Social Security can’t save us from the poorhouse

Marketwatch ^ | April 4, 2014, 6:01 a.m. EDT

[wetphoenix]

Financial advisers for years have warned about a looming shortfall between what people have saved and what they’ll need to maintain their standard of living in retirement.

And, certainly, what Americans have put away for retirement is paltry. Unless we all start saving like crazy, the pundits say, we’ll have nothing to live on during our so-called golden years. Or we’ll all have to work into our eighties — if they let us.

But maybe we should look at it another way. For most Americans, Social Security will be their primary source of retirement income. Everything else — IRAs, 401(k)’s, even some old-fashioned defined-benefit pension plans — will be icing on a not-very-rich cake.

The reasons are clear. Tens of millions of Americans don’t have access to 401(k)’s or other retirement plans at work. And millions of families are barely earning enough to cover their current needs, let alone save for retirement.

Suggesting that Social Security will be Americans’ main source of retirement income may seem surprising; after all, the average monthly benefit is only $1,294, according to the Social Security Administration.

But it’s no surprise at all to Dallas Salisbury, president of the Employee Benefit Research Institute (EBRI), a Washington, D.C.-based group that publishes tons of research on the topic.

When I put the question to him in a phone interview this week, he said matter-of-factly: “That’s what all kinds of pensions have always been. The system always has been designed to supplement Social Security for individuals who have had continuous attachment to the labor force.”

[gleeaikin]

In 1983 (Reagan Administration) there was a bipartisan agreement that a wage cap should be established at 90% of all income in the US. After that wages at the top started increasing 10% to 20% a year, while the wage cap appears to have been set at inflation (2% to 4%). By the mid 1990s it was down to 85% and recently has been as low as 82%. All they need to do is put it back to 90% and keep it there.

[AlexW]

There is no way that I could live on my SS in the USSA.
As an expat, however, I have a very fine life on my minimal SS.

[clearcarbon]

The more money Americans manage to put away for retirement, the more determined the government becomes to steal it from them.

Quantitative easing was a really clever way to accomplish this theft.

[Kozak]

So do I get a larger benefit to match the bigger contribution, or do you just plan on helping yourself to more of my money?

[Lake Living]

You are exactly right clearcarbon. That’s what my wife and I are now facing. One of us is most likely going to have to return to working part time.

[windsorknot]

The history of government entitlement programs clearly demonstrate the folly of big government central planning. The implications for the ACA are clear.

[galtman]

To where did you emigrate ... thinking about the doing same thing?

[SkyPilot]

401K stock market bubble, fictitious highs due to Fed pumping, 10,000 Baby Boomers retiring per day, low savings, 22% real unemployment, the US Dollar about to lose its status as the World's Reserve Currency - all of this is a recipe for disaster.

As health insurance costs for retiring Baby Boomers goes ballistic due to ObamaCare, more and more and more money will be withdrawn from the stock market so that aging Boomer can survive - literally. Medicare Advantage is now being cut, and the cuts will only get worse. As people get sick, they will have to rely on their own money to relieve pain and suffering for themselves, or a loved one.

The younger workers don't even have the same capacity to invest as the older generation did. The money that everyday workers (not professional investors) threw into the stock market to help inflate prices won't be there. Fed Pumping has also led to a bomb of flamed gasoline that is ready to explode. "Financial Advisers" wave their hands and tell everyone that this will never happen, because all Boomers won't retire at the same time. They never figured on ObamaCare ruining the financial lives of millions of people.

[SkyPilot]

Oh, and the cuts to Medicare Advantage are today's headline on The Hill:

http://thehill.com/blogs/healthwatch/medicare/202702-obamas-new-healthcare-dilemma

Health care is bankrupting the nation - Medicare and Medicaid alone consume a majority of the Federal budget:

People who think their retirement accounts will not be consumed by this looming disaster are smoking something.

[SkyPilot]

Correction - I should have said a great majority of the budget, not majority in over 50%.

[galtman]

Thanks for getting back to me ... thinking fairly seriously about Finland ... if I am going to live under socialism, better to do it with experts ... seems to be renowned for a good and efficient government. Spent some time there with my eldest who is an opera singer and was there singing the lead in the Savonlinna Opera Festival ... we were all treated like royalty!

[windsorknot]

Many will criticize those who make the decision to escape from Amerika, but one day Big Brother may attempt to thwart that option, especially if you are a productive achiever.

[OldPossum]

There is no way that I could live on my SS in the USSA. As an expat, however, I have a very fine life on my minimal SS.

There you go again, Alex. You really just cannot help yourself, can you? You just have to put down the USA and tell us again how poor you are at financial planning. You sniveling little excuse for an American.

As you can see, the Dawg Pack has been duly notified.

[9YearLurker]

I’d be interested to hear what you’ve learned in retiring as an ex-pat.

[AlexW]

” thinking fairly seriously about Finland .”
_____________________________________________________
I know zero about Finland/Scandinavia. Everyone has to choose whatever floats their boat. I enjoyed my years in Slovakia and would still be there if not for other turns of events.
Oh, last month a Slovak and British friend came to visit me.

[BobL]

Congratulations on getting out, and sooner, rather than later!!

You are, of course, right. I think, in the end, the key was when the unions decided that it was worth the cost of massive Third World immigration to assure a Democrat majority...which then would give them unopposed power (both the unions and the Democrats).

And so the Democrats got permission to team up with big business owners to massively increase immigration from south of the border, both legal and illegal, and the expected demographic shift started taking place - with Hispanics now a MUCH LARGER minority in this country than blacks (who are still holding their ground, by the way).

To finish the job, all that is needed is some form of Amnesty - be it the Senate bill (i.e., citizenship for Illegals), which finishes off this country in a couple of decades, or the Cruz amendment (i.e., legal status for today’s Illegals, but rejected by the Senate as not going “far enough”), which finishes off the country in 3 or 4 decades.

Either way, it’s essentially game over now. Like it or not, we were outsmarted - once the Chamber of Commerce, the Unions, and the Democrats started marching in lock-step to flooding this country with Third World types, we NEVER had a chance.

So enjoy life there - the demographics there are probably much more stable than in the US, as we’re sliding down quickly.

[sodpoodle]

http://ezinearticles.com/?Collecting-Social-Security-If-Retiring-Abroad&id=4982636

The US treasury reports that they send 450,000 Social Security checks overseas...the State Department estimates that over 5 million Americans live outside the US.
**********************************************************

Money that is not spent in the US - creating jobs etc., Foreign aid by any other name is still taken out of the American tax-payers pocket.

Shameful!

[WVKayaker]

As you can see, the Dawg Pack has been duly notified.

Wow, you've done it now Alex.

Like you in Cebu, I am shaking in my boots here in Davao, because of the "dawg pack".

Things are going well here, and soon I will be President of a Corporation here, providing a retirement community for Americans. We have already made the necessary applications, and made an agreement to take over a resort here, so we have nothing to build. I know that Social Security is not going to be enough, as they are devaluing the US Dollar by their fiscal policies.

What a bunch of poseurs who have nothing good in their lives, obviously. Why else would they waste time on people smart enough to be ahead of the curve. What a bunch of losers...