re: Social Security - Help me understand better

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It is a tax subtracted from your wages aka INCOME

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Social security isn’t an INCOME tax, it’s a payroll tax.

Why do people like you pretend to know what you’re talking about when it’s clear you have no idea?

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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.

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You have done well and will be pleasantly surprised when you reach retirement age and find that there is indeed some money for you and yours in SS as well as some pretty decent health coverage. And, if you want to see the fruit of your labor today unless your family is incredibly fortunate you probably need look no further than your parents or grandparents who are on SS or, god forbid, some family member who has lost a spouse whose kids are receiving benefits or they were really unfortunate and became disabled....because that is what SS is meant for, the elderly, the disabled and the orphan who can't earn a living wage. It was never meant to be the sole source if retirement income it has always been the basic amount necessary to eke out some kind of a sustenance when earning a living wage is no longer viable....

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So would most productive members of society. The reason SS is going bankrupt is because 49% of the population pays no income taxes. Meaning, they do not contribute to social security. Therefore, SS is a net drain, and by thte time i retire, i doubt i'll even get what i've been putting in.

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Almost no one who is working for a living above board and on the books is not paying into social security. There are some people who are exempt but they are very rare. Social security and income taxes are 2 completely different things. Some folks do not directly pay any income tax (they do however pay federal taxes that are inherent in the price structure of every product and service sold in the US) but almost all working people pay payroll taxes. Productive people are free to control their own destiny as much as they please and are able to....there is nothing preventing anyone from saving for retirement. The VAST majority of Americans support Social Security....somewhere in the neighborhood of 80-90% of Americans support the idea of taking some money out of their earnings every year and handing it directly to the elderly, infirm and orphaned who would be hard pressed to provide much if any of the costs needed to sustain their lives at a modest level. It is always curious to me that folks do not like the idea of social security but will claim to care about the elderly, the disabled and the orphaned.

And Social Security is FAR from bankrupt. It is close, depending on source, to running at a deficit for some period. This happened on the early 80's and the FRA was extended to 67 for most people....because life expectancy had grown by about 15 years since the beginning of SS. Those 2 extra years of work for most Americans has served to keep Social Security solvent for 41 years. Anothe 18 months or so, again with an increase in life expectancy of about 5 years, will keep Social Security solvent for years to come, possibly forever UNLESS life expectancy turns around and starts to go up again. The problem is that 18 months is going to be hard to pass because democrats are gonna claim its a GOP ploy to end SS altogether and the GOP is going to claim that all that needs to be done is turn the turst fund over to the private banking sector and we will all be eating that fee bubble-lub and eating that rainbow stew...without nary an explanation about what the elderly, the disabled or the orphaned is going to do....all the while enriching the banking sector. The American people support the idea of taking some of their money and handing it directly to SS recipients. Our so called leaders however have a different agenda and that is, as always, garnering personal power and enriching themselves and their cronies at our expense. There ain't no party line when it comes to doing that....

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Short version of my response..

The single biggest problem with SS is the dark nasty secret that our government has been borrowing from the funds for so long that there is no chance of it ever being paid back...

This is the single reason there are long term fiscal problems with SS...

but yeah I would rather be in control of my own "retirement" resources...

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This is not true. It is a widely held myth based on the fact that the money is indeed invested, by law, into bonds and the like because it would make zero sense for it to be sitting around losing money with inflation. Those investments may or may not outpace inflation but they do generally keep pace inflation and the adjusted amount of money is about the same. The reason this myth is so prevalent is because some folks have suggested over the years that the trust fund should be invested in equities...and subject to the inherent risk and theoretcical higher rewards. That is all good and well, gambling with money you can afford to lose. The problem is that SS is not that kind of money. It is money Americans willingly give to the elderly, the disabled and the orphaned so they can live modestly with some dignity with the understanding that when the person paying today finds themselves in the same position, which most will someday, they will also have a modest income on which to survive with some dignity. It'd be great for those people to have enough money from playing the markets to sport around in sports cars and eat at swanky restauarants but the markets are volatile...some would benefit, many would go wanting. Its only a modest incomoe....and most Americans are OK with paying for it....

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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.

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I’m Gen X and I’m doing the same as you. What pisses me off is if I had all the money taken out for SS and instead put that money in my 401K, I’d have been able to retire years ago.

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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.

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Chile also has socialized medicine and price caps on prescription drugs. Those 2 items alone are a sizeable chunck of a retiree, a disabled person or an orphan in the United States who has to depend on SS for subsidization of those costs. That 2% would have prevented most of those people from receiving that subsidy.

Chile also has a long and storied history of having social programs in place which would be decried as communism in the United States. Chile is not the best example to bring to the table....because their controlled economy would not be tolerated in the US for a minute and it is that control that keeps the standard of living as high as it is....

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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.

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Again, there is NOTHING keeping anyone from saving for retirement...in fact it is encouraged and advisable. Social Security was never intended to be a private investment account it was meant to be a social contract from one American to another that when they become too old to earn a living, if they should become disabled or orphaned, they would have a modest income to live on with some measure of dignity. 80-90% of Americans like this concept...they are fully on board. Only a small % are so hard hearted that they would eliminate that tiny sliver of human decency from one citizen to another without bankers or even politicians involved to the extent they can be kept the hell out of the loop. Social security has been a SMASHING success in every way imaginable and is one of the few things in the US that is almost universally seen as a net positive....and politicians can not stand to think that there is anything other than them that can bring people together to that extent and, unfortunately, we can depend on their lapdogs on the left and the right to villify the single most succesful piece of legislation ever passed in the United States.

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live to be 300 years old

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Or 350.

its a ponzi scheme.

ps. those illegals you see running across the road at san diego and swimming the Rio Grande will all have 4.8 kids.

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simultaneoulsy toss all doctors and lawyers in jail for about 50 years

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Noooooo!

Well .... lawyers .... okay.


Except for Wednesday.