According to the Social Security Administration Social Security makes up at least 90% of major sources of income for 34% of the people age 65 or older and is at least 50% of income for another 31%.  That's a lot of people relying pretty heavily on their Social Security benefits!  If we assume these people receive the average benefit amount of $1,051 per month, 34% of the retired population lives on less than $14,000 per year and another 31% lives on somewhere between $14,000 and $25,000 per year. 

By the year 2041, social security trust funds will be exhausted and the amount of collections will only cover 75% of the costs.  That means that by the time anyone that is currently 34 or younger begins receiving benefits there won't be enough money to go around.  Combine this with the national average savings rate at .9% for September 2007 and I expect an even higher percentage of our retired population will be having a hard time making ends meet in the future.

What can you do about it?  One way is to utilize real estate as an investment in your future.  Figure out how you can purchase property now and hold on to it.  Live in it, rent it or vacation in it.  It doesn't matter what you do with it, just hold onto it and let it appreciate.  According to the National Center for Real Estate Research " ...housing remains the primary store of wealth for most Americans."  They go on to say, "Housing is also a leveraged investment so that even small percentage gains in home values can be large relative to the downpayment invested in a home."

Even if you are young and retirement is still 40 years down the road a property purchased now could be sold at any point in the future.  Perhaps it will benefit you when your children are headed off to college and you need a little extra to pay the tuition, or to pay your medical bills in a time of crisis.  If you treat your property as a piggy bank rather than an ATM machine and let your equity accumulate over time you can build a nest egg suitable for whatever your future holds.

If you are interested in more information regarding the benefits of real estate ownership please contact the Mountain Living Team at meredith@mountain-living.com or 888-666-0844.