{"id":1568,"date":"2026-06-14T13:33:45","date_gmt":"2026-06-14T13:33:45","guid":{"rendered":"https:\/\/charlotterelocationguide.com\/?p=1568"},"modified":"2026-06-14T13:33:45","modified_gmt":"2026-06-14T13:33:45","slug":"fidelity-offers-a-lifeline-to-millions-before-social-security-shifts","status":"publish","type":"post","link":"https:\/\/charlotterelocationguide.com\/?p=1568","title":{"rendered":"Fidelity offers a lifeline to millions before Social Security shifts"},"content":{"rendered":"

Social Security<\/a> helps millions of Americans relying on it pay for retirement<\/a>, and the program is nearing a key funding deadline.<\/p>\n

Read more Goldman Sachs doubles down on Novo stock target after key event<\/a><\/p>\n

Federal trustees confirmed<\/a> this week that the retirement trust fund will run dry about one quarter sooner than their previous estimate.<\/p>\n

The average monthly retirement benefit was about $2,081 in April 2026, and the program provides at least half of the total income for roughly 4 in 10 beneficiaries age 65 and older, according to the Social Security Administration<\/a>.<\/p>\n

That tighter timeline has pushed some older workers toward early claiming, a hasty decision that Fidelity’s planning team says could permanently reduce their lifetime benefits.<\/p>\n

Fidelity’s Financial Solutions Team<\/a> has outlined a strategy framework for every age bracket, from catch-up contributions to Roth conversions, designed to offset potential benefit cuts.<\/p>\n

The 2026 Trustees Report set the Old-Age and Survivors Insurance trust fund’s projected depletion date for late 2032, the SSA confirmed<\/a>.<\/p>\n

That projection moved forward by one quarter from last year’s estimate, which had placed fund exhaustion in the first quarter of 2033.<\/p>\n

The 2025 One Big Beautiful Bill<\/a> Act accelerated that timeline by reducing the trust fund’s revenue from income taxes on benefits, as noted in the Bipartisan Policy Center’s 2026 Trustees Report<\/a> explainer.<\/p>\n

Social Security’s insolvency is no longer the future crisis Washington has been ignoring for decades. This can be avoided with policy changes to benefits, revenues, or a combination<\/p>\n

Without congressional action, the program would cover only 78% of scheduled benefits once OASI reserves run out, amounting to a 22% automatic cut, the Trustees noted. <\/p>\n

The Committee for a Responsible Federal Budget, applying a slightly higher 24% cut<\/a> to current state-level benefit data, estimated that the average retiree would lose about $500 per month.<\/p>\n

Beneficiaries in 29 states would face reductions exceeding that national average, and the automatic cuts would affect a total of 63 million people.<\/p>\n

Congress has historically reached compromises to continue funding the program, and past reforms have been phased in over the years rather than imposed abruptly, Fidelity noted.<\/p>\n

Current recipients would likely face the least impact from future changes in solvency, Brad Koval, a director at Fidelity’s Financial Solutions Team<\/a>, noted.<\/p>\n

“Historically, changes made to the Social Security program to improve its solvency have impacted younger workers,” Koval said.<\/p>\n

More Fidelity:<\/strong><\/p>\n

But the uncertainty has pushed some older workers toward early claiming, a move Fidelity<\/a> vice president Can Lu says could backfire significantly.<\/p>\n

“People in older generations may think Social Security is going away, so they claim right now, which isn’t good since there’s a huge benefit to delaying,” Lu said.<\/p>\n

Your monthly benefit grows by roughly 8% for each year you delay past full retirement age, up to age 70. Full retirement age is 67 for anyone born after 1960.<\/p>\n

Read more Wedbush analysts predict potential Xbox Project Helix shortage in 2027<\/a><\/p>\n

Claiming at 62 instead of 67 permanently cuts your monthly check by 30%, a gap that compounds over decades, the Social Security Administration<\/a> confirmed.<\/p>\n

The Center for Retirement Research’s 2025 analysis<\/a> found that the share of people claiming Social Security at age 62 has fallen sharply since the mid-1990s, dropping from more than half of eligible workers to roughly one-quarter of new claimants today.<\/p>\n

Maskot\/Getty Images<\/a><\/p>\n

Workers in their 50s have access to enhanced contribution limits that could help offset a potential reduction in Social Security income.<\/p>\n

“Certainly by age 55 you should be thinking about it, and the earlier the better,” Lu said.<\/p>\n

Lu noted that catch-up contributions, combined with employer matching and the compounding effect of invested savings, can meaningfully close a future income gap over time.<\/p>\n

In 2026, workers aged 50 and older can add an extra $8,000 catch-up to their workplace plan, bringing total allowable 401(k)<\/a> contributions to $32,500, the Internal Revenue Service<\/a> stated.<\/p>\n

Workers between ages 60 and 63 qualify for a larger super catch-up of $11,250, raising their maximum annual workplace contribution to $35,750, Fidelity noted<\/a>.<\/p>\n

One complication affects higher earners this year: those with Federal Insurance Contributions Act taxable wages above $150,000 must direct catch-up contributions into a Roth 401(k).<\/p>\n

If your employer does not offer a Roth option within its retirement plan, you cannot make catch-up contributions at all in 2026, Fidelity warned.<\/p>\n

Converting traditional retirement savings<\/a> to a Roth individual retirement account<\/a> is another tool Fidelity highlights for workers concerned about future tax exposure and benefit reductions.<\/p>\n

You pay income taxes on the converted amount upfront, but qualified withdrawals in retirement are tax-free, and Roth accounts are exempt from required minimum distributions.<\/p>\n

One important rule applies: the Roth individual retirement account must meet a five-year aging requirement before earnings withdrawals can be taken without taxes or penalties.<\/p>\n

Younger workers hold a different kind of advantage: decades of compounding that reward even small, consistent increases in their annual savings rate, Lu noted.<\/p>\n

The program has never missed a payment in more than 90 years. Congress has always acted before benefits were cut during prior funding crises.<\/p>\n

With only six years left on the clock, individual preparation remains the one variable every worker and retiree can begin controlling today, the Fidelity report<\/a> noted.<\/p>\n

Related: Social Security’s funds will run out sooner than expected<\/a><\/strong><\/p>\n

The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.<\/i><\/p>\n

Read more Fixing Money 101: NC\u2019s Plan to End Financial Fragility<\/a><\/p>\n

This story was originally published June 14, 2026 at 9:17 AM.<\/span><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

Social Security helps millions of Americans relying on it pay for retirement, and the program is nearing a key funding deadline.<\/p>\n","protected":false},"author":1,"featured_media":1567,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-1568","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-read-todays-edition"],"yoast_head":"\nFidelity offers a lifeline to millions before Social Security shifts - \u0421harlotte Relocation Guide<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/charlotterelocationguide.com\/?p=1568\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Fidelity offers a lifeline to millions before Social Security shifts - 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