How Social Security privatization could change the role of IRAs in your portfolio
Although the idea has been around for decades, it's taken on new heat as some worry DOGE cuts to the Social Security Administration (SSA) are the first steps in forcing privatization.
There's no denying that saving for retirement as we know it would change if Social Security were ever privatized. Also impacted would be the value we put on other methods of savings, like individual retirement accounts (IRAs). Here's how some of those changes might present themselves.
IRAs could become even more important
There's nothing like the knowledge that your Social Security benefits aren't going to be as much as expected to inspire you to find another way to build retirement savings. Chances are, IRAs will become even more critical as a primary vehicle for saving, helping you bridge the gap between income needs and resources.
Some may make IRAs their primary retirement funding source, as IRAs tend to provide more investment options than 401(k)s and other employer-sponsored retirement plans.
Contributions could be increased
If lawmakers do ever decide the current Social Security system needs an overhaul, there's a good chance they'll at least discuss increasing IRA contribution limits as a way for individual investors to bolster their retirement funds. While they're at it, Congress could consider enhancing catch-up options for older workers.
You'd have access to a more diverse investment strategy
IRAs offer such a wide range of investment options, you may base your investment decisions on what works best in tandem with other investment types, like a 401(k) and annuities. It's easier to come up with a balanced portfolio when you spread assets across several investment types. For example, if you have an employer-sponsored retirement plan that's heavy on higher-growth assets like stocks or real estate, you may want to balance those with a bond-heavy IRA.
The point is, no matter how your specific investment strategy works, IRAs give you one more tool to work with.
You might become a bit of an IRA whiz
Even if you've been investing for years, don't be surprised if taking greater control of investment decisions leads to a higher level of financial literacy and a deeper knowledge of how to make the most of an IRA. As you take on more responsibility for retirement savings, there's likely to be a heightened focus on financial education, investment options, and how to make the most of strategic withdrawals.
In addition, it's possible your employer will get on board by providing you with easier access to financial advisors and resources – a move sure to add to your knowledge base.
Long-term growth would take on greater importance
For the casual investor (particularly a new investor), the focus is often on short-term gains. However, knowing that your Social Security benefits will be less than expected may be enough to turn your focus to long-term growth instead. In turn, depending on your age, you may find that you have a larger appetite for taking risks with IRA investments to make up for any shortfalls in Social Security.
As mentioned, it's also possible that an IRA will be your "safe space" — a place to invest in lower-risk assets. No matter how you use it, it's likely that it will be with an eye on the future.
You could decide to integrate annuities
With the knowledge that you're making up for lost Social Security benefits, you could decide to integrate annuities into your IRA. Annuities can be a good way to create steady, predictable income that complements other retirement investments.
In short, if Social Security privatization ever comes to pass, it's a good bet that IRAs will become an even more important part of the average investor's portfolio.
The Motley Fool has a disclosure policy.
The Motley Fool is a USA TODAY content partner offering financial news, analysis and commentary designed to help people take control of their financial lives. Its content is produced independently of USA TODAY.
The $23,760 Social Security bonus most retirees completely overlook
Offer from the Motley Fool: If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known "Social Security secrets"could help ensure a boost in your retirement income.
One easy trick could pay you as much as $23,760 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. JoinStock Advisorto learn more about these strategies.
View the "Social Security secrets" »
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Boston Globe
an hour ago
- Boston Globe
More Americans support path to citizenship for undocumented immigrants with no criminal background, UMass poll finds
But a strong majority, 69 percent, support deporting undocumented immigrants who have criminal records, according to the release. This is down from an Advertisement 'These results suggest that the Trump administration, if it desires to be in step with the public that they represent, should emphasize the detention and removal of undocumented immigrants with criminal records,' Tatishe Nteta, provost professor of political science at UMASS and the poll's director, said in the release. The Trump Administration has vowed to deport 11 million undocumented immigrants, and has authorized aggressive enforcement tactics, such as raiding schools, churches and other venues that have long been safe havens for immigrants. The poll also found that only 30 percent supported deporting undocumented immigrants who work full time and pay taxes. Around 37 percent of poll respondents supported deporting undocumented immigrants who had no criminal record outside of their immigration status and 33 percent of respondents supported deporting those whose children were born in the U.S. Advertisement The poll found that Americans support protections for legal immigrants as well. A majority of respondents said that immigrants on valid visas should be entitled to constitutional rights that citizens enjoy like freedom of speech. A minority of respondents thought legal immigrants, like international students involved in protests, should be deported for expressing opposition to American foreign policy. The poll also found bipartisan opposition to reducing federal spending on scientific research at universities and requiring colleges to consider ideological diversity in hiring and admissions, according to the release. The poll of 1000 national respondents was conducted by the website YouGov between July 25 and July 30 and the margin of error for the poll was 3.5 percent. A little over 50 percent of respondents oppose immigration enforcement in churches, schools and hospitals but public opinion is split when it comes to enforcement elsewhere. For example, around 43 percent of respondents supported immigration enforcement at home and 40 percent at workplaces, according to the results. There was a big partisan gap on the question of where immigration enforcement was acceptable with 65 percent of Republicans supporting immigration enforcement at churches and hospitals while support for enforcement at these venues among Democrats was in the single digits. Around 70 percent of poll respondents said that immigrants in the country on valid visas should be entitled to the constitutional rights that citizens have such as freedom of speech, the right to an attorney when accused of a crime and the right to a hearing before a judge before deportation, among others. Advertisement Around 22 percent of respondents opposed deporting legal immigrants on the basis of their opposition to American foreign policy, an objective the Trump administration has been pursuing when it comes to international students like Tufts University PhD candidate, Rümeysa Öztürk who expressed opposition to the war in Gaza. Support for these deportations was higher among Republicans, conservatives and Trump voters, but did not exceed 50 percent in those groups. Angela Mathew can be reached at
New York Post
3 hours ago
- New York Post
Miranda Devine: Biden abused his authority by turning FEMA into a far-left political machine
The Biden administration abused its power by turning the entire mechanism of the federal government into a Democrat voter mobilization campaign, according to newly unearthed White House documents viewed exclusively by The Post. The worst offender was FEMA, the Federal Emergency Management Agency, under the Department of Homeland Security, which was controlled for four years by Biden's Machiavellian border buster Alejandro Mayorkas. When responding to an emergency or a natural disaster, FEMA employees were directed to make voter registration a 'key priority.' They politically targeted vulnerable people in their hour of need instead of focusing on providing federal assistance. Left-wing NGOs were brought in to 'educate' FEMA staff about 'equity and voter access for individuals affected by disaster,' says a Trump administration official. 'FEMA's job is to make sure Americans who have suffered catastrophic loss due to some disaster in their community [can access] food, water and shelter . . . Under President Biden, FEMA, like every agency, produced a plan on how they would leverage these crisis situations for political [purposes]. I can't think of anything more disgusting.' FEMA snubbed GOP FEMA employees were so fixated on voter outreach that, when they visited hurricane-ravaged Florida last October, they didn't even bother knocking on the doors of houses that had Trump signs in the yard. Instead of assisting Hurricane Milton survivors, they were instructed to 'avoid homes advertising Trump,' according to an Office of Special Counsel complaint. FEMA supervisor Marn'i Washington was fired as a scapegoat after Republican Florida Gov. Ron DeSantis called foul on the scam and The Daily Wire reported that at least 20 homes with Trump signs or flags had been skipped by FEMA and denied the opportunity of qualifying for federal assistance. It stands to reason that if FEMA's priority was getting out Democrats to vote, the last people they would want to visit were Trump supporters. The Florida scandal came on the heels of the Biden administration's sluggish response to Hurricane Helene in Trump-supporting rural areas of North Carolina and Tennessee. Whether it was Hurricane Helene, the Maui wildfires, Hurricane Ian, or the East Palestine train derailment, FEMA always came up short during the Biden years. The agency's inadequate performance is more understandable when you realize that providing actual disaster relief to victims had become simply a side dish to the partisan political priorities of the Democratic Party. Every week, Post columnist Miranda Devine sits down for exclusive and candid conversations with the most influential disruptors in Washington. Subscribe here! It began the minute Joe Biden came into office, when he concocted a fake voter registration crisis by leveraging the same racial discord that he had exploited during the George Floyd riots the previous summer, claiming that 'many Americans, especially people of color, confront significant obstacles to exercising the fundamental right' to vote, including 'difficulties with voter registration, lack of election information, and barriers to access at polling places.' This was not true. In fact, voter turnout in the 2020 election of 67% was the highest recorded in the 21st century, according to the Census Bureau. Voter registration, likewise, was at a record high in 2020. 'Equity' and 'access' were euphemisms for policies designed simply to increase Democrat voter turnout by targeting demographics that traditionally vote Democrat. Biden launched his federal government-wide voter recruitment program with an Executive Order on March 7, 2021, to 'promote equity in voter access.' The date was chosen deliberately to fall on the 56th anniversary of Bloody Sunday to invoke the civil rights legacy of fighting voter suppression against black Americans. Biden announced the scheme at a breakfast in Selma, Ala., absurdly tying the Jan. 6 Capitol riot to what he claimed was a renewed struggle for voting rights. Fed turnout machine A federal lawsuit filed by nine states last August claimed that his order was drafted by progressive racial activist group Demos, which 'monitors implementation and advocates that federal agencies do more.' The EO was executed by Susan Rice, Biden's assistant to the president for domestic policy, whose primary focus was making 'equity' central to every arm of government. In 2021, she commanded all federal agencies to dream up ways to re-engineer their activities to prioritize voter turnout, especially in 'marginalized communities.' The Department of Energy, for example, targeted low-income households that qualify for federal weatherization assistance with voter registration paraphernalia before the 2022 midterm elections. The Department of Labor enlisted state workforce agencies to designate American Job Centers as voter registration agencies and coordinating exclusively with leftist 'voting rights' groups. The Department of Health and Human Services instructed federal health centers to engage in voter turnout, including 'encouraging patients to register to vote, assisting patients with completing registration forms, sending completed forms to the election authorities.' HHS also encouraged voter registration by ineligible illegal aliens who had access to health coverage through the Affordable Care Act, according to an expose by Heritage Foundation Senior Legal Fellow Hans von Spakovsky. DHS went above and beyond. A FEMA 'Strategic Plan for the Implementation of Executive Order 14019, Promoting Access to Voting' dated Sept. 10, 2021, and sent to Rice by Katherine Culliton-González, DHS officer for civil rights and civil liberties, summarized what DHS was doing to comply with Biden's EO by using disasters and emergencies to harvest voters: 'DHS has planned and begun implementing a variety of internal and external activities to promote access to voting.' The plan included 'key messaging and . . . resources to promote equity in voter access through their training preparedness initiatives for individuals impacted by a disaster or emergency event.' Also included were novel ways of harnessing 'internal resources, and points of public interface to promote equity in voter access before, during, and after a disaster or emergency event.' Registration drive Another arm of Mayorkas' empire, the Citizenship and Immigration Services (USCIS), was enlisted for the turnout effort, with a plan to 'build up its existing efforts to facilitate voter registration for new citizens at the end of naturalization ceremonies, in coordination with governmental and nongovernmental organizations.' At 2,100 naturalization ceremonies for new Americans, DHS embedded 'voter-registration outreach,' inserting 2 million voter registration forms in 'welcome packets' and inviting only partisan left-leaning groups. Another White House document covering 'Partnerships and Outreach' showed that DHS signed 'Memorandums of Understanding' with the League of Women Voters in October 2022 and NALEO Educational Fund in February 2023, for naturalization 'ceremony support.' Another DHS outfit, the Cybersecurity and Infrastructure Security Agency, co-hosted 'Your Vote Your Voice 'cyber-hygiene webinars' with another NGO, the Chicago-based Center for Tech and Civic Life (CTCL). Taxpayer resources allocated by DHS for voter turnout in 2022-2024 included 12 full-time USCIS employees, $1.9 million in print contracts, and 'costs absorbed' for a dedicated five-person team from FEMA's Individual and Community Preparedness Division. President Trump issued a new executive order in March this year to reverse Biden's subterfuge, calling on every federal agency to ensure the voter outreach schemes are dismantled. The cost of this Sovietization of the federal government is incalculable. But let's hope FEMA and the other agencies can get back to their day jobs.
New York Post
3 hours ago
- New York Post
US Attorney Jeanine Pirro backs Trump's DC takeover threat and demand for lower prosecution age limit: ‘Stop coddling!'
US Attorney Jeanine Pirro said in an interview Wednesday that she supports President Trump's threat to federalize Washington, DC, if local officials don't crack down on youth crime – arguing that juvenile delinquents are 'coddled' in cities run by Democrats. Pirro, the top prosecutor in the nation's capital, fumed that she's not allowed to charge minors accused of violent crimes and backed Trump's push to lower the age of legal accountability to as young as 14, in an interview with Fox News host Laura Ingraham. 3 Pirro noted that youth crime is on the rise in DC and fumed that she is unable to prosecute most minor offenders. AP 'I support him totally,' Pirro said of Trump's warning Tuesday that he would bring the District of Columbia under federal control if laws aren't changed to prosecute minors as adults. 'If that's what we need to do to get it done, that's what he should do. And I support the president.' 'He's the only one coming here saying, 'I want to make [DC] safe and beautiful.' I haven't heard anyone say that besides him,' Pirro added. During her appearance on 'The Ingraham Angle,' the former Fox News host and New York district attorney noted that she spoke to Trump on Tuesday – when he issued the takeover threat – and explained the situation in DC. 'I said, if you're 14, 15, 16, or 17-years-old, you get coddled, as you do in most American Democrat cities, so I can't charge these people,' Pirro explained. The US attorney went on to describe the early Sunday morning assault of former DOGE employee Edward Coristine, who was beaten up by as many as 10 assailants during an attempted carjacking just a mile from the White House, and how her hands are tied in that situation as well. 'This young kid who worked at the White House was beaten to a pulp … by a gang of punks,' Pirro said of the attack on the 19-year-old tech whiz nicknamed 'Big Balls.' 3 Trump threatened to federalize Washington, DC, Tuesday after a former DOGE employee was beaten up by teenagers during a carjacking attempt in the nation's capital. Truth Social/@realDonaldTrump 3 Pirro said she supports Trump's call for DC officials to crack down on juvenile crime. AFP via Getty Images Two of Coristine's alleged attackers – a 15-year-old boy and 15-year-old girl, both from Maryland – have been arrested by DC police. 'None of them come to my office because they're not considered criminals,' Pirro railed. 'They go to family court, where the effort is rehabilitation.' 'The DC Council – and the president is right – they've got to stop their coddling,' the top prosecutor demanded. 'We've got to lower the age of responsibility to 14.' 'If you think that these kids need to be coddled and they need to be hugged – they need to have consequences. They need to understand that enough is enough,' Pirro continued. 'If you tell me I can't prosecute a 17-year-old for carjacking, then you don't know what you're talking about, because the truth is that if you don't give me that power, and you want to send them to some arts and craft program, then you're out of your mind.'
