Possible Cuts in Social Security Would Affect Small Business Owners
KREX News Room
GRAND JUNCTION, Colo.- With some corporate CEOs pressuring congress to cut Social Security and Medicare to reduce the debt, officials say this could negatively affect small business owners across Colorado.
Many of them are either with little to no retirement plans and say the smallest cuts would cause problems.
“Well the goal obviously would be to retire at the age of 65 or 66, which ever would work out with Social Security and things like that,” said Cheryl Lucas, owner of CRYSTAL Books and Gifts in downtown Grand Junction.
However, Lucas and other small business owners may be in hot water. A 3 percent cut to Social Security and Medicare as part of a way to reduce our national debt could be on the horizon.
“I have a retirement but it is very, very small, when we opened the store, all of the money went into the store so there went all of the money that was saved,” said Lucas.
According to the Washington D.C. based advocacy group “Main Street Alliance,” roughly 36 percent of the state's small-business owners are 55 or older and approaching retirement. This means these cuts will harm any retirement plans they may have in place.
But Financial Advisor Jeff Freeland is all for these cuts if they help to make these plans more viable.
“Making sure that it is going to be here for future generations and for us at the end of our retirement,” said Freeland, advisor at Waddell & Reed. “It might be there in the beginning of the retirement but it could go away at anytime if we don't make it sustainable.”
Freeland says Social Security was never designed as a sole retirement vehicle.
“Hopefully it doesn't affect a person’s overall retirement program because the Social Security piece is just that, its just a piece of that retirement puzzle,” said Freeland.
Though Lucas realizes Social Security isn't her be-all-end-all, for her, it's the little things that add up that could be affected.
“Eventually its going to come down to are you going to have enough money for heat, are you going to have enough money for your mortgage,” said Lucas.
Some are urging that instead of cutting from Social Security, Congress should close tax loopholes and crack down on certain tax abuse that are made on offshore accounts.