Posted on 10/19/2016 11:09:59 AM PDT by MaxistheBest
“Most people on SS get paid far more over the span of their retired lives than they EVER put into it.”
Think again. My brother died at age 58. He paid into SS from age 16 until he died and never got a penny. My husband died at age 64. He paid into SS from age 16 until he died and never got a penny. I also paid into SS from the age of 16, and I do not feel guilty getting a SS payment every month. I will never receive as much as my brother, husband and I combined paid into the system.
I'm afraid your comment sounds just a bit elitist in tone.
We've already heard from people that depend on SS and SSI for a crucial supplement to their pensions--thru no fault of their own.
Lumping these people in with welfare grifters and other SS scammers is going to be seen as an insult on the face of it.
Is this pittance of an SS increase a sign of a responible government acting honestly in fulfillment of a good faith financial contract?
An excellent comment upthread puts it very clearly: " Bullshit!
If I had the money that was contributed in my name, I could have over $2,000,000 in principle built up at this point."
If we allow Big Government to weasel out on a contemptible SS increase like this and save a ton of capital on the backs of seniors, then we can't complain if the same Big Government continues to spend that money recklessly & suicidedly on Washington's mountain of socialist/communist enterprises.
MOST recipients get more than they've paid into the system. Most, most, MOST!!!
“Lumping these people in with welfare grifters and other SS scammers is going to be seen as an insult on the face of it.”
And where on earth did I do that?
My comment said that I didn’t know anyone who lived on JUST Social Security-——and that’s statement of fact.
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Prove that statement.............
They are both welfare and neither one will run out of money. How is SS running out of money? It has no money to run out of. Todays benefits are paid from todays taxes. The trust fund is an accounting fiction. The idea that SS is some sort of pension is a fiction. It simply takes from one person amd gives it to another.
Do you see any political future were the government stops taking money from person and fiving to another? I do not. You may get paid in worthless dollars or you may noy get paid at all but that wont be from running out of money it will be from a change in the vote buying political calculus.
http://www.taxpolicycenter.org/file/60391/download?token=rxBb5nLq
I doubt it. Use the link above to figure it out. Or just look at your account at the gov website and you can look up your contributions. Dont forget to make sure any stated rate include the employers portion since that is money you earned.
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I’ve run the calcs on my HP12C, and I would easily have over 2 million, even using the most pessimistic rates.
Social Security is a huge rip-off over your life.
I misunderstood. When you mentioned principal i thought you meant contribution only ignoring an return.
I dont see it as a ripoff. It ismdoing exaclty as intended. Creating a government dependent class of people who wil vote for the party that bes protects their interests in Social Security.
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Principal is the core value of the account at any point in time. If deposited into as interest bearing account, it increases until you begin to draw it out.
With social security, they steal half of the deposits, and all of the interest.
How is it not a ripoff?
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It is an above board open and honest program. There is nothing hidden or sneaky about it. Not to say that politicians have not lied about it and mislead people as to its true nature and workings because they have.
SS was conceived as an entitlement welfare program and its funding was a tax transfer. It remains that way to this day. It is a political creation and its destiny is governed by politics. The SC has ruled that SS can be changed by Congress at anytime in anyway and that there are no immutable rights to SS.
The money taken from you today is given to someone else today. There is no fiduciary duty, no trust fund in the normal accounting/legal sense of the word, it is not a sacred obligation, or intergenerational pact, and the fact that you have had a lifetime of government coerced payments does not entitle you to a dime beyond the political expediency of the moment.
There are a couple of things about Social Security that people need to remember:
1. It is not retirement. It is supposed to supplement retirement.
2. MOST people signing up for Social Security retirement are going to receive many more times the money they put into it.
3. The withholdings are going to have to change. This is one time when the “rich” do get away without paying as much. During a time in my work history, after getting my bonus in March I would be finished paying SS for the year. In years with leaner bonuses, I had to wait until September. It would not have hurt me to keep paying into the fund, if it meant I would get my payments when I retired.
No one wants to talk about it, but SS is going to have to change.
With the 30 year bond yield, it would take hundreds of years to make a meaningful return.
The 30-year bond usually yields about 1% more than the CPI. CPI for the past 12 months was 1.5%, and the 30-year Treasury bond is currently 2.48%.
Or, can just buy a TIPS. The yield is adjusted with inflation, and the 30-year TIPS yields 1.00% more than inflation.
It's not a spectacular yield, but it is more than inflation. Boomers retiring now would have purchased 30-year bonds back in the 80's, when they were yielding double-digit returns, and collected those dividends until about now.
However, the real reason I use investment in 30-year Treasury Bonds for comparison is that's the closest analogue to the special obligation Treasury bonds that are held by the Social Security Trust Fund. Those bonds are a bit different, in that their principal value doesn't rise and fall over their lifetime like Treasury bonds. But, the yield is set according to current prevailing yields.
An aside: those special obligation bonds are actual paper, stored in a filing cabinet in the US Government's "satellite" office in West Virginia.
Meanwhile, we will spend $3,400 per illegal alien just keeping them comfortable ...
You can keep repeating this claim, but the repetition doesn't make it true.
I've done the calculations. The current retiring generation (the boomers) break even, overall. It depends on your average wage income -- lower income wage earners have a net gain, but higher income wage earners have a net loss.
Previous generations did indeed do better, because Congress raised benefits, added a COLA, and significantly increased the payroll tax as those generations were retiring. As a result, boomers effectively prepaid a significant portion of their benefits, in addition to paying for the benefits of their parents and grandparents.
However, that presumes that current retirees will continue to receive their benefits, as legislated. If benefits are reduced 20% in about 20 years (required by law, if Congress does nothing), it will affect the calculation.
Both welfare and Social Security benefits are entitlements. By definition, an entitlement is something provided by law. The law can be changed, and there's nothing you could do other than vote against the people that changed it. There's no contract with Social Security -- the Supreme Court ruled in 1960 that SS benefits could be revoked at anytime, for any reason.
It has no money to run out of.
Yes, it does. But, when it runs out, Social Security isn't "bankrupt". It must reduce benefits to the level that can be funded by incoming payroll taxes. Currently, that's expected to be about a 20% reduction.
Todays benefits are paid from todays taxes.
Some, but not all. Social Security has been paying more benefits than it has collected in payroll taxes for the past 5 years. So, the shortage has been withdrawn from the Trust Fund. This will continue until it is exhausted -- estimated to be about 2034.
The trust fund is an accounting fiction.
The Trust Fund isn't fiction. It's invested in the equivalent of US Treasury Bonds, as required by law.
But, it's important to explain where that withdrawal is coming from: the general fund. Redemption of the Trust Fund is a line item in the federal budget. So, it's paid from individual and corporate income taxes. However, since we are running a deficit, it's being borrowed from investors.
The net effect is that the special obligation bonds in the Trust Fund are slowly being converted to US Treasury Bonds. The balance in the SS Trust Fund (currently about $2.8 trillion) isn't included in the official debt, but once the conversion occurs, it is included.
SSI is administrated by Social Security.
But, SSI is funded from the general fund, not Social Security taxes.
The net result is that SSI is actually paid from personal and corporate income taxes, or borrowed from buyers of US Treasury Bonds.
SSI has no effect on the financial status of Social Security.
I think the original poster is referring to what he could have done with the money if it had been invested in an IRA or 401(k), in a balance of equities and bonds. Depending on your average wage income, that's a reasonable amount.
I've actually calculated my investment balance if I had invested my Social Security contributions myself. But, I "invested" them into 30-year Treasury Bonds, at the average rate for that calendar year. So, this isn't hypothetical -- it's the closest analogue I could find to the special obligation bonds in the Social Security Trust Fund.
I'd have about $1 million in my account right now. By the time I started withdrawing benefits, the balance would be about $1.5 million. And if I withdrew the same benefits paid to me by Social Security, I'd exhaust them the year I turned 95.
(An aside: I assumed an average 4% dividend yield and 3% inflation for future years. The actual amounts may be incorrect, but the difference (1%) between the yield and inflation matches historical values.)
However, I could have done MUCH better if I had simply invested the money in an S&P 500 index fund. If I wanted to reduce volatility, I could have split them between an S&P 500 index fund and an intermediate bond fund, and rebalance them to 50-50 once a year. I haven't tried to calculate the actual balance, but it could easily be twice the bond-only balance.
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>> “and that there are no immutable rights to SS.” <<
IOW, it is a total theft program.
Our money goes in, but we have no rights.
You are a soft-headed socialist dolt.
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