[tpop1]

Originally Posted by buggyone

Just a question here - not an arguement.

Let's say you worked for 40 years at a job and paid your 5% salary deduction into Social Security for all the years. You retire and start drawing your monthly Social Security benefit at age 65. You (let's assume) live to be 90 years old. In those 35 years between age 65 and 90, will you have taken out more or less than what you put into Social Security over the 40 years of working?

If the answer is more, then Social Security is an entitlement? Also what if your spouse has never worked, don't they get part of the Social Security benefit also?

Your contribution since 1991 has been 7.65% by you and 7.65% by your employer into your account for a total of 15.3% of your yearly salary.

If you earn the Max for 45 years compounded at 5% at the end of that period the pot of money in YOUR account would be $725,744!!

At 5% interest this pot would yield $36,287 per year, which is more that your SSA payments. If you acturalize it over the next 30 years to age 95, it would throw off $47, 210.

Yes not all employees earn the Max and subsequently their SSA payment do not max out either!

I will share my spreadsheet if anyone would like it - just PM me with an email address.

Blueash - My whole point is that it has been mismanaged and IMHO if it was managed correctly, it would have gone on it forever and provided for all you mention!

[hdh1470]

Originally Posted by blueash

Social Security is not a company pension (and by the way lots of companies have reneged on their pension obligations). The money you and I have paid in all these years is not ours and was used to pay those who preceded us. Some of them paid in over 40 years as we did, and many did not. It also paid for widows, disabled citizens and children. Social Security has enough reserves and enough anticipated future income to continue to pay full benefits for another 25 plus years. It does not contribute to the deficit as it is actually right now operating at a profit when you combine the contributions and the income generated by the invested assets. The well runs dry in about 2036. There is not any crisis in Social Security. With no adjustments it can pay 75% of its promised benefits after 2036 until 2085. With minor tweaks it can pay 100% forever.
The crisis is in Medicare which none of us paid enough into to make the claim we are owed it because of our investment. A recent analysis finds that the average person retiring in 2011 has paid only 1/3 of the cost of their medical care. The number is less for those who retired earlier as they had fewer years of paying into medicare. http://www.cleveland.com/nation/inde...rees_paid.html
Social Security is safe and should be left alone. We need to be realistic about Medicare being an unsustainable program in its current configuration. Either the benefits need to be cut or the payments into the system increased. Sorry for the long post.

Spot on

[swimdawg]

Originally Posted by Bill-n-Brillo

Gracie, could you loosen up just a bit and share your true feelings on the topic with us all, please?

Bill

Yeah, Bill...she's in running for the SWIMDAWG Best Post of the Day Contest!

[annmarie]

Great to hear like minds, we all worked for it!!

[MikeH]

What everyone seems to forget is:

1. Social Security is a Social program and unlike pure insurance each person will not necessarily get a full return on their "investment". Some will get more and some will get less. If you die when you're 61..you loose. If you live into and beyond your 80's....you received more than you paid in.

2. Everyone seems to forget that during those 40-45 years you were working the program would have provided monthly benefits to you and your family had you become disabled or to your surviving family had you died.

3. If your employer didn't have to pay the 6.75% tax would your salary have increased by that much? Dream on......

Most of us think of Social Security as only a retirement program so we calculate our return on investment at that point. What if we'd become disabled at age 25 or 30 with a spouse and two or three children? What then would be our return on our investment? Can anyone purchase an ins. policy that gives the same protection as Social Security for the same "investment"?

[villagegolfer]

I remember my first paycheck when I was in early teens. My father (my boss) saw the expression on my face when I looked at my paycheck and started laughing. I was shocked. I said where did all the money go? That's when I really learned about Social Security and tax deductions. That was almost 50 years ago.

[Number 6]

Entitlement program
The kind of government program that provides individuals with personal financial benefits (or sometimes special government-provided goods or services) to which an indefinite (but usually rather large) number of potential beneficiaries have a legal right (enforceable in court, if necessary) whenever they meet eligibility conditions that are specified by the standing law that authorizes the program. The beneficiaries of entitlement programs are normally individual citizens or residents, but sometimes organizations such as business corporations, local governments, or even political parties may have similar special "entitlements" under certain programs. The most important examples of entitlement programs at the federal level in the United States would include Social Security, Medicare, and Medicaid, most Veterans' Administration programs, federal employee and military retirement plans, unemployment compensation, food stamps, and agricultural price support programs.

Sorry, but it is what it is.

[2BNTV]

Originally Posted by villagegolfer

I remember my first paycheck when I was in early teens. My father (my boss) saw the expression on my face when I looked at my paycheck and started laughing. I was shocked. I said where did all the money go? That's when I really learned about Social Security and tax deductions. That was almost 50 years ago.

I remember twenty years ago when my son got his first paycheck and said to me, "dad, I just got my first paycheck and you'll never guess how much they took out". I said, "I think I have a very good idea and delinated all the deductions for him. When he asked, "how did you know".

I said, "welcome to the world of reality".

He was incredulous they took so much money out of his paycheck.

[GTTPF]

It is my understanding that the money being put into SS now is paying for the people that are collecting now. Not what we have put in. I have also maxed out SS every year. Being self employed most of my life I paid double SS, the employers portion and the employees portion until the last couple of years when it was changed. I am not, nor have I ever complained about paying my fair share of taxes. We all agree they are necessary. We are and always will be "entitled" to collect SS benifits. Retirement supplement for all working people is why it was set up in the first place. If the goverment would leave their grubby hands out of it there would be plenty of money in SS! IT IS NOT their slush fund to use as they please! Contrary to what they might think! There should be laws protecting the SS fund. Do you seriously think that congress is going to pass them? Not a chance! They would be cutting their slush fund. If SS was used the way it was originally intended there would be a huge amount of money to fund it and your monthly checks would be much higher. Legal and illegal imigrants come to this country, never work a day, put their hand out and we give them everything. Something is very wrong with this picture! That's my story and I am sticking to it!

[JimJoe]

I think you are mixing entitlement with welfare.
An entitlement is considered a guarantee of access to benefits based on established rights or by legislation. By Definition, Social security is an entitlement...
BUT if you do not get back more than you pay in plus a reasonable interest on your money, it is NOT WELFARE.
You earned.. and You DESERVE IT.. and WE SHOULD HAVE A RIGHT TO OUR MONEY!!
We should not allow the government to redistribute it to someone else.. then (as is our current system), it becomes welfare.

I think the solution to social security and make is solvent is to pay back to the contributor in the form of an annuity every dime plus a reasonable rate of interest to those who paid.. AND NO MORE. If you die before you receive back your entire investment, it goes to your estate.
Those who need welfare after their social security is gone should apply for welfare.
I am ready for the predator drone attack.
JJ

[JimJoe]

Originally Posted by blueash

Social Security is not a company pension (and by the way lots of companies have reneged on their pension obligations). The money you and I have paid in all these years is not ours and was used to pay those who preceded us. Some of them paid in over 40 years as we did, and many did not. It also paid for widows, disabled citizens and children. Social Security has enough reserves and enough anticipated future income to continue to pay full benefits for another 25 plus years. It does not contribute to the deficit as it is actually right now operating at a profit when you combine the contributions and the income generated by the invested assets. The well runs dry in about 2036. There is not any crisis in Social Security. With no adjustments it can pay 75% of its promised benefits after 2036 until 2085. With minor tweaks it can pay 100% forever.
The crisis is in Medicare which none of us paid enough into to make the claim we are owed it because of our investment. A recent analysis finds that the average person retiring in 2011 has paid only 1/3 of the cost of their medical care. The number is less for those who retired earlier as they had fewer years of paying into medicare. http://www.cleveland.com/nation/inde...rees_paid.html
Social Security is safe and should be left alone. We need to be realistic about Medicare being an unsustainable program in its current configuration. Either the benefits need to be cut or the payments into the system increased. Sorry for the long post.

There is not a Dime in reserves.. NOT ONE DIME. They have spent every penny.. to not only pay benefits but also finance the general spending when social security income exceeded expenditures.
The so called reserves are a stack of IOUs from a government that has a 15 TRILLION DOLLAR DEBT.. that is growing by more than a TRILLION a year.
The fed is destroying the value of the dollar every day. Your purchasing power is going down daily. They know it and are doing it on purpose to pay for the excessive government spending.. that both parties use to get elected. .. nibbling away at your savings.. hoping you will not realize it.
That is the unfortunate truth and it will never change until enough people wake up and vote for a true reduction in a change in the Federal Reserve, and in the Federal, state, and local government.

[Taj44]

Originally Posted by MikeH

What everyone seems to forget is:

1. Social Security is a Social program and unlike pure insurance each person will not necessarily get a full return on their "investment". Some will get more and some will get less. If you die when you're 61..you loose. If you live into and beyond your 80's....you received more than you paid in.

2. Everyone seems to forget that during those 40-45 years you were working the program would have provided monthly benefits to you and your family had you become disabled or to your surviving family had you died.

3. If your employer didn't have to pay the 6.75% tax would your salary have increased by that much? Dream on......

Most of us think of Social Security as only a retirement program so we calculate our return on investment at that point. What if we'd become disabled at age 25 or 30 with a spouse and two or three children? What then would be our return on our investment? Can anyone purchase an ins. policy that gives the same protection as Social Security for the same "investment"?

Good points.

[JimJoe]

Originally Posted by MikeH

What everyone seems to forget is:

1. Social Security is a Social program and unlike pure insurance each person will not necessarily get a full return on their "investment". Some will get more and some will get less. If you die when you're 61..you loose. If you live into and beyond your 80's....you received more than you paid in.

2. Everyone seems to forget that during those 40-45 years you were working the program would have provided monthly benefits to you and your family had you become disabled or to your surviving family had you died.

3. If your employer didn't have to pay the 6.75% tax would your salary have increased by that much? Dream on......

Most of us think of Social Security as only a retirement program so we calculate our return on investment at that point. What if we'd become disabled at age 25 or 30 with a spouse and two or three children? What then would be our return on our investment? Can anyone purchase an ins. policy that gives the same protection as Social Security for the same "investment"?

If the Government had not used FORCE to TAKE your money for social security, you could have invested it and obtained a 10 fold return more than SS for which you could have easily purchased life insurance to pay far more than SS death benefits cover.

You can negotiate your pay.. so no one knows if you could have gotten the employer share of SS included in your pay. Just because no one knows, does not mean you would NOT have gotten.

Where in the Constitution does the federal government have the right to create this social welfare program? No where. In fact it is specifically prohibited by the 10th amendment.

yes many have benefited.. but many have lost much also.

[tpop1]

Originally Posted by JimJoe

There is not a Dime in reserves.. NOT ONE DIME. They have spent every penny.. to not only pay benefits but also finance the general spending when social security income exceeded expenditures.

My point that I started this thread with, that SSA is not an entitlement....maybe should have stated that it should not be viewed as an entitlement!

We paid in enough, ourselves and our employers, to have had expectations of fund large enough to pay our SS Monthy benefits til we die with interest alone; thereby leaving the full amount of that pot to be used for all the other real entitlements listed in this thread.

Add to that amount all SS taxes collected for people who died before collecting, there would NEVER be an issue with SS being self sufficient FOREVER.

It is because those in office could not resist getting their hands on this easy money for pork, handouts, and other pet projects; that there are questions on its sustainablility. This dipping began if I remember with LBJ's Great Society initiatives.

Total mismanagement by elected officials of all stripes has gotten us to where we are today.

[Hal :-)]

Originally Posted by tpop1

Your contribution since 1991 has been 7.65% by you and 7.65% by your employer into your account for a total of 15.3% of your yearly salary.

If you earn the Max for 45 years compounded at 5% at the end of that period the pot of money in YOUR account would be $725,744!!

At 5% interest this pot would yield $36,287 per year, which is more that your SSA payments. If you acturalize it over the next 30 years to age 95, it would throw off $47, 210.

Yes not all employees earn the Max and subsequently their SSA payment do not max out either!

I will share my spreadsheet if anyone would like it - just PM me with an email address.

Blueash - My whole point is that it has been mismanaged and IMHO if it was managed correctly, it would have gone on it forever and provided for all you mention!

I don't understand how "entitlement" became a bad word. I believe Social Security is an entitlement. You are entitled to the benefit because you paid the premiums all those years. I don't believe there is any definition of Entitlement that says Handout or anything like that. If you earned it, paid for it, or received it as a benefit, it's an entitlement.

You can not calculate an ROI because it's a community program. It's retirement insurance. Like all insurance, there are winners and losers. Although you may not want to be a big winner on your Auto, File, Health, and Homeowners insurance. You make years of premiums and never have a claim and you're probably very happy never having a claim. I suppose everybody is a winner on life insurance, although the big winner dies the day after he takes out the policy.

The calculation gives the impression of a big ripoff. Actually many in that scenario may do better. There's no way to get a risk-free 5% these days, but the $36,287 is a bit less that a couple would get in guaranteed inflation protected benefits, with just 35 years at the max. Currently, the max FRA benefit is about $2366/mo, a spouse would get 50% of that for $3549/mo, $42,588/yr. Factor in multiple marriages, disability, under age children, and you could be considerably more. And it's all with annual COLA increases.

Social Security is simply a retirement insurance policy. It's insurance by ever measure. Many people don't realize the payroll tax is not deductible. You paid income tax on those premiums (FICA), just like any other insurance premium. Normally, insurance premiums are paid in post-tax dollars and the benefit is tax-free. Of course that's changed now, Social Security benefits can be partial taxed.

Social Security is sound. It may need some tweaking because we're living longer and it covers more. But there's no rush on that. It has produce a surplus every year for 75 years. By law the SSA can not borrow money. Imagine the early days when everyone started paying in and few collected. Huge surpluses, never accounted for. A couple decades ago, recognizing that the Baby Boomer Bubble was on the way, the rate was increased to accelerate collections and build the trust fund. It worked very well. Most of the boomers will be gone when when the Trust Fund runs out (if we ever use it).

While it's true that those excess contributions over the years went into Treasuries, which essentially went out the other door and into the general fund. It's not entirely fair to say politicians stole or misappropriated. The law specifically stated that the excess must go to US Treasures, full faith, and all that stuff. In fairness, there really was little other choice. Where do you put $2.6 Trillion? Ideally, it would have been invested, diversified in stock, bonds, etc. But no one would go along with that. And you're certainly not going to stack up dollar bills in the corner somewhere. So US Treasuries was the only realistic option. And, BTW, they do pay interest.

We're approaching the point where not enough is coming in to cover the outgo for Social Security. There's some $2.6 trillion in the fund now, over 99% from the middle and lower class. If those Treasuries are cashed in, it has to come from somewhere. Hence, all the screaming about Social Security. Even though it never contributed one penny to the deficit, and in fact, always contributed to reducing the deficit. The cries (mainly from the right) call for changes to Social Security to avoid raising taxes on the rich, and avoid needing to access the trust fund Treasuries. They want to maintain excess contributions from the middle class to maintain the low tax rates for the top 1%. Simple as that.

[ame]http://www.youtube.com/watch?v=PPeUrJF6AM8[/ame]