Can Baby Boomers Confidently Retire with Social Security in the US?

1. Can Baby Boomers Confidently Retire with Social Security in the US? Group 6 Rafael Ramos Codeco Paul Yu Catherine Chien

2. SOCIAL SECURITY & MEDICARE • Started in 1935, Social Security Act. • OASDI=OASI+ DI (Old Age, Survivors and Disability Insurance) • HI: Hospital Insurance (Medicare) • Payments to current recipients are funded mainly by taxes levied on current workers. • By 2031 age 65+ are projected to 75 million. • Beneficiary-to-worker ratio will rise from 35/100 in 2012 to 46/100 in 2030.

3. 2014 SOCIAL SECURITY & MEDICARE TRUST FUND REPORTS • Since 2010, cost exceeded its tax income and projected to continue in the long run. • Financial challenges need to be addressed ASAP.

4. BABY BOOM GENERATION • Born in 1945~1964, Post–World War II • 76 million persons • life expectancy has risen gradually (79.86 at 2014) • Expectation of Retirement • Enough money for living/housing • Enough Coverage from Government No. of employees are declining after 2010. • Decline Fertility Rate • Worsen Crisis of Social Security Deficit • Elderly Dependency Ratio is rising.

5. LOOK TO THE BRIGHT SIDE • Government: • Raising the taxable earnings cap/tax rate • Investing part of Social Security funds in equities • Extending Social Security coverage • Raising eligibility age (ex. from 65 to 68) • Retiree: A realistic retirement plan • Reduce living expenses • Choose a post-retirement career • Carefully allocate assets • Improve health condition

6. CONCLUSION • Elderly dependency ratio is rising • declining fertility/life expectancy/baby boomer’s retirement etc. • Financial challenges of Social Security need to be addressed ASAP. • Baby boomers can confidently retire if • Improved financial situation of Social Security • good investment strategy • Set an acceptable/affordable standard of living • Comprehensive retirement plan