Beneficiaries have been worried about the future of their Social Security payments lately because the trust fund could run out of money by 2033. A recent report from the Social Security Administration says that one of the two main trust funds will definitely run out of money before that date.
Also, personal finance radio host and expert Dave Ramsey recently shared his honest thoughts on the state of the federal program. It’s important to remember that Congress will need to act to fix the solvency problem before 2033.
Financial experts issue warnings about the future of Social Security payments
People will keep getting Social Security payments even after the trust fund runs out if lawmakers do nothing. About 80% of the payments that are already planned would still need to be paid for by continuing payroll tax income.
The subject came up when someone recently asked Ramsey for help about a different government benefit. An email that Ramsey Solutions sent to The Street was written by someone who said they were Brandt.
“Dear Dave, we’ve been following your plan for a while now.” We only owe money on our house, but we don’t have any other debt. We also have enough money saved up in case of an accident to pay our bills for six months.
I recently lost my job. I’m in a better position than some because my old boss gave me a big layoff package and my wife still has a good job. In the email, he also said, “My parents taught me to handle things on my own and not depend on others.”
“I think this is why I’ve been feeling so bad about applying for unemployment benefits.” Do you believe that getting unemployment assistance is ever wrong?
Ramsey quickly went over his strong feelings about Social Security at this point, then gave Brandt’s good question about jobless benefits some background. Ramsey’s first response to Brandt was to be honest about the changes in his family’s life.
His message said, “I like how independent you are.” It looks like you are a good man who works hard, but I don’t know what happened at your last job. It breaks my heart that you and your partner have to deal with this.
Social Security in the United States is a mathematical failure
After keeping a straight face, the famous personal finance expert talked about how worried he was about the current state of Social Security. He said that the U.S. Social Security system is a logical failure. He said, “But that doesn’t mean I won’t take my money when it’s due.”
I’m okay with giving up something I paid for because the government stole it from me in the first place. When Brandt asked Ramsey about jobless benefits, Ramsey changed his mind about what he had said before about taking one benefit from the government.
Ramsey said, “I’m going to give you a warning right now.” When people get benefits for not having a job, they sometimes stop driving. The thought of getting “free” money can make people feel like they can explain staying home and relaxing on the couch instead of looking for work and being more careful with their money.
“But I’m not hearing that kind of mentality from you,” he said again. Once more, it’s clear that you and your spouse have made smart choices about money.
The host of The Ramsey Show finally gave some advice on how people should deal with being unemployed. The author says that retirement packages should be seen as emergency funds and that people should stick to their budgets and stop spending more than they need to.
This means not going out to eat, taking vacations, or spending money on other things until the person is back on solid ground and the problem is fixed.
Ramsey also tells people to make sure they take care of their “Four Walls,” which are food, utilities, housing, and transportation. This means making sure they feed their family, keep the lights on, pay the mortgage, and have enough gas for their car.
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