Since 1980, pensions plans have been phased out in favor of 401(k) plans. They now represent nearly one-fifth of the U.S. retirement market. So how did 401(k) plans become such a popular form of retirement savings and how should they be used? Watch the video to find out.
Tag Archives: Seniors Retirement
Retirement: How Monthly ‘Social Security’ Benefits Are Calculated (Video)
Planning to save for retirement might not be a priority. Luckily, you’ll have some help from Social Security. Different salaries can drastically raise or lower your Social Security benefits. Here’s how much you can expect, based on six different salaries. The average Social Security check in 2020 is $1,503. Figuring out how much you can expect every month when you retire depends on a few criteria. The size of your payment will be based on income from your working years, the year you were born and the age when you decide to start receiving benefits. Luckily, CNBC did the math for a wide range of salaries, and we can estimate your future benefits if you make between $30,000 and $100,000 per year. Remember: Social Security was not envisioned as your sole source of money for retirement, and the totals are always changing. Watch this video for a breakdown of how much you will get and how your monthly benefit will be calculated based on multiple different salaries.
Retirement: ‘How Social Security Works’ (Video)
Since 2010, Social Security’s cash flow has been negative, meaning that the agency does not collect enough money through taxes to cover what it is paying out. Even though there was still this vast trust fund behind Social Security, they started tapping that fund’s interest.
Starting in 2021, they will have to dip into the trust fund itself to cover those benefit payments, and even that pool of cash has an expiration date. Trustees of the fund expect that by 2035 it will not be enough to cover full benefit payments. Due to COVID-19, that date may come years sooner than expected, which has some retirees seriously worried about their future.