According To The Social Security Administration Board of Trustees, Social Security Cuts On Horizon

According to the newest report from the Social Security Administration Board of Trustees, the Social Security program is set to run aground as early as 2034. This is when the supply of U.S. Treasury bonds in the Social Security system runs out, and the program will either have to find new additional sources of funding, or fund benefits out of incoming payroll taxes.

The problem: Projected payroll tax collections won't be enough to pay forecast benefits. Unless the system is fundamentally changed, either there will have to be significant benefit cuts, a major increase in payroll taxes or some other tax to fund the program, or some combination of both.

Absent an intervention, Social Security beneficiaries may face cuts as high as 21%.

The problem will likely not affect seniors currently in retirement. But, today's workers should be aware that future benefits may be much lower than they currently assume, and plan accordingly.

What you can do.
The best thing to do is live on less than you make - and save and invest enough to make up Social Security's shortfall for yourself and your family.

For example:

Max your 401k match. 
If your employer's 401k plan offers a matching contribution, make sure you take it. It's free money and offers a much better return on investment than your otherwise likely to get, at much less risk.

Fund the maximum IRA you can qualify for.
The current limit for both Roth and traditional IRA is $6000 and $7,000 those aged 50 and older. Some income limits apply, but even if you make too much money to contribute to a Roth or to take a tax deduction for traditional IRA contributions, you can still contribute to a traditional IRA on a non-deductible basis. You won't get a current deduction, but you'll still get tax-deferred growth and no current taxes on capital gains and dividends.

Go back and max out your allowable 401k. 
As of 2019, you can potentially contribute up to $19,000 per year in your 401k, over and above your employer's matching contribution. If you're over 50, you can contribute $25,000. Your account will grow tax-deferred. You just pay income taxes as you take the money out in retirement. If you are covered by a 403(b), speak with your Human Resources department about ensuring you are maximizing your contributions.

Consider annuities. 
These are Insurance products, but are specifically designed to provide retirement income, as well as tax advantages on growth, similar to non-deductible IRAs. These may be good options for those who have maximized their contributions to IRAs and work workplace retirement plans.

The sooner you begin saving aggressively, in both taxable and tax advantage accounts, the more likely it is you'll be able to take any anticipated reduction and Social Security benefits in stride, when the time comes.

Should you purchase an annuity? it should be carefully tailored to your financial situation, needs, and objectives. If you believe an annuity is right for you, working with a financial professional can help with your evaluation process and maximize your retirement planning success.

To connect directly with an independent financial professional, and to request a personal strategy session to discuss your needs and goals.  Contact Jennifer Lang at WFGInsuranceQuotes.com

For more helpful financial tips, follow her podcast, Independent Wealth Planner Strategies with Jennifer Lang.