Why Social Security Advocates Are Fighting for a Better Way to Calculate Raises
Workers are often warned that retiring on Social Security alone will put them in a very precarious financial situation. And there are several reasons for this.
First, Social Security isn't designed to replace workers' paychecks in full. If anything, those benefits will replace about 40% of the typical pre-retirement paycheck for an average wage earner. For an above-average earner, that percentage will shrink.
Second, Social Security has historically done a poor job of keeping pace with inflation. In fact, it's estimated that since the year 2000, seniors on Social Security have lost a good 30% of their buying power. And it's all because of inadequate cost-of-living adjustments, or COLAs.
Source Fool.com
