There are so many people who put off thinking about saving for retirement believing they will “catch up later”. It doesn’t seem so urgent when it’s decades away. And it always feels like there is time to do something about it, until there isn’t.

Social Security was designed to help prevent poverty for people who are of retirement age. It’s a mandatory tax taken right out of your paycheck and is based on a percentage of your income. But it’s not going to help you as much as you might think.

Find out where you stand

You can find out for yourself where you stand on this if you go to the Social Security website. You’ll need to set up an account to see your numbers. Once you’re logged in, you’ll be able to see what your expected earnings will be based on when you are eligible to receive payments.

If you have trouble setting up an account, you can also get a rough estimate by using the Estimated Social Security Benefit Calculator, without having to log in.

Eligibility will range between age 62, which is the earliest you can receive payments, and age 70, which is when the amount of your payments would be at max benefit. These numbers are going to be based on the income you have reported to the IRS over the years and assume that your current income will continue to be consistent.

If you don’t have a high income, your benefit amount is not going to be a lot. If you have a median income, it won’t be much better. Take a look for yourself. The following chart is based on someone born in 1981, who makes about $40,000 per year. The chart shows the benefit amount depending on the age this person began receiving benefits. (Note: once you start receiving benefits, they do not go up as you get older. Wherever you start is the number you stay at.)

Retirement Age	Monthly Benefit
62	$1,158
67	$1,689
70	$2,122

Is it enough?

This is not a lot of monthly income. And it’s actually going to be less because Social security income is also taxable. If this is your retirement plan, you will likely be barely squeaking by and relying on public assistance programs to supplement, if you’re eligible, that is.

A lot of people will find themselves in a situation where they make just a little too much for any kind of public assistance and not enough to be able to afford anything other than bare minimum necessities. Doesn’t sound like a comfortable retirement, does it?

Most people think of the word “retirement” and imagine a life of leisure, taking regular vacations, doing all the things they didn’t have time to do in their working years, a life of luxury, etc. But if you haven’t planned and saved throughout your working years, your retirement is not going to look like this at all.

Social security can be a nice supplement to your retirement but it should not be your main source of income. You are allowed to work while drawing social security, but if you start receiving it before the “full benefit” age (67 in the example above), the amount you receive will be reduced based on your income from other sources at the time.

Once you hit full benefit age, it doesn’t matter how much you make in other income. Your benefit amount will not be reduced. But are you going to want to continue working? Maybe, but if you do, it should be a choice, not a necessity.

Start dreaming

Financial freedom is about having choices. What kind of choices do you want available to you? Living on Social Security benefits alone is not going to give you a lot of choices in your golden years.

The best time to do something about it was when you first started working. The next best time to do something about it is now. Start thinking about what you want your life to look like when you’re in your 60’s and 70’s, and for the rest of it.

Dream it up and write down your vision for your future. Having a vision will make you start thinking about ways you can make it happen. Keep coming back because the next few posts are going to be about saving and investing for this vision of your future.