Confidence in Social Security has been waning in recent years, with roughly 50% of workers aged 30 to 64 worrying about their ability to collect benefits in the future. Now the good news is that despite the rumors, Social Security is by no means on the verge of going broke. The program, as it's currently designed, can't run out of money because it's funded by payroll taxes, which means that as long as we have a workforce, it can continue to run.

But things aren't looking great for Social Security, either. According to the latest Trustees Report, the program's trust funds, which it relies on for income in the event of a shortage, are set to run out in 2034. Once that happens, recipients might see a 21% reduction in their scheduled benefits.

A blurry Social Security card against a cream background


That's a pretty massive hit, especially for those folks who plan to rely on Social Security to provide the bulk of their income. It could also send millions of current beneficiaries straight into poverty -- namely, the 21% of older married couples and 44% of older singles who count on the program to provide 90% of their income or more.

Of course, there's a chance Social Security's trust funds won't run out in 2034. Maybe that'll happen sooner or later. Either way, the best thing current workers can do to protect themselves is to start taking savings matters into their own hands so they're less reliant on those benefits down the line.

Don't bank on Social Security

No matter what happens in 2034, Social Security will provide some income for you in retirement. But even if benefits aren't reduced, they still won't suffice in helping you live comfortably once your paycheck goes away.

Contrary to what you may have been led to believe, Social Security is not designed to be a sole income source. In a best-case scenario -- meaning, no future cuts -- it will replace about 40% of your pre-retirement income if you were an average earner. Most seniors, however, need double that amount to live a decent lifestyle -- one with cable TV, convenient transportation options, and some money left over for leisure activities. Therefore, unless you're really willing to cut corners in retirement, you'll need to bridge the gap between what Social Security will pay you and the amount of income you'll actually need. This especially holds true if benefits are indeed reduced in 15 years' time.

The good news is you have several options that allow you to save for retirement in a tax-advantaged fashion. First, there's the IRA, which anyone with earned income can save in. The current annual contribution limits for IRAs (both traditional and Roth-style accounts) are $6,000 for workers under 50 and $7,000 for those 50 and over. If you have access to a 401(k) through your job, you have an even greater opportunity to save for the future, as the current limits are $19,000 for workers under 50 and $25,000 for the 50-and-over set.

Now if you're not used to saving much, you might struggle to max out either account type, especially a 401(k). But you don't have to max out to establish a solid chunk of savings.

Imagine you're 40 years old and are able to set aside $300 a month between now and age 67 (which, if you were born in 1960 or later, is full retirement age for Social Security purposes). If you invest that money at a 7% average annual return, which is more than doable for a stock-heavy portfolio, you'll accumulate $268,000 for your golden years. Make it $400 a month, and you'll have $357,000 in your nest egg.

While Social Security is not in danger of going away completely, there's a very real chance that benefits will take a dive in 2034. To avoid financial struggles down the line as a result, save as much as you can, for as long as you can. It's a smart move to make even if benefits are somehow spared when those trust funds inevitably run dry.