Do you pay into Social Security? Do you expect to receive Social Security in your retirement. This is a must read article from seekingalpha.com.
Bloomberg interviewed Alicia Munnell from the Boston College Center for Retirement Research. She of course has come to be a thought leader for what ails the Social Security system. Shockingly, it boils down to three things: cutting benefits, raising the cap one way or another or some combo of both. I’ve framed it numerous times by saying that something will have to give.
Included in there is what I will bluntly call nonsense about replacement rates as in how much of someone’s income Social Security is intended to replace. There was talk in the interview about replacement rate dropping from 36% to 27% over some long period of time.