![\"Christine](\"https:\/\/cst.brightspotcdn.com\/dims4\/default\/752253b\/2147483647\/strip\/true\/crop\/2400x3596+0+0\/resize\/840x1259!\/quality\/90\/?url=https%3A%2F%2Fchorus-production-cst-web.s3.us-east-1.amazonaws.com%2Fbrightspot%2F5d%2F5e%2F8d4e3d134378a0f565db76a05fa5%2Fchristine-benz-2018.jpg\")
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Christine Benz, director of personal finance and retirement planning for Morningstar, is also the author of \u201cHow to Retire: 20 Lessons for a Happy, Successful and Wealthy Retirement.\u201d<\/p>\n
But there are a few things Congress could do with the program that would affect younger people, or high-earners who are receiving Social Security.<\/p>\n
One would be lifting the age at which a person could claim benefits. Full retirement age was 65 until Congress in 1983 started gradually increasing it to 67, where it is now. <\/p>\n
You can currently receive Social Security benefits between age 62 and 70. You\u2019re entitled to full benefits when you reach your full retirement age,<\/a> and the longer you wait to apply, the higher the benefit, according to the Social Security Administration.<\/p>\n Benz said the Social Security tax cap could also be raised even more. The cap is the maximum amount of annual income that\u2019s subject to a Social Security tax, with the remaining earnings not taxed. It changes each year, and the cap for 2025 is $176,100. <\/p>\n \u201cIf Congress lifted that cap, it would help address the [funding] problem,\u201d she said.<\/p>\n Benz also said Congress could implement a type of \u201cneeds test,\u201d which could curtail benefits for wealthy older adults.<\/p>\n Save more, invest more<\/p>\n Younger adults should prepare for the possibility of fewer benefits by saving more and investing into retirement accounts such as a Roth IRA, according to Benz. <\/p>\n \u201cMost people do not have pensions any longer. So most of us will be coming into retirement with Social Security and whatever our retirement savings are,\u201d she said. \u201cI always say 10% is a good starting target for people who are just getting their savings plans off the ground. But for higher income workers, or people who have the wherewithal to save more \u2014 15%, or even 20%, is a good target.\u201d<\/p>\n Also, take advantage of company retirement accounts like a 401(k). Benz says for younger adults like Kylie, a Roth IRA can be a nice option because the taxes are paid up front so when it\u2019s time to retire the funds can be withdrawn tax free. <\/p>\n \u201cRoth IRA also gives you a lot of flexibility if you\u2019re just getting your plan off the ground because you can withdraw your contributions at any time and for any reason without any taxes or penalties. So that\u2019s kind of a nice escape hatch if you realize you can\u2019t leave the money … there until retirement,\u201d she said.<\/p>\n It\u2019s also important to think about what you\u2019re investing in. Benz said she likes broad market index funds or exchange traded funds. A nice \u201cone and done\u201d investment is a global version of a total stock market index, which will \u201cgive you little bits of exposure to all the companies throughout the world,\u201d she said.<\/p>\n A target-date fund is another investment to consider.<\/p>\n \u201cThat is an investment that is going to kind of manage itself until you get to retirement,\u201d Benz said. \u201cIt starts off very aggressive for young people, with mainly stocks in the portfolio, and then very gradually takes risk out of the equation. So by the time you hit retirement, it might be 60% stocks and the rest has gone into safer assets like bonds. For people who just want a single investment for life, that\u2019s a really good way to go.\u201d<\/p>\n Have a financial question you want answered by an expert? Leave us a voicemail at 312-321-2122<\/a> or email us at moneyquestions@suntimes.com<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"We\u2019re gathering your questions about all things money and finances. Each week, we get your questions answered by…\n","protected":false},"author":2,"featured_media":107344,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[64,63,99,186,184,185],"class_list":{"0":"post-107343","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-au","9":"tag-australia","10":"tag-business","11":"tag-finance","12":"tag-personal-finance","13":"tag-personalfinance"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/107343","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=107343"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/107343\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/107344"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=107343"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=107343"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=107343"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}