"Part of this stems from the fact that there's no need to save for retirement while you're in retirement. But also, some of your largest costs, like housing and transportation, may shrink. Still, you should expect to need about 70% to 80% of your former income to live comfortably once retirement begins. Social Security, however, will only replace about 40% of your former wages if you earn an average salary."
"Now if you're willing to work longer, you could boost your monthly Social Security checks by delaying your claim past full retirement age. But still, you should not expect Social Security to replace your paycheck in its entirety, nor should you assume it'll replace 70% to 80% of what you used to earn. If you've been hearing rumors about Social Security going bankrupt, you should know that they're bogus. Social Security is not in danger of disappearing completely since it's funded primarily by payroll taxes."
Social Security typically replaces about 40% of pre-retirement earnings for workers with average salaries, while retirement income needs often remain around 70% to 80% of prior income. Delaying benefit claims past full retirement age can increase monthly checks but will not fully replace pre-retirement pay. Social Security is funded mainly by payroll taxes and is unlikely to disappear, yet projected funding shortfalls could lead to benefit cuts if lawmakers do not act. Cost-of-living adjustments may not keep pace with rising healthcare expenses, further eroding benefit purchasing power for retirees who rely solely on Social Security.
Read at 24/7 Wall St.
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