"For many retirees today, Social Security serves as a key source of income. And once you retire, it may play a pretty big role in your finances, too. But if you think it's okay to retire on Social Security alone, you're sorely mistaken. A better bet is to have income on top of Social Security to ensure that you're able to live comfortably once your career comes to an end."
"Now, let's talk about Social Security and the amount of money it might pay you. The monthly benefit you get will hinge on your personal earnings history as well as your filing age. But generally speaking, if you earn an average salary, you can expect Social Security to take the place of about 40% of it once you retire. You may not need 100% of your former income to live comfortably as a retiree, but you should expect to need about 70% to 80%."
Social Security provides a key source of income for many retirees but rarely covers all expenses. Some costs often fall in retirement, including housing if the mortgage is paid, reduced transportation from no commuting, and lower household service expenses if retirees perform tasks themselves. Other costs may remain unchanged or rise, particularly healthcare and long-term care. Benefit amounts depend on personal earnings history and filing age. For an average earner, Social Security replaces roughly 40% of pre-retirement income. Retirees commonly need about 70–80% of former income to maintain their standard of living. Annuities or portfolio withdrawals can supplement Social Security to bridge the gap.
Read at 24/7 Wall St.
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