Posted on 10/28/2017 3:57:33 PM PDT by SeekAndFind
Many Americans rely on Social Security benefits to see them through retirement, but how much should they really be depending on those checks?
Not very much, experts said.
Social Security is not being used as it was intended, said Ric Edelman, executive chairman and co-founder of Edelman Financial Services in Fairfax, Va. and author of “The Truth about Your Future.” When Congress and President Franklin D. Roosevelt created the system in 1933, the program was designed to be a safety net for Americans — for those who had no financial support. Now, “a great many Americans are relying heavily on Social Security to maintain their lifestyle in retirement.”
More than 66 million people received Social Security and/or Supplemental Security Income in August, more than 46 million of which were Americans 65 and older. Social Security makes up a majority of cash income for 61% of elderly beneficiaries, and a third rely on this benefit for 90% or more of their income, according to the Center on Budget and Policy Priorities, a governmental budget policies think tank based in Washington, D.C. The average monthly retirement benefit under the Old-Age and Survivors Insurance was $1,326, according to the Social Security Administration.
Retired workers received an average of $1,371 while spouses of retired workers received $714 and children of retired workers received $659. “Social Security is funding as last resort, and if it goes away there is no government program to serve as a fall back,” Edelman said. “This is the fall back.”
How did Americans get here?
Unfortunately, it’s a familiar story: many Americans just haven’t saved enough for retirement, either because of poor planning or an inability to put money away for their futures.
(Excerpt) Read more at marketwatch.com ...
social security... will be nothing but extra “play” money for me.
Yep.... personally, if they would give me back all the money I paid in..... in today's dollars.... I would take my contribution and let them off the hook....
Putting the work force back to work, increasing government receipts by 100-200%...
That’s going to make a lot of things more healthy.
During the process, we need to get to work with a robust plan to help people develop retirement systems of their own.
Phase the government out of it over 40 years.
Within 20 years, we could have the government out of 30 to 50% of the old Social Security plan, and 50% of the public headed to retirement fully vested in their own non-government plans.
We just need to get to work on it, NOW...
I think they will screw the younger folks, and keep paying old farts because the old farts vote in much better percentages.
I am not counting on it, though I wish I could have invested that amount for myself over the years.
This guy is conflating Title II, Retirement Survivor, and Disability Insurance, with Title XVI, Supplemental Security Income.
RSDI is an entitlement only for people who have paid enough FICA tax to be covered. SSI is a welfare program administered by the SSA, but the money comes from the general fund, not from FICA taxes. SSI is indeed a “program of last resort,” as shown here:
https://www.ssa.gov/oact/ssir/SSI13/III_ProgramDescription.html
RSDI is most definitely NOT a program of last resort.
If you don’t understand the difference between RSDI and SSI, you don’t know enough to make an intelligent statement about either program. They’re as different as football and baseball.
Same. Will go towards additional traveling - probably all of it, which means a lot of travel.
It’s my mom’s (99 y.o.) main source of income. But she makes just enough to make her eligible for MediCal benefits that would make her last years much more comfortable. Meanwhile, of course, people who’ve paid next to nothing into the tax system get a free ride. Oh well.
Anyone old enough to remember the magazine ads saying “We retired to Florida on $300 a month!”
But I agree, too many depend on SS and haven’t saved enough to take care of themselves in retirement. Because I draw a state pension, 60% of my Social Security is withheld—don’t want any “double dipping”.
The first step would be to put the “employer contribution” on paychecks as a deduction to the employee.
It costs the employer nothing to pay it to the employee instead of the government (might need a tax change)- it’s just a different accounting entry.
Politicians hate for people to see their taxes.
Some who don't rely on the income would do it and invest it.
Some may be I'll with a terminal illness and could use it now.
This is such bullcrap. That its “only meant to be a supplement”. It would be criminal if an investment house took 12.5% of your salary, invested it over 45-50 years, and then said you shouldn’t count on it it.
Utterly insane.
A person who works from age 18 to 65, earns an average of a modest 50k and saves 12.4% of it, and invests it all that time could easily have well over a million dollars in savings. And they could live off it, and pass it on to their heirs.
Stories like this are how the deep state flips you the finger and laughs at you.
To fill the gap, we need to pass a law mandating employers to begin withholding from paychecks during working years to deposit in a personal security account.
That way people will have a nest egg waiting for them when they retire and it would be in addition to what they would get from Social Security.
We need to seriously think about ways to strengthen and to preserving retirement income and this is a challenger with people getting older and living longer.
“too many depend on SS and haven’t saved enough to take care of themselves in retirement.”
Oh, they did. And they did so at gunpoint. 12.4% of their pay from age 18 or whenever to retirement age 45 years later. Only the fiduciary has stolen it and is blaming you for not saving for yourself.
Its criminal.
“Yep.... personally, if they would give me back all the money I paid in..... in today’s dollars.... “
LOL! For that $1 I paid in 1964 I am getting $1 in todays dollars.
Uh, they forgot something here...lol
They forgot to mention wages were in decline and or have been stagnate for decades....Just a wild guess, but I would imagine this would be a sizable factor here.
| Item | Value |
|---|---|
| SS Percent | 6.20% |
| Earning Cap | $127,200 |
| Max Annual SS "Contribution" | $7,886 |
| Work Years Pay In | 44 |
| Nominal Annual Return | 8% |
| Future Value | $3,193,000 |
| Retirement Years | 25 |
| Annual Withdrawal | $299,100 |
It looks like SS is a huge ripoff. But, if you look at REAL earnings rates (i.e., inflation adjusted dollars - NOMINAL Rate minus INFLATION Rate), you're still getting ripped off. SS is paying you less than half of what you would make on your own:
| Item | Value |
|---|---|
| SS Percent | 6.20% |
| Earning Cap | $127,200 |
| Max Annual SS "Contribution" | 7886 |
| Work Years Pay In | 44 |
| Nominal Annual Return | 8% |
| Inflation Rate | 4% |
| Real Annual Return | 4% |
| Future Value | $945,400 |
| Retirement Years | 25 |
| Annual Withdrawal | $60,500 |
The absolute worst thing about SS is you don't have any equity to pass to your heirs. If you saved on your own and croaked the day after retiring, your heirs would have a nice payout.
.
They can just give me the money back with compound interest, and I’ll call it square!
.
As a child I thought Social Security was a welfare program. My grandfather retired and for some reason I knew he was taking SS check. He didn’t need it. I asked him why he took money from the govt. He looked at me in awe and said “Because it is my money”.
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