Once and For All, Social Security is Alive!
It’s always interesting when someone writes an article that fully captures something that you are already thinking, have been communicating and discoursing about for years but never thought to write down. This article in 401k Specialist entitled Knock it Off, did just that. John Sullivan, the author, seeks to dispel the common and popular myth that Social Security will not be there for us because it will be bankrupt! This is a notion that grabs headlines, gets people riled up and is often used as the primary reason to get people to save their own money in retirement plans. The article used the appropriate phrase, forget these “Chicken Little predictions,” this is one of the few government programs that is universally popular!
Not only is it a popular program, but it is one that is funded by the American worker and their employer to be one of the primary sources of post-employment funding. Frankly, without it, the level of elderly poverty in America would skyrocket. The U.S. government knows this as do the politicians, so there is more than sufficient motivation to ensure that this program persists. To once again paraphrase Mark Twain in a blog (see Think more Like Kurt Cobain, not Mark Twain), “the reports of Social Security’s death are greatly exaggerated.”
Social Security will be there for us, perhaps in a different form or amount, but there. The real question for the retirement plan community is how to use it with pre-retirees in the accumulation and planning phases of their life. At Unified Trust, we’ve been incorporating Social Security into our Managed Account program, the UnifiedPlan® since we launched it nearly a decade ago. Ultimately, to determine whether a participant is on track to achieve a successful financial outcome, we believe you need to look at all pieces of the puzzle and consider a spectrum of different sources; personal savings, passive income, post-retirement employment, social security and of course, the retirement plan. This is highly valuable information that few people seek out on their own until they’re actually close to retiring. Yet, without this information front and center, a large piece of the retirement income puzzle is absent.The UnifiedPlan takes all of this into account. It considers the various sources of retirement income, provides the participant a goal defined in monthly dollars and then automates the investing process. Participants are defaulted into a portfolio and a glide path that gives them the highest probability of achieving a successful retirement outcome. The defaulting mechanism overcomes procrastination and other detrimental behaviors so that the plan automates success as the default. That’s premium value for the participant and their employer and ultimately, for the advisor to provide to their clients.
For more information on Unified Trust, our services or on the UnifiedPlan please contact Advisor Services at firstname.lastname@example.org.
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