What Actually Happens When Social Security "Goes Broke"?

DANO WEIR: Let's knock it off okay yeah the episode is starting and i need some information from both of you seriousness Daren how old are you 45 do you know 45 okay you are getting nothing financial confidence for your hip pockets money is really just energy make sure you're checking out at all monies That's what we're talking about this week on It's All Money.

DANO WEIR: They're already laughing. I love it. See, we're trying to make it fun. Who wants to watch an episode on Social Security? You do, because we have information that you may not know. My name is Dan O'Weir.

DANO WEIR: I'm the Marketing Director for Sonoma Wealth Advisors, also a podcast host. This is our conference room off the Sonoma Square, and I'm joined by my co-host, Daren Blonski, CFP, co-founder of the firm, and one of our advisors, Clay Dunkel, CFP, who is also a certified national Social Security advisor.

DANO WEIR: And we are talking about Social Security today, Clay, which is going to go broke. That's the question. That's the thought in everyone's mind. We heard that on a headline on a, oh, it's going to go broke, right? That means it's going to zero. I was shocked to find out from you about a month ago, not necessarily the case.

CLAY DUNKLE CFP®: That's right.

CLAY DUNKLE CFP®: Go broke. I mean, I guess it depends on how you're looking at it, you know, and A lot of people have heard this. It's been on the news for years, right?

DAREN BLONSKI CFP®: Very political on the news, right? Oh, sure. It's a huge political issue.

CLAY DUNKLE CFP®: Like, hey, Social Security is not going to be around for you, right? Like, is that actually the case?

CLAY DUNKLE CFP®: Now, is the program in trouble? Sure.

CLAY DUNKLE CFP®: It's not in good shape, and it's not on a sustainable path right now.

DAREN BLONSKI CFP®: But so is the U. S. Government. Let's just be real here.

DANO WEIR: And you said, p word political and government i want to say something right up front today's episode and our whole everything we do not political not saying whether something should or shouldn't have happened necessarily but trying to look at what is and what you can do around it regardless of which side that you fall on well and the our unique job is literally dancing that line from not being political but knowing that political decisions impact everything we do Correct.

DAREN BLONSKI CFP®: Right. So trying to take a more agnostic approach to things, try not to buy into the propaganda from either side and saying, OK, but how does this impact people's money? How does this impact Dan's day to day life, Daren's day to day life, Clay, normal people in this world versus the people making big decisions somewhere else?

DANO WEIR: Extracting the emotion if you can. So, Clay, if we could, let's just talk a little bit about how Social Security works. It's a program that FDR signed into law in the 40s because it was an issue at the time. People leaving the family farm. You didn't have as many generational families taking care of older people. So here comes this government program to support it. How does it function or how should it function?

CLAY DUNKLE CFP®: I mean, the way that it's funded is through specific tax revenue. So they tax payroll.

CLAY DUNKLE CFP®: Employees pay a percentage of their paycheck into the fund. And then employers match. It's 6.2% for employees, 6.2% match for the employer. If you're self-employed, you're paying both sides of that.

DAREN BLONSKI CFP®: 6.2% of what?

CLAY DUNKLE CFP®: Of gross wages.

DAREN BLONSKI CFP®: Gross wages.

CLAY DUNKLE CFP®: Yeah, gross wages. And there's a cap. They cap that out at, I think for 2025, it's $175,000 is the wage base. But that's... That's... That's basically how it's funded. That's where the majority of the funds are coming from right there. And what's going out the door is benefits, a variety of different benefits. There's retirement benefits. There's disability benefits, surviving spouses, widowers.

CLAY DUNKLE CFP®: Widows and widowers.

CLAY DUNKLE CFP®: It's a pretty… pretty wide ranging program that affects millions of people, a lot of people paying in, lots of people taking benefits. But essentially, the money that's being paid out is funded by the workers that are paying in today. So your folks, my folks, they're taking a Social Security payment, but it's being funded with our paychecks each and every week.

DANO WEIR: So if it's working well, then you have, it almost becomes a measure of GDP because you've got people, it only exists because you've got people working jobs in America that are paying into this thing.

DANO WEIR: And then if it's solvent, right, if it's above the drowning line, if it's above the water, you've got more people paying in than you have than you're taking out to pay people who need it. But the issue at hand and that we've been hearing about is that the people who are taking it are exceeding the people who are the amount that's being paid in. Is that it?

CLAY DUNKLE CFP®: That's right. So through the 80s and 90s.

CLAY DUNKLE CFP®: There was actually a surplus, right? More money coming in than is going out. So that's great. That means that they can accumulate a surplus, put it in this trust fund. They can invest that money, not really investing in traditional securities like a pension would, but they're investing in US treasuries and kind of saving it for a rainy day for the time period when there actually would be a deficit.

CLAY DUNKLE CFP®: So in... I believe it was 2013, maybe 2014. That's when it kind of turned, the table turned, and they didn't have enough from receipts to pay out the benefits. Now, what they were able to do to kind of supplement that deficit was take some of the interest from the trust fund.

CLAY DUNKLE CFP®: Come 2020, 2021, interest wasn't going to cover the deficit. Deficit's getting too big. Now they're diving into the principal. To be able to cover what their obligations are to pay out. That's where the trouble is, right? Now we've got this trust fund. Today, I think it's 2.7 or 2.8 trillion.

CLAY DUNKLE CFP®: It's an astronomical number, but they're saying that that trust fund is going to be depleted by 2033, 2034, that time period. So when that happens, right, there's still the money that's coming in from payroll tax.

CLAY DUNKLE CFP®: There's still everybody's still going to be working paying into Social Security there's just not this backup you know default funding option to tap into now the the amount that workers paying in are going to be able to cover for funds going out is roughly 80 i've seen different number 79 to 82 percent something like that that's sort of where where the estimates are lying.

DAREN BLONSKI CFP®: So, so in theory, for those that say, Oh, Social Security is going away, he's going to be gone. In theory, we could, government can do anything. Part of the reason that politically nothing's being done without Social Security is because it's a political football. It's a hot potato. Like who wants to touch Social Security and deal with reelection, right?

DAREN BLONSKI CFP®: But in theory, so when people say to me, Hey, Social Security is going away. Well, no, I mean, worst case scenario, we'll get 80% of our benefit. Right? As long as there's enough people paying in and people pulling out. So your benefit might, in theory, could get reduced.

DAREN BLONSKI CFP®: What's more likely to happen is the people who vote more often will get less penalized than the people who vote less often, right? And so what do I mean by that? So part of the reason that we consider it entitlement spending Social Security in the United States is because the people who typically vote are the people who are retired and benefiting from it because they have more time.

DAREN BLONSKI CFP®: One. Two, people who are working more active, raising families, their voting records are not great, right? Because they just don't show up to vote. So politicians know that, right? So they're not going to penalize the people who are more likely to vote for the sake of the people that aren't showing up to vote, right? And that's just basic political whatever 101, right?

DAREN BLONSKI CFP®: In theory, because if the trust fund's done, all they would have to do is decrease everybody's benefit across the board, which to your point, Dan, would be a massive hit on GDP. Right? Because think about it. If everybody got a 10% pay cut, it would be absolutely an economic disaster.

CLAY DUNKLE CFP®: You don't think that would be a popular thing to do?

DAREN BLONSKI CFP®: I don't. I don't think that would be a popular thing to do.

DAREN BLONSKI CFP®: So I don't think the politicians have the political will. So what I think is going to happen is until they can't any longer, they're just going to keep kicking the can. No one's really going to fix the issue. It'll work until it doesn't. And then we'll have to really deal with the fallout.

DANO WEIR: But I think the piece that was shocking to me, and I don't know why I never thought it through, but this is what happens, speaking of being a busy working parent and person in society, you don't sit there and go, I'm really going to hunker down and figure out this Social Security thing that's not going to affect me, right? In my head, there's just like an account in the sky.

DANO WEIR: And then when I turn 65, they start sending me money from it. But I heard that it's going to run out. And so when it runs out, then I just think I get zero. And what you're saying is no, at least as the numbers stand at the moment. There's enough to pay me like 80% of what I should get just based on what's coming in and then it coming out directly to me and having no trust account in the middle to make up the difference.

CLAY DUNKLE CFP®: Yeah, that's right.

DANO WEIR: So it doesn't really go broke. It's just less.

CLAY DUNKLE CFP®: And that runs to, I think that runs out to like 2095, they said. So it starts in the 80% range, right? Yeah, we got enough to pay 80% of what we're going to owe. And then I think it drops down to the 70 to 75 range, you know, 80 years from now.

CLAY DUNKLE CFP®: So that's a pretty long runway of being able to cover a substantial portion of the liabilities each year. What does that mean? We can pull up. Can we pull up some of the slides that we have?

CLAY DUNKLE CFP®: There's we went through a few of these numbers. Yeah. Just to give an example, right? The receipts. So they're they're pulling in one point three trillion. This was 2023 numbers. And the expenditures, $1.3 trillion. So the expenditures there are just a little bit over what came in, resulting in a $41 billion deficit.

DAREN BLONSKI CFP®: Well, couldn't we just get some billionaires to fund the deficit?

CLAY DUNKLE CFP®: Start making some calls.

CLAY DUNKLE CFP®: Let's go to the next slide and see what's there.

CLAY DUNKLE CFP®: So 2034, there's that number.

DANO WEIR: Okay, so again, just to clarify, it says Social Security Trust Fund combined to disappear by 2034. That's that in-between account that's supposed to be the surplus.

DAREN BLONSKI CFP®: The slush fund.

DANO WEIR: The slush fund to make sure that if everyone in the world stopped working, there would be money to pay out people. There's Social Security benefits not in the world in America. That's going to be gone, but you'll still be having the current people working paying the people who used to work.

CLAY DUNKLE CFP®: Yeah, that's right. So how do we address the, I mean, 83% is not going to cut it. Right. So how do we address that? There's...

CLAY DUNKLE CFP®: I mean, it's a simple equation, right? Increasing what's coming in the door via tax revenue or decreasing what's going out. I think decreasing what's going out is, like he was saying, pretty unpopular.

CLAY DUNKLE CFP®: Kind of a hot potato. Yeah, for sure.

DAREN BLONSKI CFP®: The people who vote, hey, we're going to cut what you get. That's probably not going to go.

CLAY DUNKLE CFP®: I don't think so.

DANO WEIR: Yeah. But you're, so you're saying you're saying increasing that one. When you look at your pay stub and you see Social Security and that line comes out, that number would be bigger to help make up for this difference. That's right. But another way is that if more people started working or doing more work, right?

CLAY DUNKLE CFP®: Sure.

DANO WEIR: No. Also unpopular.

DAREN BLONSKI CFP®: So I think the other piece to understand about this is if you look at. Generational dynamics, and when you look at the number of baby boomers retiring, is about double what Gen X is, right? The next generation coming through the system.

DAREN BLONSKI CFP®: So in theory, Gen X is reaching its prime working age where they're paying most into the system, but they're only half is what the baby boomers are. So you have to wait for these other generations to catch up with work to then renew the system, right? It's effectively the world's largest pyramid scheme, let's be real. So you have to have more people paying in.

CLAY DUNKLE CFP®: That no hot takes.

DAREN BLONSKI CFP®: We've said no hot takes that's the issue that's what's creating the issue and what's really interesting i'm gonna blow you guys away with this really cool term it's called a socio-technical system this is from my od psychology so a socio-technical system is where when we started controlling birth rates in the United States through birth control and things like that we saw an immediate drop off in the number of people being born in the United States.

DAREN BLONSKI CFP®: Plus, then we've started seeing all these toxins enter our environment, which has really impacted fertility rates, which is more the issue right now. And you hear a lot of people talk about population collapse and that a possibility. If we don't have enough population coming in, then you're not going to have the refunding of these entitlements.

DANO WEIR: That's what I'm saying about the number of people working and the measure of GDP. It literally is like you having a job is not only good for you, But you're literally helping perpetuate this whole other system for all these other people. And if there aren't 10,000, 100,000, a million more of you coming in the door because you're going out the door eventually to the whole thing could that really could collapse.

DAREN BLONSKI CFP®: Right. Well, you're actually we see this coming through now. If you look at the tax proposal, it's now starting to be going from the house and being floated between all politicians.

DANO WEIR: As we record this May 2025.

DAREN BLONSKI CFP®: Correct. So that's going through right now. And part of that tax proposal is to increase the tax credit. So why are the politicians doing that? Because they see the population collapse happening. So they're trying to induce parents to say, hey, I want to be a parent. They're literally paying moms to stay home and have kids because they're so fearful population collapse. Look at China.

DAREN BLONSKI CFP®: Everyone says, oh, China is going to take over the world. Nuh-uh. Go look at their population maps. They're going to collapse in population long before that happens. So All these entitlement systems were set up. They worked as long as there was more people working. But when that changes, it doesn't work. The math doesn't work. And that's what we're facing here. Yeah. The math just doesn't work.

DANO WEIR: It seems super deep, but honestly, when you really start boiling it down, it comes down to those things.

CLAY DUNKLE CFP®: You know what else is interesting about that? The big, beautiful bill is we're talking about income needs to go up or payments need to go down. They're kind of doing the opposite on both sides to Social Security. Right. It's because we got this 2034 number.

CLAY DUNKLE CFP®: This administration is not going to have to deal with it. I think they're just trying to take a win here, but they're trying to say, you know, Hey, let's decrease taxes on the Social Security benefits, which is part of what pays for this. And they're also saying, what are they saying on the income side? Let's see. They got rid of, payroll tax. This may have been.

DAREN BLONSKI CFP®: They're trying to get rid of income tax, right? So they're saying anyone below 160 grand is the current proposal doesn't pay income taxes. That's what the Trump administration's funding.

DAREN BLONSKI CFP®: Right so they're decreasing income taxes are they can also decrease all of the Social Security because you think about who's mostly paying into the system everyone below 160 grand because once you get above a certain level so the tax proposals on the table right now will literally collapse this thing more right but nobody wants to deal with it and that's the point right nobody like i don't want to deal with this political hot potato let's kick the can well they know someone else will have to deal with it and they can take a win making people feel good right now.

DANO WEIR: Or in theory, if they've reduced the amount of taxes, if you got rid of income taxes, would you then spend more, which would then spur the economy? And then that causes more jobs, which would then, I mean, is that to me what they would say? I'm not saying that's necessarily right or wrong. Is that what they would say?

DAREN BLONSKI CFP®: But that might spur lower paying jobs because it's retail jobs, right? It's consumption jobs. It's not going to funnel back into Social Security. So I think they got to figure that piece out. Yeah. Okay. But what politician is like excited? Here comes my reelection. I'm Let me just fix this problem, said nobody. And that's why we're in what we're dealing with.

CLAY DUNKLE CFP®: Let's buckle in and figure this one out. I think what else is interesting and is probably helpful for listeners, as far as expenditures for Social Security, those actually went up because of a change to...

CLAY DUNKLE CFP®: The windfall elimination provision and the government's going to attention offset this went into effect at the beginning it's retroactive to the beginning of 2024 but workers who were covered under Social Security partially for part of their working life and then they've got a benefit from a non-covered pension like you know you have some kind of government pension they potentially got their pension reduced or their Social Security reduced rather because they had the pension same thing for surviving spouse right you're receiving a pension you're not able to get your your your late spouse's Social Security benefit because of the access to the pension those provisions have been eliminated as of the beginning of 2024 so money going out the door is higher than it was in So wait.

DAREN BLONSKI CFP®: Let me just make sure I understood what you said. We just finished telling you we're going to go broke in 2035. Well, in a sense, we're all going to have to take 80% of Social Security. Sure. And the government then just voted to say, yeah, we're going to allow double dipping again. Yep.

DAREN BLONSKI CFP®: Because that's during the Reagan administration, they rolled that back. CalSTRS, which is the teacher's pension system here in California, they couldn't double dip for many years. And now that's all changed. So now they can double dip. And that's not to be offensive to our teachers out there, right? Because we all know they're.

DAREN BLONSKI CFP®: Way overworked and underpaid let's be clear about that but like this double dipping thing really is problematic so for the system for the system this is the politicians are literally playing favor to their electorate bodies and making it even more difficult for us to succeed in the future in.

DANO WEIR: The political hot potato who wants to deal with the problem right right but but do those people deserve it right well who deserves what Right. You can get into those issues and that's what they would argue as they pass that.

DANO WEIR: It does seem a little crazy that as it's, you know, bleeding out the side, we're poking more holes in it. But c'est la vie. So for people who are, you know, thinking about their life moving forward, maybe you're in your 40s or your 50s now.

DANO WEIR: Should you even be factoring Social Security into your financial plan? Should you even be considering, you know, that it's going to have it? Any impact or what should someone do with regards to Social Security who might get it in the next 10 to 15 years?

CLAY DUNKLE CFP®: I mean, I'm planning for it not to be there to be conservative, right? Because you're taking care of yourself. If you're saving for yourself in a retirement plan that the company offers.

CLAY DUNKLE CFP®: You know, in your bank accounts, or you're trying to build, you know, a little portfolio of investment real estate, whatever your retirement plan is, really focus on that, set yourself up, and then whatever Social Security has to offer is going to be, you know, a cherry on top.

CLAY DUNKLE CFP®: That's kind of my view.

DAREN BLONSKI CFP®: The other thing you have to, you go back to, and I always put these things in my sociological brain, right? And what is the purpose of Social Security? And the purpose of Social Security is to effectively keep everyone at minimum poverty level. And if you look at that from a political science standpoint, why keep everyone at poverty level?

DAREN BLONSKI CFP®: That's because in theory, we won't overthrow the kingdom if we're all at poverty level because our bellies are full and we have the basic needs and necessities. So from just a pure sociological political science standpoint, there's no government on earth that's going to say, no Social Security, have fun because they know they're not going to be there anymore. We'll overthrow the kingdom.

DAREN BLONSKI CFP®: So I think it's safe to bet there will always be some component of Social Security. The question is, how much? Is it 80%? Is it 70%? It will always be more opportunistic to lay the taxes into people who don't vote and don't have an opinion, which frankly, unfortunately means that those who don't make a lot of money in this world, the middle class, will continue to get beat up.

DAREN BLONSKI CFP®: And I think that's the reality of the economic situation we're in, right? So to. Clay's point, you have to take care of yourself. You've got to save for retirement, right? 15% bare minimum of what you're earning throughout your working life. You need to be saving for retirement. If you're expecting the government to pay for your retirement, you're on a fast path to broke.

DAREN BLONSKI CFP®: And that's what we do basically, right? That's our job is helping people realize that and then save money to get to that point where they can retire. If you're relying on government, I got news for you. Ain't going to happen.

DANO WEIR: In general, I try not to align my life to need the President of the United States to make a particular decision.

DANO WEIR: You're not going to have much influence there. You're not going to have much influence on Congress. And I'm not saying you absolutely should be involved and vote to the extent that you want to. You should care about these issues. You should do whatever you feel like you want to do to be involved with them.

DANO WEIR: You should also be a realist and take in, you can be a realist, I think you can't say should, take in a survey of what's really going on, what's really out there, and what you can do. You know, they're setting up the maze for you. You can sit there and debate and get angry about the way they set it up, or you can just figure out a way out.

DANO WEIR: Take care of yourself. Come up with your own plan. And say, all right, great, whatever. And that's kind of what you're talking about when you work with clients. I mean, there's, is there a lot of consternation? Is there a lot of, I mean, Social Security even on their radar?

DAREN BLONSKI CFP®: Is that all the time? What are they saying? Well, it's our, am I going to have Social Security? The question we get a lot, correct me if you get a different question, Clay, but the question I always get is, should I start now at 62 or should I take it at seven?

CLAY DUNKLE CFP®: Did I just take it now while there's still something left for me?

DAREN BLONSKI CFP®: Right. Yeah.

CLAY DUNKLE CFP®: That's what they say. Lots of clients.

DANO WEIR: And your answer is? What?

CLAY DUNKLE CFP®: We stick to the program. I mean, I'm not, I'm not of the mind that the benefits are going away anytime soon. They're going to look different here in the next decade. Obviously they got to make some kind of change.

CLAY DUNKLE CFP®: But you know, if you can take it early at 62 versus waiting in until your full retirement age, which is 66 and change or 67 for, for most folks, it's It's a financial decision that really depends on your particular situation. You know, if you need the money at 62 and it makes sense to take the decreased payout to get you that cash flow.

DANO WEIR: Let's be clear on that.

DANO WEIR: They will give you, 65 is full retirement age?

DAREN BLONSKI CFP®: 66 and some months.

DANO WEIR: Okay, 66 and some months. But you can take it early at 62, but it's lower, right? So just fake numbers.

DANO WEIR: Your full retirement age Social Security benefit payment is going to be $3,500 but if you really need it at 62 it'll be $2,800 but you only get $2,800 for the rest of your life right that what you're saying yeah i mean the numbers are different you take a haircut 30 haircut i believe if you if you take it at 62 okay versus your full retirement age yeah and so in that ballpark but that's the question that people have for you and it is it's a fair question.

DANO WEIR: I mean, and so should I take it now and then invest it now? And then what's that going to do in the market? Or, I mean, people, these are the types of things I think that become pseudo math for people when they're looking at doing things themselves or when they're trying to figure this stuff out.

DANO WEIR: And it's something where as an advisor, you know, it can help walk you through some of those scenarios that you're not, you haven't necessarily done before.

DAREN BLONSKI CFP®: So part of the issue is always.

DAREN BLONSKI CFP®: Connected with the question of when should you take your Social Security is also the question we have to ask is how long are you going to live, Dan?

CLAY DUNKLE CFP®: Right.

DAREN BLONSKI CFP®: I don't know. So what I ask clients is tell me about your family. Do you have longevity in your parents and family? Generally, when you do the math, if you're going to live past 83, 84 ish, then it makes sense if you can to wait till 70.

DAREN BLONSKI CFP®: If you're going to die before 83 or 84, you should start taking early.

CLAY DUNKLE CFP®: 70? I thought full retirement age was 60 or 67.

DAREN BLONSKI CFP®: It is, but 70 is when it stops accumulating to your benefit, right? So explain that to us, Clay. So at 66 and some months is what we call FRA, full retirement age. You can start at 62, but why would someone want to take it at 70 and wait until 70?

CLAY DUNKLE CFP®: You get your full payout. Quote unquote full payout at your full retirement age. But each year you wait thereafter, you get an 8% bump, 8% increase.

DAREN BLONSKI CFP®: Which is one way they'll try and fix it, right? Where I think how Social Security Administration is going to try and fix this is politically do things that most people don't understand. So they'll be like, hey, we'll pay you more if you wait till 72 to take it.

DAREN BLONSKI CFP®: Yeah. Right? And they'll play games with when you take it and how you take it to push it. But... If you're going to wait till 70 when it stops growing, then you need to live till 83, 84. That's usually how the math works out.

DANO WEIR: What's amazing is that Darren was Clay's mentor. And so the way that they interact on certain stuff, especially when Darren's like teaching him things, it's like, like, it's like a total.

DAREN BLONSKI CFP®: I wasn't, he knew what I was saying.

DANO WEIR: Why gone Obi-Wan situation. And it's just like, it's just, that's why I just stopped and admired.

DAREN BLONSKI CFP®: I just admired a little bit. Exactly what I was doing.

DANO WEIR: I just, because he's done it before. He's had to learn right at, from the mass funding watch.

DANO WEIR: So they, they're going to give you more if you take it past 65.

DAREN BLONSKI CFP®: Sixty-six and some.

DANO WEIR: Sixty-six and some.

DAREN BLONSKI CFP®: Let's make this really clear for people. You can take it as early as 62, but you're going to take a reduction in benefit at age 62, especially if you're still working. Because the more you're working, they're going to take it down on you further.

DAREN BLONSKI CFP®: At 66 and some days, they're not going to knock you for working anymore. That's your full retirement age.

DAREN BLONSKI CFP®: It will keep accumulating for you until age 70.

DANO WEIR: So that's what I was going to say. So they're going to give you a bigger benefit, but they're doing that because they're basically making more on the bonds that they're buying with it? Like, why would they ever give you...

DAREN BLONSKI CFP®: Because you're delaying benefit, and they're running actuarial tables to figure out you're going to die and not get your benefit.

DANO WEIR: Right. That's what I'm saying. I'm wondering from a...

CLAY DUNKLE CFP®: Yeah, they're keeping more money in the pot.

DANO WEIR: Correct. Correct. So that's why they're willing to give you more is because...

DAREN BLONSKI CFP®: You're able they're able to invest it for longer without you taking it but if you're going to live to 90 then it's totally worth it so if you're looking to really stick it to the government go vegan exercise every day so i'm going to 99 they're getting they're gonna get a bad deal on me yeah right even then it's probably not a not a great deal from all the money you paid in probably your whole life i think the average white male whatever however you look at it is like like 70 and change the life expectancy in the United States now right somewhere out there if i'm not mistaken so then that i mean with that in mind then i mean yeah you should take it as soon as you can right so are you above average yeah right so if you think about if you're going to die at 73 then you start taking but most people don't want to believe that they're dying at 73 yeah they want to believe they're living to 90, 99.

DAREN BLONSKI CFP®: And that becomes the... The problem with giving financial advice, because you sit across and the person say, well, on average, you're going to die at 73. How do you feel about that? That's not an easy conversation.

CLAY DUNKLE CFP®: Yeah.

DAREN BLONSKI CFP®: Right. So that's why I say, if you're going to live to 83, 84, you make that determination. I don't know.

DAREN BLONSKI CFP®: Right. But we've seen the circle of life in this business. And it usually makes sense to start.

CLAY DUNKLE CFP®: Well, most people pull early though. I think, you know, looking at the Social Security website, it was like nine and 10 that are 65.

CLAY DUNKLE CFP®: That are of retirement age are pulling by 65, which is really interesting. Right. I have to validate that number, but it's right in there somewhere.

DAREN BLONSKI CFP®: I mean, that makes sense. But you also have to think that most people we see in these seats are not most people. That's not the average populace, right? So the average populace is quite literally broke, has a lot of debt. They have to pull. They don't have a choice.

DAREN BLONSKI CFP®: That's the average.

DAREN BLONSKI CFP®: People we see tend to have more resources.

CLAY DUNKLE CFP®: They might be shaken out better than everybody else.

DAREN BLONSKI CFP®: Yeah.

DANO WEIR: Clay, before we go, well, what's anything else you want to add that people don't know about Social Security that you were surprised to find out when you got your certification or just, you know, out the door, what people should know about it?

CLAY DUNKLE CFP®: Like we covered a good, a good base of, you know, how the program works, how it's funded. Is it going to be around? Sure. Like, is it in trouble? Yes. But should people really be worried about if they're going to receive a benefit? I don't think so.

CLAY DUNKLE CFP®: You know, I think they make their adjustment in the next decade, end of this decade, beginning of next. It's going to look a little different than it does today. But there's got to be something there. We'll figure out how it goes.

DANO WEIR: The goal of our show, It's All Money, is to give you financial confidence. Not to tell you what to do. Not to say necessarily what's wrong and what's right, but to share what we think are facts. Facts can be disputed sometimes, but what we think are some of the realities of working with money, whether it's your own, whether it's a government program, and then empower you to make your own decision.

DANO WEIR: And we hope that today's episode helped answer the question, what happens when Social Security goes broke?

DANO WEIR: Likely will not. You likely will still get something, we think. So I hope that that brought you a little bit of peace. And if you'd like to learn more about us and how we work with our clients, including helping navigate Social Security, we're Sonoma Wealth Advisors, SonomaWealth. Com.

DANO WEIR: Also in the description of this episode, there is the link for the free wealth analysis. And we'd love to talk to you if you're not already a client, SonomaWealth. Com. And Clay, thanks for being on the show.

CLAY DUNKLE CFP®: Thanks for having me.

SPEAKER 4: This content was produced by Fermata Advisors, LLC, an SEC-registered investment advisor. DBA, Sonoma Wealth Advisors. The opinions expressed by Fermata Advisors, LLC on this show are their own. All statements and opinions expressed are based upon information considered reliable, although it should not be relied upon as such.

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