RSS Facebook Twitter LinkedIn

Featured Advisor

Asset Preservation Advisors


State: GA

APA’s philosophy is to work closely with our clients to develop an in-depth understanding of their unique needs and objectives. We then customize a municipal bond portfolio that best meets their specific goals and needs. APA manages high quality municipal bond portfolios in four strategies: Short-Term, Intermediate-Term, High Income, and Taxable.

Click to see the full profile

Share |

How Would Younger and Older Investors Fix Social Security?

Most investors agree that future generations can look forward to smaller Social Security payments, but solutions to the problem vary by age.

| BY Adriana Reyneri

While the vast majority of younger and older investors lack faith in the Social Security system, the two age groups tend to advocate different proposals to keep the program solvent, according to the latest monthly survey from Spectrem’s Millionaire Corner.

Attitidues toward Social Security also vary among men vs. women. Click here to learn more about the gender divide.

Few investors – especially the youngest ones - believe that Social Security as we know it today will be around for future generations, according to our May survey. Roughly one-in-five older investors have confidence in the system, but the share drops to 11 percent among investors ages 40 and younger.

How do self-described knowledgeable investors learn about the workings of Social Security benefits? Click here to find out.

Age also appears to influence investors’ perceptions of the best way to fix the system. Here’s a closer look at ways younger and older investors – many of whom are already receiving Social Security benefits - would address the projected Social Security shortfall:

·         I don’t know: Younger investors, who represent generations X and Y, are most likely to admit they don’t have a solution to the problem. One-third indicated “I don’t know” what tactic would best shore up Social Security. Older investors are more likely to have an opinion on the subject. Only 15 percent indicated they didn’t have an answer.

·         Increase Social Security taxes: Older investors are most likely to see increased employee contributions as a solution. Forty-five percent indicate the best fix would be to “require workers to pay into the system according to their full salary, not the current cap.” One-fourth of younger investors support this strategy.

·         Limit benefits: Younger investors are three times more likely than older investors to advocate a limit on benefits. Thirteen percent support disallowing benefits for seniors with more than $75,000 in retirement. Only 4 percent of older investors like this idea.

·         Make 401(k) contributions mandatory: Fifteen percent of older investors like the idea of requiring workers to contribute part of their salaries to a 401(k) or other type of retirement plan. The share drops to 10 percent among younger investors.

·         Chained CPI: A proposal to link Social Security cost-of-living adjustments to the Chained Consumer Price Index to slow the rate of COLA increases is equally unpopular among older and younger investors. Only 6 percent of younger, and 8 percent of older investors support the idea.