The economic downturn has left many retirees with less income and little to spend on basic necessities.
For many, the biggest financial hardship is finding money to pay for basic living expenses.
But as the economy slows, many are now looking for ways to supplement their Social Security benefits.
“It’s a difficult time to be able to take a month off and still have money to spend, so I’ve seen people take advantage of that and start paying off a month’s worth of Social Security, and the other month they’re able to do it again,” said Melissa Toms, a retired schoolteacher in North Carolina.
Toms has been a regular participant in a program called the “Social Security Dividend,” where retirees who earn a minimum of $18,000 a year can receive a 50 per cent refund on the remainder of their retirement checks.
The Social Security Dampens program is also available to people who earn up to $55,000, but only for a period of 12 months.
This is because many workers who receive the program are also receiving a payment of $1,000 per month to help them meet other costs.
“There’s no question the social security income that’s there now is very much tied to the market,” said Robert C. Williams, president of the American Society of Actuaries.
He says it’s important for those with a disability to have a secure retirement plan in place.
Even though there’s no immediate shortage of cash in the economy, Williams says he’s worried the number of people making the transition from Social Security to an IRA could diminish in the coming years.
While it may seem counterintuitive to rely on a 401(k), the benefits are worth the extra cash, Williams said.
If you have a retirement account, you can withdraw your money as you see fit, he said.