(VitalNews.org) – A new survey shows most Americans do not trust Social Security to be there for their retirement, and this caution is reflected in their investment choices.
The recently released Allianz Life survey found 74% of respondents believed they could not trust Social Security benefits to actually materialize when they need them for retirement. An even greater number–88%–said they needed an additional stable source of income to live comfortably when they retire.
There is reason to worry. A recent annual report by the U.S. Treasury says Social Security recipients might see their benefits slashed by 20% around the year 2034. An earlier Treasury survey pegged the key year at 2035, but slow economic growth in the U.S. caused a revision. Social Security trust funds are down $22 billion according to the latest numbers.
Allianz’s Kelly Lavigne said that while Social Security is the mainstay of many people’s retirement plans, “it cannot be your entire strategy.” Lavigne recommends finding additional stable sources of income, such as an annuity, to “cover essential expenses.”
Another tip for those coming up on retirement: get a lower-interest-rate personal loan to pay off high-interest debt such as credit cards and other forms of revolving credit. Homeowners may do this with a lower-interest-rate home equity loan.
The survey also found that those nearing retirement age are skittish about investing in the market, and a large majority worry that inflation will make their current lifestyle unaffordable. 78% of respondents voiced this concern, up from 68% in the survey from one year ago.
When it comes to investment behavior, 63% of those surveyed kept more of their money out of the investment market than they would normally. Almost the same number said they were holding on to their assets in cash out of fear of extreme market fluctuations.
In 2022, inflation hit a remarkable 9.1 %, higher than it has been since the early 1980s.
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