Scott Galloway reveals blunt instruments about social security, retirement money
While struggling to find successful American workers while also taking care of their financial pensions, they will think of many things—not most importantly, given the role of Social Security benefits, their plans will play in their plans.
Scott Galloway, a professor at NYU and popular Podcaster, has some amazing words about social security. He also has some advice on how to deal with future retirement financial plans and understand how to deal with the funds involved.
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Social Security monthly income is not expected to cover all retirement expenses. In fact, with the latest cost of living adjustment (COLA) triggering these payments in January 2.5%, the recipient’s annual income was just $23,000, just above the poverty line of $21,150.
Related: Scott Galloway warns American workers about social security, retirement flaws
People generally understand that by investing and saving on employer-sponsored 401(k) plans and Individual Retirement Accounts (IRAS), they can increase their hopes for an ideal retirement. But there is more to the retirement preparation equation.
Galloway has put forward some ideas on Social Security and sheds light on other perspectives on how American workers can respond to retirement planning challenges.
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Scott Galloway has strong words about social security and retirement goals
Galloway acknowledges that Social Security faces some financial challenges over the next decade. Its trust fund could shine in 2033 without new laws passed by Congress, according to a recent Social Security Bureau report.
But he has his own ideas on how to fund social security. He explained bluntly that means testing is likely to be the best way to move forward.
More information about Scott Galloway:
- Scott Galloway warns Americans about social security, retirement risks
- Scott Galloway’s Shocking Words About Retirement, Medicare
- Scott Galloway explains social security, retirement flaws
This means that rich people with enough money should still pay taxes instead of recipients of monthly salary.
Galloway calls Social Security Tax a burden for young people. He said that if a person has more than one million dollars in assets, or has a passive income of one hundred thousand dollars, they don’t need that money at all.
Related: Scott Galloway warns Americans about Social Security, retirement risks
Scott Galloway explains how retirement plans should be viewed outside of social security
To gain a good foothold when thinking about financial retirement goals, Galloway recommends working hard to think about how much your money is spent and how it relates to others. He calls it a person’s “burning rate.”
“What is the burn rate you’re eager to maintain?” he asked in the book Wealth Algebra. “It’s easier to answer your age because you’re closer to permanentness. But even if you’re early in your career or still in school, you can get some ideas by building a budget from scratch.”
Galloway proposed a simple way to ask how much it should cost. Asking family about their expenses and researching typical housing and food costs is a starting point.
Regarding retirement plans, Galloway offers a few suggestions.
“You don’t need to project your spending over the next 40 years, until the dollar, nor should it be,” he wrote. “It’s neither possible nor necessary. A rough sketch is a good start; something you can perfect when the goal begins.”
Galloway said the exercise was more than just money. This is also personal.
“With your experience, you’ll get to know yourself better and feel your needs,” he explained. “Everyone’s target burn rate is different.”
“Whether you prefer Pabst or Prada, you can spend a year raising your expected expenses. Increase it by 20% to pay taxes (30% if you wish to live in California, New York or other high tax status). This is your annual burn rate.”
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