Many Americans look to Social Security benefits to fund most, if not all, of their retirement income needs. The system, however, was designed to provide for minimum income needs only. In order to retire and maintain the standard of living you’re accustomed to, you must supplement your social security income with savings or other retirement income, like a 401 (k) plan.

It’s important to consider how much income you will need when you retire, and how much of it your current Social Security benefits will cover. This will help you set a goal for how much additional you need to save before retirement. There are easy-to-use online financial calculators at www.principal.com that can help you with this.

It’s also important to understand that the future of Social Security isn't completely clear. Changes in the American population over time have begun to put strains on the system; people are living longer and having fewer children. When the program started in 1935, 16 workers were paying into the system for every retiree receiving benefits. Now, only three workers contribute for every benefit recipient. By the year 2020, the ratio will be 2 to 1.

You can still expect to receive Social Security benefits when you retire; however, the payments will probably not increase with inflation. And you will definitely need to rely on additional retirement income. So start planning for your future now. Hair Cuttery offers an excellent way to start saving through our 401 (k) program. This includes a company match on contributed funds—basically free money! For information on how to take advantage of our 401 (k) program, contact a Benefits Administrator through 1-800-TRIMCUT.