Epic Real Estate Investing - NEW Social Security Update Retirees Are In Trouble | 1322

Episode Date: August 1, 2024

Are you approaching retirement, or perhaps feeling a bit anxious about your financial future? Tune into this eye-opening episode where we dissect the critical changes looming over Social Security, especially in light of potential policy shifts if Kamala Harris wins the upcoming election. With over 67 million Americans relying on Social Security, the stakes have never been higher. We'll explore five significant proposals that could reshape the system and drastically impact your retirement benefits—changes that might lead to severe cuts, higher taxes, and even increased national debt. Did you know that four of the five trust funds supporting Social Security could be depleted as soon as 2033? Or that adjustments to the cost-of-living allowances could drain the system even faster? But it's not all doom and gloom! This episode isn’t just about the dangers on the horizon; it’s also about empowerment. We’ll discuss actionable steps you can take now to safeguard your financial future—like starting a part-time business or investing in income-producing real estate. Whether you’re just starting your career or nearing retirement, it's time to take control of your financial destiny. Don't let uncertainty dictate your future. Join us, and discover how to navigate the complexities of Social Security and craft a robust retirement plan that you can trust. Hit play and take the first step towards securing your financial independence! ‌ P.S. Whenever you're ready to go deeper and further with your real estate investing, looking into my partner program to help you get your first deal might be the move... take the first step here for free 👉 Here’s the deal, I’ll partner with you on your first real estate deal, and we’ll split the profits. It’s that simple. Learn more about your ad choices. Visit megaphone.fm/adchoices

This is Terio Media. Hey, strap in. It's time for the epic real estate investing show. We'll be your guides as we navigate the housing market, the landscape of creative financing strategies, and everything you need to swap that office chair for a beach chair. If you're looking for some one-on-one help, meet us at rei-aise.com. Let's go, let's go, let's go, let's go, let's go, let's go.

Let's go. What you see behind me is a recent article from Yahoo Finance, five changes that could be coming to Social Security if Kamala Harris wins the election. So if you're retiring soon, you're going to want to hear this. And if you're a little behind in your retirement savings and you don't know if you will be able to retire, this will be of special interest to you. Because Social Security, it's in grave danger. And here's what you need to know. If these changes go unaddressed, millions could face drastic cuts to their retirement benefits. I mean, imagine a 25% reduction in your standard of living when because of your age, there's little that you can.

can do about it other than going back to work. I mean, that's a legitimate reality that these changes go unchecked. So the first thing, the latest reports show that four of the five trust funds that support Social Security will be able to pay 100% of total scheduled benefits only until 23 before they all start running dry. So if you've retired recently, the clock is ticking on your benefits. If you're nine years away or more from retirement at this pace, there'll be nothing left. With over 67 million Americans currently relying on Social Security, this will plunge millions

into financial hardship. Moreover, the report indicates that the annual cost of Social Security is expected to exceed its income this year, making the situation even more urgent. Second thing, recent policy proposals by Kamala Harris could either stabilize or shake up the system even more. President Joe Biden's sudden decision to drop out of the 2024 presidential race, it put the spotlight squarely on the vice president. I mean, she has largely aligned with Biden on various policy decisions, which is one reason that they are now referring to the administration. as Biden Harris rather than just Biden. So here are the five changes that she's proposing.

One, tax higher income. So the proposal is to tax earned income above $400,000, leaving wages between $168,000 and $400,000 untaxed, which is interesting because it's not mentioned to those earning less than $160,000 a year. But for the most part, taxing higher incomes may feel acceptable to most people. But critics, they argue that this could discourage job creation and investment, potentially slowing economic growth and reducing overall tax. revenue. For retirees, slower economic growth, that can translate into fewer job opportunities

for their children and their grandchildren, potentially increasing their financial dependence on family support. Moreover, higher taxes on employers can lead to reduced wage growth or even job cuts, making it harder for families to save for retirement or support aging parents. Proposal number two, change the COLA formula. This is the cost of living allowance. This calculation, it's there to better reflect senior spending patterns. And this could significantly increase the financial burden on the social security system, accelerating its insolvency without addressing the underlying funding issues. So adjusting the COLA formula to better match senior spending could increase annual social security payouts by about $25 billion that's annually. So over the next decade,

this will add an additional $250 billion to the program's costs. So for retirees, while an immediate increase in benefits might sound beneficial, the long-term consequences will be dire. If the Social Security Trust funds deplete faster, the program could face insolvency, even sooner than the 33 number that I gave you earlier. Number three, raise the PIA, the primary insurance amount for Americans, ages 78 to 82. That's there to help them deal with rising costs later in life. And again, it may sound acceptable to most, but this too would further strain the Social Security trust funds, which could have negative economic consequences, because the proposal of

raising the PIA would cost an additional $200 billion over the next decade. And again, this increased expenditure would either need to be covered by higher payroll taxes or increased government borrowing. Higher payroll taxes would reduce take-home pay for current workers, making it harder for them to save for their own retirement. So if the government chooses to fund the increased benefits through borrowing, this could lead to a higher national debt. And increasing national debt might force the government to implement extreme measures,

which would almost certainly include cuts to other vital programs, such as Medicare or Medicaid or both, directly impacting the health care and financial stability of retirees. Number four, raise the special minimum benefit for lifetime lower wage workers. So the proposal is to increase the, the minimum benefit to 125% of the federal poverty level for individuals. And critics argue that this policy could be difficult to fund and administer and would also create additional financial strain on an already challenged system, just like all the previous

proposals, causing all of the previously mentioned economic consequence. Raising the minimum benefit would cost an additional $150 billion over the next decade. And number five, hike the SSA funding. Kamala wants to increase the Social Security Administration's funding by 9% from the 2003 inactive level. The argument against this, it's the same as all the others. It strains the social security system requiring either higher taxes or borrowing, both of which impact the economy negatively, making it harder for the masses to plan and save for their own retirement. These ideas are all ripped directly from the politicians' playbook, spending more on programs to the detriment of other

programs with no plans to generate the extra money needed other than raising taxes and borrowing money, leaving future generations to pick up the tab. But in this case, Social Security isn't even a half a generation away from going bust. There's not much road left to kick this can down. So what do you do? To safeguard your financial future, you know you can't afford to leave it in the hands of the government. You know you need to take control of it yourself and start planning now. Not only is planning now better than planning later, but a solid plan for a comfortable retirement must incorporate a strategy change as well. And that's by focusing more on compounding assets and income rather than the traditional advice of saving money, compounding interest, and hoping it all out paces

inflation. Hope is a terrible investment strategy. And here's why. If you're in your 40s or 50s, there's simply not enough time left for compounding interest to work as magic. Compounding assets and income, it's your only shot at pulling off retirement that shares any resemblance to your current working lifestyle. So action item number one, consider starting a part-time business. Transitioning from being a sole employee to a business owner, even if it's just part-time, will transform your tax situation overnight. In previous generations, this advice would seem daunting and realistic to most. I get it. But the internet proposes many viable and realistic solutions to this. A small business can create a new stream of income far faster than saving money by counting on the

interest or the dividends that it's going to produce. According to recent statistics, the e-commerce market is projected to grow by 14.7% annually. With the right strategy and effort, your online business could become a significant part of your retirement plan, providing steady income and growth potential far greater than compounding interest that has such a short runway. Action item number two, Investing in income-producing real estate is crucial. I mean, you could kill two birds with one stone actually by doing it because as a real estate investor, you're already classified as a business owner. So there's no need for that internet business if it didn't excite you.

Real estate, it's historically appreciated at an average annual rate of about 3 to 4%. But when you factor in the power of leverage, your returns can easily 10x that. And I know that's a bold statement if you've never heard of this before. But here's how. If you purchase a property with a mortgage, the combination of property appreciation, rental income, and the tax benefits of being a business owner, not to mention the depreciation on the property, plus the amortization, you can boost your overall return without any extraordinary effort by 30 plus percent. Moreover, by educating yourself in creative financing and acquisition

strategies, you won't be throttled by the need for big down payments and strict bank underwriting guidelines. Techniques like seller financing, lease options, and subject to deals can help you acquire properties with little to no money down, making real estate investment accessible even if you don't have much upfront capital. Cashflow savvy just picked up a large portfolio of seller-financed properties. They're out there. For more information on those, download their free investor package at cashflow savvy.com. If you rely solely on Social Security and traditional savings, your golden years will be

at the mercy of politicians making the right decisions. And let's face it, they don't. We've seen time and again how political gridlock and short-term fixes fail to address the long-term solvency of Social Security. So take control of your own financial. destiny, diversify your investments, explore retirement options beyond social security, and incorporate income-producing assets into your plan. Social Security is facing unprecedented challenges, and the stakes are incredibly high.

The clock, it's ticking, and every decision counts. Don't wait for politicians to secure your future. Start building it yourself today. You can't count on the government, but you, you can count on you. And that wraps up the epic show. If you found this episode valuable, who else do you know that might too? There's a really good chance you know someone else who would. And when their name comes to mind, please share it with them.

And ask them to click the subscribe button when they get here and I'll take great care of them. God loves you and so do I. Health, peace, blessings and success to you. I'm Matt Terrio. Living the dream. Yeah, yeah, we got the cash flow. You didn't know, home for us, we got the cash flow. This podcast is a part of the C-suite radio network.

For more top business podcasts, visit c-sweetradio.com. Thank you.