Social Security has been in our country since 1935, and for some, a resource that has been counted upon at retirement. Currently there is consideration being given to reducing the amount of Social Security that is paid out. Congress is evaluating the use of a means test to do so. No one knows if means testing will become a reality, but the discussions that are taking place warrant further exploration and understanding.
A means test is simply a process of looking at income, and based on certain criteria, determines if social security is needed. For example, one plan being considered would reduce Social Security by $1,000 per month, for every $1,000 of income that is non-Social Security income received over $55,000.
The idea of the means test was originally based upon some language found in the 2015 US budget proposal. The proposal was aimed toward reducing the aggressive Social Security claims, occurring when some are claiming benefits.
A means test could have the greatest impact on those in the middle class. Hardworking individuals, professionals, and small business owners could be hurt significantly by this proposed evaluation.
The facts are, we do not know if and when means testing will actually be enacted. The best solution however, is to plan now. Start saving and protecting your investments for the future. Morris Hall can help with that process. We're happy to discuss this with you and advise as to the best processes and procedures and a way to hold your investments, as well as how to invest them.
Contributed by Morris Hall PLLC Phoenix Estate Planning Attorney and Senior Partner Dan R. Morris.
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This blog should be used for informational purposes only. It does not create an attorney-client relationship with any reader and should not be construed as legal advice. If you need legal advice, please contact an attorney in your community who can assess the specifics of your situation.