A germ of an idea for social security and job creation popped into my mind the other day.
If people are gainfully employed, offer them the option to vacate their jobs at 55 years old and take their social security in a lump sum in the amount they have contributed. What they get is ONLY what they have paid in. They would have to agree to not sign up for any future government hand outs.They would have to have a good job history, etc. to be eligible for this option. This is a way out of the social security program for people who have lived life responsibly. It is also a way to open up the jobs they retire from and make the jobs available for younger workers to move up, which will leave lower tier jobs open to new workers. If it is true that people usually collect more money in social security than they paid in, giving it back in one sum would save money in the long run. Possibly make this a temporary, one time offer in conjunction with other permanent reforms to the ss system.
Further, if they start up an enterprise which creates jobs they would not have to pay taxes so long as they were the owner of the enterprise. This would also be a way to begin to walk back social security and seems more equitable than to just keep moving the retirement age upward which is keeping people in jobs longer, jobs which would be openings for new workers.
This may be a horrible idea for many reasons because I am not an economist and my understanding of these issues is not deep. However, this idea popped into my mind the other day and I thought well, it is at least a different approach and throwing it out there might spark a better idea. I realize there is an inherent contradiction in a program that has the purpose of getting rid of a program and I hesitate to put it out there and look like an idiot, so please don’t yell at me. I’m “just say’in.”
This is a common perception that is basically flawed. I did this calculation when I retired two years ago. I worked for 43 years, paying into SS every year. The problem is that people who calculate such things that lead to the statement above forget two things: 1) their employer matched what they paid...an amount that you could have had otherwise, and 2) that sum could have compounded for 43 years. Using the Rule of 72 and a 5% average growth during that time, and assuming that prices increase in the future by an average of 3% and the gov't matches that increase in benefit increases, I must live to 113 to breakeven. Even worse, if I die, the gov't gets the balance. I can't even leave my funds to my heirs. And they call this an entitlement? BS! I earned it.