I hope no one under 50 is depending on Social Security and/or their company's pension plan to meet their financial needs during retirement. Those who are will have a very unpleasant surprise waiting for them in the years to come. Social Security was never intended to be one's sole source of retirement income, and those generous pensions that our parents or grandparents might have depended on are a thing of the past.
Those of us who are under 50 should just think of our Social Security benefits and pension (assuming we even have one) as pocket change for retirement. Unless we intend to spend our golden years at or near the poverty level, our major source of retirement income will have to come from our 401(k) plans, IRAs, and taxable savings. For those of us who have no prospects of inheriting a large sum of money, that's just a sad fact.
All one has to do is look at the numbers. Using myself as an example, my projected monthly Social Security and pension benefits would only equate to about 48% of my current working income. I believe I'm probably in the same boat as the average person of my age. Keep in mind that most people, in order to maintain their current quality of life, need a retirement income equal to about 80% of their inflation-adjusted working income. So the question to ask is this: Could I afford a 52% cut in income when I retire? If the answer is no, then it's time to start saving for retirement. After one retires, it will be too late.
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