Most of these boomers have been paying SS tax since they were 16 with their first job. So the majority have paid into the system for over 40 years. What happened to all that money?
I know that is rhetorical.
So let's think about it differently. Inflation works as a multiplier of the malfeasant pyramid scheme.
If you take all 40 years of a Boomers contributions, the amount collected (there is no investment growth) generally does not cover the average payout for more than about 8 years (I think but correction may be in order). A Boomer in 1969 only made about $12,000 per year. A new Firebird only cost $5,000. Gross Social Security payouts per year will eclipse what many made in an entire year when they started paying into it.
Here is the double dip part, the scheme and the reason Social Security is doomed to fail. Not only is the workforce shrinking, and the number of employees paying taxes into Social Security (paying taxes at all) actually going down, but inflation is driving up the real cost of goods and services that are also adjusting what Social Security recipients recieve. Meanwhile, average salaries are still dropping along with the trickle of revenue (compared to what is needed) that is coming in.
There is little hope that social security has a future for the 40 and under crowd. But then again, are any of us still planning to retire before we die?
I am sure this was a rhetorical question and you probably know the answer... it was spent on the Great Society to buy demorat votes with your money, it was spent to prop up other spending programs, it was wasted to create a dependent class of pets for demorat power. Some blame all this largess and waste on the boomers themselves who rose to public office. THAT is a rather flimsy argument since the Boomers began with Clintoon... the die had been cast and the pattern set starting with Roosevelt and polished off by the Greatest Generation in the likes of Kennedy, Nixon, Carter and LBJ (b. 1908). You can thank tricky Dick for inflation when he took us off the gold standard. I hardly remember inflation mentioned before that. You can also thank him for the seeds of the 401 that Ronald Wilson Reagan polished off and gave the money changers a jackpot goldmine to feed of self-directed investor money and make money on both sides of the trade win or lose and then there are all those tasty management fees.
It was never enough to start with though my contributions over the last 40 years would provide the equivalent of about $36,000 a year plus about 3% inflation for a long long time at a constant 6% rate of return... if there were such a thing.
The money is not there though, it is all gone and will never be back. The system is dead, we are just hovering over a corpse waiting on an unwelcome declaration of death. It was spent and squandered and we our boomer generation neither saved enough nor produced enough offspring to make up the difference. Collectively, we are headed for work until death or can’t and the largest population of geriatric indigents the world has ever seen.
80 million boomers will sell to or will what wealth they have acquired to 50 million Gen-X who will be selling to and leading 75 million Gen-Y. Boomers are like a chicken going through a snake. A big bulge steadily being reduced to a pile of crap.
What happened to all that money?
It was taken from those who work for a living and given to those who vote for a living.
“Most of these boomers have been paying SS tax since they were 16 with their first job. So the majority have paid into the system for over 40 years. What happened to all that money?”
It went to the retirees of that time. SS has always been a pass-through system, money doesn’t accumulate anywhere.