Once in a while we would run across someone who wants to exclude social security from their retirement plan. This, I think, is a big mistake which could cause people to work longer than necessary, or make cuts to their lifestyle they didn't really have to make when they look back on things.
A new trustees report from the Center for Retirement Research just came out. No surprise here, social security is running at a deficit. That deficit is about 2.83 per cent of payroll. As a percentage of gross domestic product, its 9/10 of one per cent. More importantly, the current social security trust fund is fully funded through 2034. After that, the projection for payroll taxes shows that about 75 per cent of the promised benefits will still be able to be paid.
If you're one of those folks that doesn't want to include social security in your retirement planning projections, I think you're making a big mistake, which could cause you to miss out on getting highest return on life during retirement. Instead, if you want to discount social security, I'd suggest crunching the numbers, assuming you'll still collect at least 75 per cent of your promised benefits.