For years, the federal government has warned lawmakers that
Of course, there are only two ways to fix the problem: Either reduce future benefits or raise payroll taxes. But how do either of these two actions impact retirement timing, consumption and overall well-being?

A study by the Center of Retirement Research at Boston College looked at
The study showed that benefit-based changes led to reduced consumption in retirement, given the overall shorter length of retirement and the smaller COLA. When payroll taxes were increased, however, the expected consumption didn’t change in retirement.
How should these findings impact that advice that advisors give their clients? Given that there is no impending change to Social Security now, it might be premature to be asking clients to change their behavior.
-
Scroll through to learn about five core changes impacting retirees.
March 19 -
Benefit are usually expected to replace about 40% of their pre-retirement income, but that's an average, so many people will get even less. The question is: how much less?
March 7 -
The normal mantra these days for Social Security strategy is to delay as long as possible. But some clients would be better off filing early, including those who have high debt or those who do not expect to live on their retirement benefits.
March 12
That said, based on this research report, advisors should nevertheless be having conversations with their clients now, to counteract any changes that do come in the future.
10 planning strategies from analysts and experts.
Retired clients: Older clients can breathe a sigh of relief. There has been no talk of retroactively changing benefits for those currently receiving benefits, and any such proposal would be a highly unpopular political move for lawmakers. Instead, the only changes that have been suggested include delaying benefits for future retirees or increasing payroll taxes on current workers. Nervous retired clients should hold onto this knowledge with some hope, and it’s our job to calm them of these fears.
Pre-retiree clients: Clients retiring in the next 10 years should also not expect any dramatic changes to their plans. If revenue or benefit changes are made, they will likely follow suit with previous changes.
Gen X: Workers age 37 to 55 might bear the brunt of any changes, and this is where an advisor’s guidance can offer the most value. To ward off the impact of policy changes, advisors should have discussions with these clients now. Remind them to have a looser grip on their target retirement age, should they be relying on full Social Security benefits as part of their retirement income plan. In addition, advisors should help their clients prepare for the possibility of future payroll tax increases, helping them understand that if they increase their savings rate now, there could be less discomfort in retirement. Saving more and minimizing lifestyle expenses now, can also lead to lower lifestyle expenses in the future and smooth the transition into retirement.
Millennials: