Retire Boom Makes Golden Years Advice a Top 2022 Advisor Theme

In 2022, a growing number of advisors will be focusing on advice on how to best prepare for the golden years. While there is much to learn about the financial and tax implications of retirement, there are also a variety of issues surrounding life insurance and Social Security, which are worth examining.

The Social Security program has a long history. It has been around since 1935. Since the beginning, it has undergone several major changes.

In the early years, the program was financed by low payroll taxes. After the Second World War, the payroll tax was increased. This pushed up the value of benefits for current and future beneficiaries.

In the early years of the program, the benefits were low in absolute value. In the 1950s, the program was transformed into a nearly universal program. The benefits were increased, and the earnings test was revised.

In 1977, Social Security Amendments increased the wage base and raised the payroll tax to 7.65 percent. These amendments also introduced automatic cost-of-living adjustments.

A few years after the initial implementation of the Social Security program, President Bush recognized the need for major reform. He appointed a commission to evaluate the program. They submitted a final report to the President in December 2001.

Despite the recent economic upswing, many adults still haven’t experienced meaningful inflation since the 1980s. This isn’t good news for those looking to retire.

High inflation may erode investors’ purchasing power, making it more difficult for them to achieve their retirement goals. It may also deter established companies from investing in production, leaving them with fewer customers. Those companies that can’t afford to cut costs will have to ramp up production to keep up with demand.

The CPI, or consumer price index, climbed at a record-breaking pace in the last year. It was the fastest in more than three decades. But with the exception of energy, it fell in December.

The December CPI was below the 5.7% average for November but jumped on the annual rate for the first time in more than six months. As it stands, this was the lowest December CPI since October 2021.

The Retire Boom, as it is known, is a major event in the financial planning community. It is estimated that 700,000 baby boomers will reach retirement age in 2022. These retirees will be able to enjoy a lifetime of leisure, but taxation can eat away at that enjoyment.

A number of decisions need to be made ahead of time to keep the IRS from eating up the bulk of your retirement savings. While this may seem daunting, a proactive plan can safeguard your assets for the future.

For instance, tax experts say a long-term bond can be an asset to your portfolio. Generally, a Treasury bond is exempt from taxation at the state and local levels.

Tax-advantaged accounts like annuities and retirement savings plans can be used to implement tax strategies. This is especially true for 401(k) and IRA owners who are in the early stages of retirement.

The Social Security Administration, or SSA, has been a big part of our national security ethos for over 85 years. Not only does it help provide retirement and disability benefits for working Americans, but it also administers social security disability insurance. It is estimated that a large percentage of our population will be eligible for one of these programs at some point in their lives. In other words, a lot of people will be on the hook for Social Security in the years to come.

For decades, the SSA has pushed the envelope with new and innovative ways of providing retirement and disability benefits to their beneficiaries. From the aforementioned COVID-19 pandemic to the latest fad in retirement planning, the SSA has been trying to keep up with the competition.

The next generation of seniors will have a tougher financial future than their predecessors. This is because the Gen X generation is the first to lose many of its retirement benefits. And, because of the rising cost of living, it may have to work longer in order to retire.

A recent study revealed that most Gen Xers are not well prepared for their golden years. One in four respondents said that they don’t know when they will retire. They are also worried about their retirement savings.

Most Gen Xers have less than six months of emergency savings, and nearly half say that a job loss would delay their retirement plans. Gen X is also concerned about the future of Social Security.

Considering that Generation X is the next generation to reach retirement age, it is vital that they prepare for it. If they don’t, they will likely end up poorer than their predecessors.