Social Security: The Evolving Safety Net of Retirement

Social Security has long been the safety net for many Americans approaching retirement. First signed into law in 1935 by President Franklin D. Roosevelt, it quickly emerged as a paragon among government programs thanks to its efficiency, simplicity, and reliability. For decades, Social Security was hailed as one of the best-run government initiatives. However, recent developments have cast a shadow on this legacy. As presidential debates gain momentum, Social Security inevitably surfaces in discussions. A report last year forecasted that by 2034, without changes to the program, retirees might only receive 77% of their full benefits from Social Security. Such a scenario would deeply affect many Americans. An estimated 33% of Social Security beneficiaries rely on Social Security for 90% of their income, and for 65%, Social Security constitutes for half of their income. When you combine this with the possibility of market downturns affecting 401ks (for those who own them) and with savings accounts that lag far behind recent inflation trends, it is obvious that many Americans are dealing with the financial uncertainties of retirement. This isn't a novel challenge. In the 1980s, the Social Security program teetered on the brink of insolvency. The remedy then involved a gradual rise in the retirement age, from 65 to 67, and an uptick in the payroll tax. Although this proved effective for a time, similar problems now resurface. The program faces potential insolvency once more, with proposed solutions like benefit reductions, further retirement age increments, or tax hikes—potentially targeting high earners. The landscape has shifted drastically since the 1980s: declining birth rates, surges in non-traditional employment (which sidestep Social Security contributions), and wage growth trailing inflation. These factors pose newer and more complex challenges. This isn't just an American issue; similar dilemmas arise internationally as well. France, for instance, experienced extensive rioting when their retirement age shifted from 62 to 64. Some protests even escalated to violence. Despite public opposition, the government, fearing a systemic collapse, invoked special constitutional powers to bypass parliament and enforce the change. So, where does that leave the individual? While maintaining savings and retirement accounts remain crucial, stagnant market returns and rising inflation have driven people towards alternative investment avenues. After the 2008 financial crisis, Harvard Business School observed a pivot towards alternative and passive investment strategies. Cryptocurrencies, startup crowdfunding, real estate, and private investments have surged in popularity. Reflecting this trend, Morgan Stanley now advocates for diversifying the traditional 40% bond allocation, suggesting the inclusion of real estate and low-risk hedge fund strategies to offer alternative risk-return prospects. Arbitrage presents two novel solutions to help individuals amplify income from their existing assets. Arbitrage Trade Assist offers a hedge fund-inspired investment strategy democratized for the wider public, minus exorbitant fees or capital lock-ins. By integrating your brokerage account with our API, you gain access to an AI-driven trading platform that streamlines the investment process. Furthermore, we introduce an innovative method to monetize the equity in your home, transforming it into a revenue-generating asset, even as you continue residing there. Dive deeper into these offerings through the links below to embark on the journey to secure your financial future! Arbitrage Trade Assist - Arbitrage HELOC Loan -