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ThinkSocial Securitywont exist by the time you retire?
But you’ve got the option to bet your bottom dollar that Washington politicians wont let that happen.
The senior lobby grows stronger every year that goes by, asmore baby boomers retire.
And its always ranked among the strongest lobbying groups in the country.
Even if Social Security is underfunded, it would be hugely unpopular for Congress to eliminate it.
However, it pays to ensure you meet the minimum to qualify forSocial Security benefits.
You must earn at least 40 credits to qualify for social security benefits.
you might earn a max of four credits per year.
The Power of Guaranteed Income
No one can predict financial markets movements.
McPeak notes that Social Security benefits offer a rare guarantee of income in retirement.
Often, they end up spending all their funds in savings and IRAs before they die.
Fortunately, Social Security provides for them and their spouses until they die.
In fact, retirement advisors have a name for this risk:sequence of returns risk.
If your spouse predeceases you, you may be eligible to receive a survivors benefit.
Benefits wont disappear entirely, even if you dont get back every penny you paid into the system.
Some workers assume that they wont need Social Security benefits because theyve saved so meticulously for retirement.
But life throws no shortage of curveballs at you, and retirement is no exception.
Ive had clients that have worked all of their lives, had diligently saved and invested.
Sadly, life happens.
Conditions can change quickly when it comes to health.
Even with good benefits and planning, financial shocks can occur.
Other Unexpected Expenses
McPeak explains that the potential unforeseen expenses dont end with medical bills.
Most people look at their account balances and think they wont need all that money in retirement.
However, life happens.
The most common mistake I see is that people underestimate how long they will live.
The second most common mistake is that they did not plan forlong-term care expenses.
Or other expenses could hit that you never expected.
For example, adult children may ask to move back home or ask you for money.
Having that extra source of income from Social Security can relieve the stress of unexpected expenses.
They add a safety net, which you’re able to use to shore up your retirement funds.
McPeak adds that many workers and retirees fail to adequately account for inflation.
Social Security is indexed for inflation, unlike pension or annuity payments, which are usually fixed for life.
Social Security adds one more piece to the puzzle of retirement planning.
And it will inevitably come in handy when life changes unexpectedly in your golden years.
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