guidance of a professional, look for an advisor who’s right for where you are on the journey. Remember, if you’re ready to retire, look for an advisor who specializes in retirees!


While the potential loss of Social Security benefits is concerning, proactive planning can help ensure financial stability in retirement. By maximizing savings, diversifying investments, exploring alternative income sources, and planning for healthcare costs, you can build a robust retirement strategy that doesn’t rely solely on Social Security. Additionally, staying informed about potential policy changes and continually adjusting your plan will help you navigate the uncertainties of retirement planning.

Disclaimer: This article is for informational purposes only and should not be considered financial planning advice. Please consult with a certified financial advisor to discuss your specific situation and plan.

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