My grandfather jokes that he makes more now off of Social Security than he did when he was working. He will turn 90 this year, and I am turning 30. I remember reading about the need for Social Security reform when I was in high school and even wrote an article for my school’s papers. The bottom line: many experts were saying back then and still are that Social Security will not be available for us when we are ready to retire, or will be greatly reduced.
What does that mean for me? Well, I started a 401K plan at my first job out of college as soon as I became eligible. Now, seven years later, I have approximately $29K saved in my IRAs. The problem for others in my age group? They are delaying starting a personal savings plan, which can be a costly mistake for their future.
I don’t understand everything there is to know about investments, but I do know this: You need to start saving early and the longer you keep saving, the more money you’ll make over the long term. Maybe Social Security will be there for us (at least if IWPR where I work now, has anything to say about it) but Social Security was never meant to be a complete retirement package—it’s supposed to be combined with employer pensions and personal savings.
It’s not always easy financially to take out that extra $20 or $50 a paycheck, but I’m hoping down the line it will pay off for me with a secure (perhaps early?) retirement. I feel proud looking at my account to see what I’ve accomplished so far at my young age.
This also points out the need for reform, and for us 20-30 somethings to ask for change in the system. Yes we know we can’t rely solely on SS for retirement, but we have paid into the system with our payroll taxes, so we deserve and are entitled to fair benefits based on our contributions.
– Michelle Schafer