[Bill14564]

Originally Posted by PilotAlan

There's a few things that people need to understand:

1 - There IS NO SS TRUST FUND. Current workers' taxes pay current retirees. Income in excess of benefits was "loaned" to the government and SPENT decades ago. Yes, SS holds Treasury bonds for those amounts, but that means nothing.
It's essentially like borrowing the money from your 401(k), spending it all, and saying "I'm set for requirement, my 401k has a million dollars in loans due to it!"

2 - You have NO RIGHT to SS benefits. The Supreme Court ruled long ago and multiple times that Congress can change the terms if SS at any time, or eliminate it entirely, and they don't owe you a penny.

3 - If someone averaged $50,000 a year for 45 years, and invested the money that Social Security would take, they would have over $2 MILLION DOLLARS after 45 years (20yo-65yo).
That's over $100,000 a year in retirement with essentially no chance of running out of money. Plus leaving substantial assets for a surviving spouse, or children.
Purchasing an annuity with that $2m would generate a guaranteed lifetime income of approximately $150,000.

1. The collection of loans owed to the SS Trust Fund are backed by the USG. I believe SS can (and does) call on part of those loans every year to make up the difference between what is collected and what is paid out. They will exhaust those markers in about eight years if nothing changes.

3. The average salary does not matter, the actual salary does. Working with the average salary will skew the compound interest from the earliest years. Working with the actual salary will show slow growth early and faster growth later but less than the growth seen when using the average. I'm tired of doing math for this thread.