” Will Social Security Run Out Of Money?”

Just south of ‘Sawmill Creek…..
Hi Attorney Kevin Pritchett here
     Before I answer the question of

“Will Social Security Run Out?

I have to explain how Social Security is funded and hence how you are taxed for it.

How Much  Social Security Tax Will You Pay?   
Social Security taxes are paid on amount of all wages earned.  In 2018 the maximum income for social security tax is $128,400 and the maximum tax on that amount is 6.2%.  So if someone earned the maximum of $128,400 they would pay $7960.

Medicare Tax
    There is an additional 1.45% tax to fund Medicare.  This tax is uncapped so no matter what your earned income you pay this 1.45%.

     If you earn over $200,000 you pay an additional 9% for single filers and heads of households and that 9% is assessed on earned income over $125,000 for married filers filing separately and over $250,000 for married couples filing jointly.

Employers Social Security and Medicare Contributions
    In addition to the part employees pay Employers pay 12.4% of employees salary for Social Security and  2.9% for Medicare.

Self Employed Contributions
   Self employeds who earn $128,4400, or more
would have to pay the whole $15,921.60.

However, these self employeds can deduct half of the
Social Security taxes paid to reduce their
adjusted gross income. 

Projected Social Security Trust Fund Shortfall
     Here’s the issue regarding your retirement planning…according to Social Security Administration due to rising costs and diminished revenues, by 2034 there will be projected shortfall in the Social Trust Fund. 

     As a result either benefits will be reduced ortaxes will be increased…neither situation is good news.

Take Home Message On Social Security 
DON’T RELY ON SOCIAL SECURITY ALONE FOR YOUR RETIREMENT NEEDS!!!!

    You need to plan your savings so that you receive GUARANTEED, LIFETIME INCOME  no matter what SOCIAL SECURITY OR STOCK MARKET DOES!!!

     Don’t believe me……just talk to any number of your friends who are still working past 65 because they lost money in the 2008 recession!!!

    There are things you can do to protect your retirement income…

Reach Out To Me If You Have Questions. 
If you have comments or questions about any of this…send me an email :ironkop@gmailcom
or if reading on my blog or Facebook page leave your questions or comments below.

Remember…..”Things Don’t Get Better With Neglect…..”

Kevin Pritchett, Esq
Law Office of Kevin Pritchett, Inc.  
ironkop@gmail.com
www.KevinPLaw.com
312-505-1957