The Annuity News Journal’s Christi Roberts says that “Variable Annuities Could Save Social Security.” I think there is a valid argument for this point, but can’t imagine how long of a road it would be to get the government on board. Social Security has been in place since 1935 and changing the system would be difficult to say the least. But the system has become flawed as more money continues to stream out than go in. Something has to be done to correct the demise of Social Security so that our kids and their kids will receive their money in retirement. Maybe switching the system to variable annuities will actually be the way to go.
One advantage of variable annuities is that they grow tax-deferred until a date later in the future when you need money. They also offer stability with monthly income payments and protection in a down market. If you are lucky enough to possess a variable annuity during a market increase, your benefits will skyrocket. If the Social Security system started using variable annuities, growing their income tax-deferred would at the very least push the problem of running out of money farther into the future. Best case scenario, which many people believe is a possibility, restructuring Social Security in this way could correct the problems it faces today.
Written by Rachel Summit
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