Many workers don't save for retirement (or don't save a lot) because they're planning to fall back on Social Security. And while it's not a bad idea to factor those benefits into your retirement plan, your finances should by no means revolve around them. Here's why.

1. Those benefits aren't designed to sustain retirees

Social Security, at its core, is designed to keep seniors out of poverty. It's not, however, designed to pay for retirement by itself. This year, the average recipient collects just over $17,500 a year in benefits -- hardly enough to support a comfortable lifestyle. In fact, Social Security is only designed to replace about 40% of the average worker's preretirement income, but most seniors need close to double that amount to cover their expenses.

Social Security card.


If that figure sounds off, think about the things you spend money on during your working years, like transportation, food, clothing, utilities, and healthcare. Those expenses aren't going away in retirement. If anything, you might spend more in certain categories, like leisure (since you'll have more time on your hands), healthcare (since medical problems tend to creep up as we age), and utilities (since you'll be home more).

And while you might pay off your mortgage in time for retirement, remember that property taxes tend to climb over time, and homes tend to cost more to maintain as they get older. In other words, whatever savings you reap from not having a mortgage payment might be easily offset by the additional housing costs you'll face -- which is why you really do need roughly 80% of your former income once you retire.

2. Social Security might get cut in the future

There are rumors abounding that Social Security is on the verge of bankruptcy, but thankfully, they're false. Since the program is funded by payroll taxes, it can't run out of money as long as we have a workforce. What is happening, however, is that the program is facing a financial shortfall that might cause it to cut benefits as early as 2034. In fact, recipients might see as much as a 21% reduction in monthly payments -- unless, of course, Congress intervenes with a fix, which may or may not happen. The point, therefore, is that while Social Security today might replace 40% of the average earner's preretirement income, it might represent an even smaller percentage in the future.

3. You may be forced to take benefits early

You're eligible to collect your full monthly Social Security benefit once you reach your full retirement age. Depending on your year of birth, that age will be 66, 67, or somewhere in between. You also have the option to file for benefits as early as age 62, but for each month you file ahead of full retirement age, your benefits get reduced in the process.

You might be thinking that you'll just sit tight until full retirement age to avoid an unwanted hit on benefits. In reality, however, you may have no choice but to file for Social Security early.

An estimated 60% of workers are forced into early retirement, according to data from Voya Financial, and the reasons run the gamut from layoffs to health issues that inhibit the ability to work. If that happens to you, and you're forced to claim benefits right away, Social Security will serve as an even smaller income stream during retirement.

Let's be clear: You should expect some income from Social Security in retirement, and there are steps you can take to boost your benefits. But don't use Social Security as a crutch to the point that you neglect your savings. If you don't build some cash reserves of your own for the future, you might really struggle at a time in your life when you're supposed to be enjoying yourself and not worrying where your next dollar will come from.