Quote:
Originally Posted by Haggar
Your math is way off - first the social security portion is 12.4%, the other 2.9% is medicare. Second the rates were much lower in prior years and the maximum social security wages limits were much lower. As an example in 1962 the wage limit was $4,800 and the social security rate was 2% (each) so total employer and employee contribution to the system was $192.00 You would be surprised how little you contributed for the benefits you receive if you live a reasonable time.
The problem is people are living longer. - a problem for SS funding. Originally five people contributed to 1 retiree. Now the ratio of people working to retirees is much much lower.
I read about five years that the effective growth rate on social security was about 1.75% per year - a poor investment but in some cases forcing people to make any investment for retirement is a godsend considering left to them they would have had no "benefits:
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Many good thoughts in that post.