- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
re: Social Security - Help me understand better
Posted on 2/8/23 at 11:13 am to FMtTXtiger
Posted on 2/8/23 at 11:13 am to FMtTXtiger
quote:
For those who are very educated in this. how do you get more SS payout than you put in? Im not trying to do it, trying to understand why its so messed up without a simple "the govt controls it thats why".
Reading the rules, Im trying to understand why the program can't be better or terminated/transferred into other things now that roth and 401k programs are so mature without effecting certain people.
If more people are retiring, shouldn't more people have already contributed? Is it all due to inflation? Who comes out ahead with so many falling short of what they put in? The hot young wife that never worked who collects on her dead husband?
BTW, not a fan of it, would rather control my own destiny. Appreciate the dialog.
So you'd best be controlling your own destiny anyway...there is nothing stopping you from doing so. Most people have some additional retirement savings although very few have adequate retirement savings.
The basis for Social Security has always been, and is today, exactly what it says in the name...a basic level of social security in the form of income to those who can not earn a living wage....the elderly, the disabled, the widowed and the orphaned. Roths and 401Ks do not provide for those people unless they are someone else was fortunate to pay into one of them long enough and with enough money to provide for them when that person is no longer around. If you live long enough and are fortunate you will get more out than you put in. Most people do so in a couple of years. Some do so in one check. Some never do but most do in a couple of years. Currently on average a person who retires at 70 will break even at age 80 and a few months. Many never make that. The life expectancy of ALL people born in any given year is around 78 or so right now. Folks are free to save as much or as little for their retirement as they can afford....but orphans, many disabled, widowed and old people can't or did so in siffucient amounts to pay their nut and those people will either pay their nut themselves, we will pay it for them, they will die or they will commit a crime to survive....SS ain't perfect but is better than any alternative anyone has ever dremaed up because it provides for those who never had an opportunity to do so for themselves....
2
Posted on 2/8/23 at 11:50 am to Tantal
quote:
It's a Ponzi scheme. The money that the boomers put in has already been spent. They're now using Gen X's money to pay the boomers. Then they'll use millenial/Gen-Z money to pay Gen-X, etc.
The reason it is not a Ponzi scheme is because what you describe above ie boomers and xers a zers is how social security has been sold since its inception. For it to be a Ponzi scheme the person promoting it would lie and say the money that was being paid out came from returns on investments. Social security has never been promoted that way....
Posted on 2/8/23 at 11:56 am to FMtTXtiger
Posted on 2/8/23 at 11:58 am to Grooler
quote:
The amount that you pay into it goes directly to the current beneficiaries (i.e., retirees). This works well as long as you have stable age demographics, which we do not. Because of an aging of the population, the share of retirees is growing relative to the share of people paying into it, making the program unsustainable under current tax rates ($ inflows) and benefits ($ outflows).
Also SSI disability abuse, which has really spiked in the past few decades.
Posted on 2/8/23 at 12:01 pm to FMtTXtiger
Also, disability payments are part of the Social Security program. This has expanded massively over the past 20 years and is now commonly seen as a type of “welfare replacement”. Anyone know how this has affected the long term solvency of the program?
Posted on 2/8/23 at 12:01 pm to AwgustaDawg
George W Bush made a proposal to allow 2% of Social Security contributions to be invested in the stock market.He was excoriated for suggesting that and he dropped the idea quickly.
His inspiration was the Chilean form of social security.It’s a compulsory private pension plan where workers have 10% of their salaries withheld and their money is invested in the Chilean stock market.
It’s done great things for their economy and raised them from poverty into a prosperous nation with a fairly high standard of living.
That’s not the only factor.Chile has a stable government after many decades of various dictators,coups and so forth.
His inspiration was the Chilean form of social security.It’s a compulsory private pension plan where workers have 10% of their salaries withheld and their money is invested in the Chilean stock market.
It’s done great things for their economy and raised them from poverty into a prosperous nation with a fairly high standard of living.
That’s not the only factor.Chile has a stable government after many decades of various dictators,coups and so forth.
Posted on 2/8/23 at 12:02 pm to FMtTXtiger
And they get automatic COLA too
They got a 8-9% raise on their payments as well
Must be nice
They got a 8-9% raise on their payments as well
Must be nice
Posted on 2/8/23 at 12:05 pm to FMtTXtiger
quote:
Reading the rules, Im trying to understand why the program can't be better or terminated/transferred into other things now that roth and 401k programs are so mature without effecting certain people.
This was the only thing Republicans ever floated changing about SS. They were simply for giving people the option to opt out and have those funds diverted into their own type of investment.
On cue, the Democrats started the "They're going to take your SS away"
Democrats are, and will always be, big government. Making that change takes power and control from Congress and the US Government. Something they will never stand for. Democrats love Big Brother telling them what they need.
Posted on 2/8/23 at 12:14 pm to FMtTXtiger
Years ago, the federal government "borrowed" millions of dollars from the Social Security fund and essentially wrote an "IOU" to pay it back, which they still haven't done. Social Security was solvent when that happened and the future was secure until they "borrowed" those funds. There are dozens of now eligible programs that disperse checks from current Social Security funds, such as disability, adopted children, and illegal aliens. The Democrat's and Republican's bill passed last summer also raided nearly $300 billion from Medicare to boost insurance companies by removing leverage from negotiations on drug prices. A lot of folks die before collecting a single dollar from Social Security. What happens to that money? You know what happens to it. We all do.
Posted on 2/8/23 at 12:14 pm to FMtTXtiger
quote:Think about that question for a moment.
For those who are very educated in this. how do you get more SS payout than you put in?
If you invest $1000 in an account at 5% interest, 50yrs later it totals ~$60,000.
How do you get more payout ($60,000) than you put in ($1000)?
For individuals retiring this year, and assuming they live 25yrs (90y/o), their SS payout will be roughly 3/4ths what a US Treasury account held over the same period would total.
If one dies at 80y/o, SS payout would be roughly 1/2 the value of a personal US Treasury account.
If one dies prior to any SS payout, the value would obviously be 0% that of a US Treasury account (which could be passed on as inheritance).
In general SS ROI <3%. Inflation has averaged ~3.8%.
Posted on 2/8/23 at 12:16 pm to kingbob
quote:
When social security was created, the retirement age was equal to the average adult life expectancy. Thus, those who survived past it were a relatively small percentage of the population.
This isn't the argument you want to make, the life expectancy for adults wasn't light years away from what it is today - infant and child mortality weighs heavily on overall life expectancy and it was much higher back then.
quote:
There were 12 working individuals for every one beneficiary.
Today... the ratio of workers to beneficiaries is closer to 3 workers for every 2 beneficiaries. The system is unsustainable and collapsing in on itself.
This is the correct argument. Especially when you consider beneficiaries are receiving benefit amounts calculated including their peak earning years and those paying into SS are well below that stage of income generation.
Posted on 2/8/23 at 12:27 pm to FMtTXtiger
quote:It could be. It won't be though.
Reading the rules, Im trying to understand why the program can't be better or terminated/transferred into other things now that roth and 401k programs are so mature without effecting certain people.
You are thinking of SS as a retirement benefit.
In reality, SS is a government funding mechanism. Employed Americans and their employers are forced to lend the Government money over the course of the worker's career. When the worker retires, the Government returns the borrowed money in monthly aliquots and at a terrible ROI.
Posted on 2/8/23 at 12:28 pm to FMtTXtiger
quote:
Reading the rules, Im trying to understand why the program can't be better or terminated/transferred into other things now that roth and 401k programs are so mature without effecting certain people.
Maybe you are too young but GWBush tried to get legislation to allow current workers to invest some of their SS contributions into higher yielding investments. The dems would not allow any changes in SS and accused Rs of "risking the retirements" of seniors in the "risky" stock market. The whole plan died.
Now I can't remember how it was to work in that the inflow into SS just turns around and outflows to retirees as it works now. There never has been a Trust Fund and any overages above needed liabilities in the past were just absorbed into the general fund and spent.
As a retiree, I'm glad I stuffed so much money into the stock market. I'll bet on American business every day.
Posted on 2/8/23 at 12:28 pm to Joeybd
quote:
The imbeciles here who don't understand, want to be deliberately ignorant.
SS taxes are separate from income taxes, everyone pays everyone is eligible for payments.
You're an idiot.
https://www.ssa.gov/news/press/factsheets/HowAreSocialSecurity.htm
Posted on 2/8/23 at 12:30 pm to FMtTXtiger
Its a Ponzi scheme, theyre illegal for a reason.
Posted on 2/8/23 at 12:30 pm to AwgustaDawg
quote:
many disabled
Man, it's a good thing nobody has figured out a way to game that system, because that would be bad.
Posted on 2/8/23 at 12:36 pm to SWCBonfire
quote:
This isn't the argument you want to make, the life expectancy for adults wasn't light years away from what it is today - infant and child mortality weighs heavily on overall life expectancy and it was much higher back then.
Which is why the retirement age needs to be pushed back a few years, but people go nuts even at that.
Posted on 2/8/23 at 1:09 pm to El Segundo Guy
quote:
I'm Gen X and am not counting on a single penny from SS. I've planned and budgeted accordingly. I hate to think of it as a sunk cost, but I've come to look at it that way.
I'm 60 and expect to collect on it as soon as I decide to stop work after 62. While I agree something has to be done, it can't be done for people within 20 years of retirment.
YTD, me (and my employer) have contributed $258,502 on my behalf. Ignoring the time value of money (which you cannot), if I retired at 62, I would be paid out in just short of 84 months (8 years) at 70 y/o.
Posted on 2/8/23 at 1:14 pm to AUauditor
quote:Correct.
Ignoring the time value of money (which you cannot).
But ignoring the time value of money is the only way anyone can claim you'd be "paid out" at 70y/o
Posted on 2/8/23 at 1:20 pm to BugAC
quote:
The reason SS is going bankrupt is because 49% of the population pays no income taxes. Meaning, they do not contribute to social security.
I understand what you’re trying to say, but you’re just flat out wrong here.
If someone has a W-2 job, they’re paying into social security (unless they’re covered by a government pension). That person might not have to pay income tax because their salary is less than the standard deduction, but they’re still paying payroll taxes along with their employer.
Page 2 of 8
Popular
Back to top
Follow TigerDroppings for LSU Football News