{"id":709,"date":"2017-07-10T18:21:00","date_gmt":"2017-07-10T18:21:00","guid":{"rendered":"https:\/\/webhostingnola.com\/wmsgroup\/?p=709"},"modified":"2024-10-17T18:25:18","modified_gmt":"2024-10-17T18:25:18","slug":"are-you-relying-too-much-on-social-security-for-your-retirement-income","status":"publish","type":"post","link":"https:\/\/webhostingnola.com\/wmsgroup\/2017\/07\/10\/are-you-relying-too-much-on-social-security-for-your-retirement-income\/","title":{"rendered":"Are You Relying Too Much on Social Security for Your Retirement Income?"},"content":{"rendered":"\t\t
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According to recent studies, too many retirees make that mistake. More than 60 percent of retirees rely on Social Security for over half their income. Social Security provides more than 90 percent of income for a third of those individuals.1<\/sup><\/p>

The truth is that Social Security likely won\u2019t provide enough income to fund your desired lifestyle in retirement. For many workers, Social Security replaces only a third to half of their preretirement earnings. You may need additional income sources to supplement your Social Security benefits.<\/p>

If you\u2019re behind on your retirement savings or haven\u2019t started yet, the good news is that you have time. Below are a few strategies to help you create supplemental income after you stop working. If you haven\u2019t implemented these steps, now may be the time to do so.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Maximize your qualified retirement accounts. <\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Do you have a 401(k) plan, IRA, or other qualified retirement account? If so, are you contributing as much as you could to those accounts?<\/p>

Qualified retirement accounts can be powerful retirement saving vehicles because they are tax-deferred. That means that you don\u2019t pay taxes on your investment growth as long as the funds stay in the account. Instead, you pay taxes when you withdraw the funds in the future. In the case of the Roth IRA, you may never pay taxes on your growth.<\/p>

Tax-deferral could help your funds accumulate at a faster rate than they would in a taxable account. Since you\u2019re not paying taxes on the growth every year, your funds can continue to compound. If you\u2019re using a 401(k), you may also benefit from employer matching contributions, which could accelerate your savings rate.<\/p>

While it\u2019s important to contribute to your retirement plans, it\u2019s also important that you resist the urge to take early withdrawals. Early distributions from retirement accounts can have big consequences. One is that a distribution can slow your account\u2019s growth. The less money you have in your fund, the less capital that\u2019s invested and available to compound.<\/p>

A distribution from your retirement plan can also lead to taxes and penalties. Most retirement accounts are tax-deferred, which means you don\u2019t pay taxes on growth while the funds are in the account. Distributions at any age can be taxable. Distributions before age 59\u00bd can trigger a 10 percent early withdrawal penalty.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Create a side income stream. <\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Retirement is supposed to mark the end of your working years. However, many retirees are reframing retirement as an opportunity to transition from their career into new opportunities. Consider creative ways to generate income while you also maintain a flexible schedule.<\/p>

For example, you could work part time in a seasonal job. You could teach lessons or classes, or use your expertise to provide consulting services. You could rent out property or drive for a ride-hailing service.<\/p>

Retirement doesn\u2019t have to mean that you no longer work. In fact, some form of earnings may be just what you need for a stable financial foundation. Once you reach full retirement age, earnings don\u2019t impact your Social Security benefit, although they could affect the amount of your benefit that\u2019s taxable.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Payoff your debt.<\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Granted, debt elimination isn\u2019t technically supplemental income. However, eliminating debt can have the same impact as generating additional income. If debt payments make up a significant portion of your budget, consider implementing a focused plan to eliminate as much debt as possible.<\/p>

You may want to cut back on expenses so you can allocate more money toward debt paydown. Also, consider transferring balances to debt with lower interest rates, which may allow you to pay off the debt faster. You could downsize to a smaller home, which could minimize or even eliminate your mortgage and other housing costs.<\/p>

Ready to develop your retirement income strategy? Let\u2019s talk about it. Contact us today at WMS Group. We can help you analyze your needs and create a plan. Let\u2019s connect soon and start the conversation.<\/p>

1<\/sup>https:\/\/www.fool.com\/retirement\/general\/2016\/04\/02\/9-social-security-facts-the-ssa-wants-you-to-know.aspx<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice.<\/em><\/p>

The material is not intended to be legal or tax advice.\u00a0The insurance agent can provide information, but not advice related to social security benefits. Clients should seek guidance from the Social Security Administration regarding their particular situation. The insurance agent may be able to identify potential retirement income gaps and may introduce insurance products, such as an annuity, as a potential solution. Social Security benefit payout rates can and will change at the sole discretion of the Social Security Administration. For more information, please consult a local Social Security Administration office, or visit www.ssa.gov<\/em><\/p>

16767 – 2017\/6\/20<\/em><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

Social Security is likely to play a large role in your retirement. After all, it\u2019s a valuable resource that can provide base of guaranteed lifetime income. However, as helpful as Social Security may be, you probably don\u2019t want to rely on it as your primary source of income.<\/p>\n","protected":false},"author":1,"featured_media":711,"comment_status":"closed","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11,12],"tags":[],"class_list":["post-709","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-retirement-planning","category-social-security"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/webhostingnola.com\/wmsgroup\/wp-json\/wp\/v2\/posts\/709","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/webhostingnola.com\/wmsgroup\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/webhostingnola.com\/wmsgroup\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/webhostingnola.com\/wmsgroup\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/webhostingnola.com\/wmsgroup\/wp-json\/wp\/v2\/comments?post=709"}],"version-history":[{"count":5,"href":"https:\/\/webhostingnola.com\/wmsgroup\/wp-json\/wp\/v2\/posts\/709\/revisions"}],"predecessor-version":[{"id":717,"href":"https:\/\/webhostingnola.com\/wmsgroup\/wp-json\/wp\/v2\/posts\/709\/revisions\/717"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/webhostingnola.com\/wmsgroup\/wp-json\/wp\/v2\/media\/711"}],"wp:attachment":[{"href":"https:\/\/webhostingnola.com\/wmsgroup\/wp-json\/wp\/v2\/media?parent=709"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/webhostingnola.com\/wmsgroup\/wp-json\/wp\/v2\/categories?post=709"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/webhostingnola.com\/wmsgroup\/wp-json\/wp\/v2\/tags?post=709"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}