Millennials catch a lot of flak over what the older generation(s) often view as a disconnect from traditional values. Of course, times are changing—as they say—and some of these “traditional values” may no longer be valid. Still, the concern of what some might consider to be Millennial apathy is also a bit invalid. Millennials actually have extremely valid concerns over how they are supposed to adhere to these traditional values when traditional resources appear to be lacking.
For one—and perhaps the most valid Millennial argument—Social Security does not offer the same benefits as it used to; and Millennials know this, although, they may be mistaken on the details. In a 2014 Pew Research Center survey, an astounding 51 percent believe that the Social Security bankroll is near depletion. While this is mostly inaccurate, though, there is great truth in the fact that we do need Social Security reform.
Indeed, Social Security is not necessarily in any danger of going bankrupt, but the truth is that there may not be quite as many funds available as we would hope. The very same Pew survey which cataloged the misinformed Millennial point of view also demonstrated that 39 percent of millennials believe they will receive a lower benefit [than they should] when they reach the appropriate age. More shocking, though, approximately 94 percent of millennials do not believe that Social Security will pay out benefits that will parallel the benefits currently paid out to today’s seniors.
And it is this latter statistic—which nearly every single Millennial [polled] believes to be true—that is also the most accurate.
To put it simple, Congress is currently looking at repairing Social Security in time to compensate for the budgetary shortfall they expect in 2034. Of course, that is still nearly two decades away so there is a lot of time; unfortunately, Congress cannot seem to agree on what they should do. Obviously, one remedy would be to raise revenue; another way would be to reduce benefits; and yet another fix would be to combine the two in some way.
To be succinct, various surveys of the American public show that the most people vote to cutting or altering payroll taxes on the country’s highest incomes, with 69 percent of the vote. But what most don’t realize is that this would only affect about 10 percent of the people. Other solutions include raising the retirement age, making adjustments to the way Social Security Administration looks at inflation, and using a sliding scale. Unfortunately, there is no easy solution to Social Security and many advisors would actually suggest to millennials (and anyone else looking to improve their retirement outlook) to open a personal Roth IRA or other long-term savings option.