I didn't realize just how lousy a deal Social Security is . . .

Marvin the Martian

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So true... for those who think there's very little risk just look at the Japanese Stock Index. It has never recovered to the 1990 level.

What is someone going to do with their money that is totally risk free? 2008 showed just sticking it in the bank. Jeremy Clarkson used some Swiss financial group that told him to move mass sums to AIG "advanced fund" for the richest of the rich because it was completely safe. Of course it wasn't.

Many workers may soon discover Social Security wasn't 100% safe.
 

NPT

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What is someone going to do with their money that is totally risk free? 2008 showed just sticking it in the bank. Jeremy Clarkson used some Swiss financial group that told him to move mass sums to AIG "advanced fund" for the richest of the rich because it was completely safe. Of course it wasn't.

Many workers may soon discover Social Security wasn't 100% safe.
Yeah there is no risk free environment but there are degrees of risk. Investing in a stock is definitely more risky than investing in a CD as far as actually losing your money. The only reason I brought the Japanese stock market up is that some on here act as though there is very little risk so capital gains should be taxed as ordinary income so I was just pointing out that there are risks.

In 2008 I moved both (wife and I) of our 401Ks into a stable income fund. I'm sure there was some risk there but we made about 4% on our investments.
 

Marvin the Martian

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Yeah there is no risk free environment but there are degrees of risk. Investing in a stock is definitely more risky than investing in a CD as far as actually losing your money. The only reason I brought the Japanese stock market up is that some on here act as though there is very little risk so capital gains should be taxed as ordinary income so I was just pointing out that there are risks.

In 2008 I moved both (wife and I) of our 401Ks into a stable income fund. I'm sure there was some risk there but we made about 4% on our investments.

Doesn't the market pay more, on average, than a government bond (for example)? Isn't that how risk is rewarded?

I am not familiar with Japan's market. In this country for many years people bought stock and held it for the dividend. That was the purpose. Then suddenly dividends became somewhat irrelevant, we wanted growth. In theory, even if the market flatlined today for the next 20 years, you will still have dividend profits for your investment more matching how people invested back in the prehistoric times.
 

NPT

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Doesn't the market pay more, on average, than a government bond (for example)? Isn't that how risk is rewarded?
That is true.... more rewards for more risk. The government decided that people deserved a tax break for taking more risk and that would encourage them to invest capital in businesses.
 

82hoosier

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until I did some quick calculations this morning. I'm 59 and I'm thinking about retiring (again) at 62, give or take. So I logged into my social security account and saw that if I elected to get payments at 62 I'd bet almost $2100 a month and if I delayed to 70 I'd get almost $3100 a month. I and my employers have contributed more than $310,000 so far. If I stuffed that money in a closet every year and didn't earn a penny of interest I could take out $2100 a month for 12 years and $3100 a month for 8 years. If that was the case, SS looks OK. However, using an investment calculator and a conservative interest rate of 6% (well less than an investment in the stock market would average over 40 years) and under estimating my average contribution per year, my account would be worth more than $7 million. Using a ridiculously conservative rate of 3%, it would be worth $3.5 million. If I withdrew $2100 per month I'd be able to do that for 138 to 273 years (3% return and 6% return amounts) and $3100 a month for 94 to 185 years. Of course if I had either amount of that I'd probably take out much more. I could take out more than I actually currently make each month if I wanted to and it would still last many more years than I have left on earth. I could throw in a couple of long international vacations each year too without sweating it. I could play Pebble Beach a few times every year to boot. Obviously, I make and contribute more than most Americans (currently, but most of my life my income was below to just above average), but even halving the calculations the account would be worth far more than what the average American will receive in benefits for the remaining 15 to 20 years of his/her life. Doing the calculations with the average American's income also shows Social Security is a lousy deal as well.

I've said it many times, and I'm more convinced than ever, that Social Security is a good idea, but it was set up in a ridiculously inefficient way making it a lousy deal for the majority of Americans. Thrift Savings Plans (TSP) for all Americans would be far more efficient and would prove lucrative to probably 80 to 90 percent of Americans. It would also be sustainable and not threaten insolvency for our federal government. The remaining 10% could be provided minimum Social Security safety net benefit.

My TSP is worth nearly $400K to date and I couldn't even have one until at least half my military career was over because military weren't eligible for them until then. If I had been able to contribute since I joined the military in 1985 it would probably be worth a couple mil. If I could have contributed from my first paycheck until now - it would be worth millions (see first paragraph). Once again, Social Security is a lousy deal for the vast majority of us.
Don’t forget that when Ronald Reagan reduced the ridiculously high 70% marginal personal income tax rate he funded it by taxing Social Security benefits for the common man.
 

NPT

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Don’t forget that when Ronald Reagan reduced the ridiculously high 70% marginal personal income tax rate he funded it by taxing Social Security benefits for the common man.
It's good that the president doesn't have the power attributed to them. All the president can do is ask for something but congress has to initiate and pass bills so look at congress when something like that happens. Of course, Reagan could have vetoed the bill. The thing is that Reagan and Tip O'Neill were political opposites but they could negotiate and come up with something where each had to give up things they wanted and got things they wanted...something that is impossible now it seems.
 

IUXC68

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until I did some quick calculations this morning. I'm 59 and I'm thinking about retiring (again) at 62, give or take. So I logged into my social security account and saw that if I elected to get payments at 62 I'd bet almost $2100 a month and if I delayed to 70 I'd get almost $3100 a month. I and my employers have contributed more than $310,000 so far. If I stuffed that money in a closet every year and didn't earn a penny of interest I could take out $2100 a month for 12 years and $3100 a month for 8 years. If that was the case, SS looks OK. However, using an investment calculator and a conservative interest rate of 6% (well less than an investment in the stock market would average over 40 years) and under estimating my average contribution per year, my account would be worth more than $7 million. Using a ridiculously conservative rate of 3%, it would be worth $3.5 million. If I withdrew $2100 per month I'd be able to do that for 138 to 273 years (3% return and 6% return amounts) and $3100 a month for 94 to 185 years. Of course if I had either amount of that I'd probably take out much more. I could take out more than I actually currently make each month if I wanted to and it would still last many more years than I have left on earth. I could throw in a couple of long international vacations each year too without sweating it. I could play Pebble Beach a few times every year to boot. Obviously, I make and contribute more than most Americans (currently, but most of my life my income was below to just above average), but even halving the calculations the account would be worth far more than what the average American will receive in benefits for the remaining 15 to 20 years of his/her life. Doing the calculations with the average American's income also shows Social Security is a lousy deal as well.

I've said it many times, and I'm more convinced than ever, that Social Security is a good idea, but it was set up in a ridiculously inefficient way making it a lousy deal for the majority of Americans. Thrift Savings Plans (TSP) for all Americans would be far more efficient and would prove lucrative to probably 80 to 90 percent of Americans. It would also be sustainable and not threaten insolvency for our federal government. The remaining 10% could be provided minimum Social Security safety net benefit.

My TSP is worth nearly $400K to date and I couldn't even have one until at least half my military career was over because military weren't eligible for them until then. If I had been able to contribute since I joined the military in 1985 it would probably be worth a couple mil. If I could have contributed from my first paycheck until now - it would be worth millions (see first paragraph). Once again, Social Security is a lousy deal for the vast majority of us.
You should report your concerns to your elected federal representatives.
 

DANC

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Many with credible retirement programs were originally exempted. My dad worked for Penn Central and was exempted. 9f course Penn Central stole from the retirement funds and then went bankrupt leaving workers with nothing. Congress changed the law allowing railroad workers to collect Social Security even though they never paid into it.
My wife's grandmother was getting her deceased husband's RR pension, Social Security, and her pension.

Boy was she pissed when Reagan cut out her RR widow's pension.
 
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UncleMark

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My wife's grandmother was getting her deceased husband's RR pension, Social Security, and her pension.

Boy was she pissed when Reagan cut out her RR widow's pension.

Looks like you married into a family of lazy entitled takers.
 

DANC

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Looks like you married into a family of lazy entitled takers.
Well, they're in-laws, so......

Actually, this grandmother got a job with the welfare dept (not sure what it was called, exactly), and she worked cases. She worked until she was well into her 70s. Now, this woman was a HUGE Democrat - said she'd vote for a dog before she would vote for a Republican. Also said Lincoln was drunk when he signed the Emancipation Proclamation - and she was serious. I guess that's what they taught in Tennessee, where she grew up. Needless to say, she wasn't real sympathetic to her welfare cases. That's when I learned how caring Democrats were.
 

JamieDimonsBalls

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I am not familiar with Japan's market. In this country for many years people bought stock and held it for the dividend. That was the purpose. Then suddenly dividends became somewhat irrelevant, we wanted growth. In theory, even if the market flatlined today for the next 20 years, you will still have dividend profits for your investment more matching how people invested back in the prehistoric times.

Im surprised that you are in favor of shareholder return mechanisms (e.g., dividends) instead of growth reinvestment
 

UncleMark

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Well, they're in-laws, so......

Actually, this grandmother got a job with the welfare dept (not sure what it was called, exactly), and she worked cases. She worked until she was well into her 70s. Now, this woman was a HUGE Democrat - said she'd vote for a dog before she would vote for a Republican. Also said Lincoln was drunk when he signed the Emancipation Proclamation - and she was serious. I guess that's what they taught in Tennessee, where she grew up. Needless to say, she wasn't real sympathetic to her welfare cases. That's when I learned how caring Democrats were.
A Southern Democrat from 50s and 60s bears zero resemblance to today's Democrat. But you know that. Nice try.
 

DANC

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A Southern Democrat from 50s and 60s bears zero resemblance to today's Democrat. But you know that. Nice try.
No, they're still the same. Look at the racist abuse heaped on Tim Scott simply because he is a black Conservative who daresto speack against the Democrat positions on racism.

And then you have Joy Bahar who says he doesn't understand racism in America.... no, the Democrats still have the plantation mentality - blacks need to stay in their place or else.
 

Marvin the Martian

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Im surprised that you are in favor of shareholder return mechanisms (e.g., dividends) instead of growth reinvestment
Just saying there was a time where IBM and P&G and the like were the gold standard because of solid returns. I do not know which is better.

I had buddies at P&G when their CEO made a big deal about them being a growth company. It seems crazy a huge and ancient firm like P&G trying to be growth, but that's what investors demand.

I am not sure which is better for employees.
 

UncleMark

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Just saying there was a time where IBM and P&G and the like were the gold standard because of solid returns. I do not know which is better.

I had buddies at P&G when their CEO made a big deal about them being a growth company. It seems crazy a huge and ancient firm like P&G trying to be growth, but that's what investors demand.

I am not sure which is better for employees.
Everything changed when the CEOs started getting paid based on stock prices rather than the company's overall performance.
 
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Stuffshot

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Yeah I haven't checked but I would guess you would have been better off in CDs :)

If I only had a crystal ball....... I could be filthy rich. :)
CDs are much better than cassettes! (Sorry)

You might hook up to a mutual fund screener and screen for "normal" mutual funds with an annual yield of > 5% (either monthly or quarterly payments). I bet you can find several that pay better than the banks' CDs.

Be cautious about buying into the LLPs related to energy or real estate that have goofy tax consequences. Sorry, can't describe them any better than that but there are still quite a few "normal" mutual funds that can beat the banks.
 

NPT

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CDs are much better than cassettes! (Sorry)

You might hook up to a mutual fund screener and screen for "normal" mutual funds with an annual yield of > 5% (either monthly or quarterly payments). I bet you can find several that pay better than the banks' CDs.

Be cautious about buying into the LLPs related to energy or real estate that have goofy tax consequences. Sorry, can't describe them any better than that but there are still quite a few "normal" mutual funds that can beat the banks.
Yeah but my reference was about what twenty02 said about the stock market return from 2000-2013 .... I was saying that I would have been better off with CDs if I had know it wasn't gonna return much.
 

TheOriginalHappyGoat

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Social Security couldn't have gotten off the ground as an actual vested retirement account without a huge injection of money from the very beginning. There would have been no money to pay the first recipients if the contributions were being socked away. Without that huge initial investment, the only way it could even exist was as a transfer scheme. The biggest problem was it was sold as a retirement program where benefits were tied to "contributions", when that really wasn't the case.
SS was always a wealth transfer scheme, moving money from the young to the old. Made sense when they came up with it, but like most things, the Boomers have f*cked it all up.
 

DANC

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SS was always a wealth transfer scheme, moving money from the young to the old. Made sense when they came up with it, but like most things, the Boomers have f*cked it all up.
How? By living longer? Or paying way more than their share of SS compared to their parents?

Once again, you've proven you don't know shit about economics or how the economy works.
 

Morrison

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SS was always a wealth transfer scheme, moving money from the young to the old. Made sense when they came up with it, but like most things, the Boomers have f*cked it all up.
I’m thinking me and UncleMark need to start a Boomer defense fund to get all you haters to get woke and be more understanding of our fu*k ups. 😊
 

TheOriginalHappyGoat

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How? By living longer? Or paying way more than their share of SS compared to their parents?

Once again, you've proven you don't know shit about economics or how the economy works.
And by being more numerous. And by combining this natural advantage with a plethora of other financial laws and regulations that treat their generation preferentially.
 

DANC

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And by being more numerous. And by combining this natural advantage with a plethora of other financial laws and regulations that treat their generation preferentially.
I don't think it was the Boomers' fault for being numerous. Who do you think is still paying into SS and financed their parents' SS?

Treated preferentially? Like the increase in full retirement age?

You need to stay in your lane.
 

TheOriginalHappyGoat

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I don't think it was the Boomers' fault for being numerous. Who do you think is still paying into SS and financed their parents' SS?

Treated preferentially? Like the increase in full retirement age?

You need to stay in your lane.
How about tax cuts that mostly help the Boomers while passing debt down to future generations?

Stay in my lane? My lane has already been mortgaged by the generation that came before me. I don't have a lane.
 

UncleMark

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And by being more numerous. And by combining this natural advantage with a plethora of other financial laws and regulations that treat their generation preferentially.
Actually it was the Greatest Generation who made Social Security (and Medicare) what it is today, back in the 70s and 80s when the unions started weakening, manufacturing started declining, and seniors began depending more on SS in their old age. That's when AARP became a force to reckon with. It was then that the notion of being able to live on SS became commonplace.
 
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TheOriginalHappyGoat

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Actually it was the Greatest Generation who made Social Security (and Medicare) what it is today, back in the 70s and 80s when the unions started weakening, manufacturing started declining, and seniors began depending more on SS in their old age. That's when AARP became a force to reckon with. It was then that the notion of being able to live on SS became commonplace.
Alright, so all sorts of different old people suck.
 
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UncleMark

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I’m thinking me and UncleMark need to start a Boomer defense fund to get all you haters to get woke and be more understanding of our fu*k ups. 😊
Aw, let the kids whine. As long as they keep working and paying FICA I'm willing to put up with a little sobbing. Their kids will be blaming THEM soon enough.
 

DANC

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How about tax cuts that mostly help the Boomers while passing debt down to future generations?

Stay in my lane? My lane has already been mortgaged by the generation that came before me. I don't have a lane.
LOL What a victim!

If you're worried about debt, don't listen to your President's plans to bankrupt the country.
 

UncleMark

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I've already got back and leg problems. When does crotchety start?
For me it was around 35.
Oh, I'm not worried about the debt. I've said that about a bazillion times. I'm just interested in blaming you old folks for being greedy and selfish.
Seriously, I don't think it's correct to make it a generational thing. People think in the short term, and even will be convinced that if they're getting theirs, then they can use some of that to make things better for their children and grandchildren, either directly or after they die. While old folks will take what they can get from the gubmunt, they don't want to count on the gubmunt to take care of their progeny. Cake and eat? Sure. But we're dealing with human nature here. It's not like the Boomers are intentionally raping the economy and telling their kids to fend for themselves.
 
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TheOriginalHappyGoat

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For me it was around 35.

Seriously, I don't think it's correct to make it a generational thing. People think in the short term, and even will be convinced that if they're getting theirs, then they can use some of that to make things better for their children and grandchildren, either directly or after they die. While old folks will take what they can get from the gubmunt, they don't want to count on the gubmunt to take care of their progeny. Cake and eat? Sure. But we're dealing with human nature here. It's not like the Boomers are intentionally raping the economy and telling their kids to fend for themselves.
It might not be generational at all. We might all be greedy and selfish. Actually, that seems likely.
 
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UncleMark

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It might not be generational at all. We might all be greedy and selfish. Actually, that seems likely.
My Uncle Pete used to say that all the world's problems could be boiled down to greed. It was an oversimplification, sure, and he was as hard core an anti-tax, anti-spend, anti-government Republican as you could ever hope to find, but he was right in many respects.
 

i'vegotwinners

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How about tax cuts that mostly help the Boomers while passing debt down to future generations?

Stay in my lane? My lane has already been mortgaged by the generation that came before me. I don't have a lane.


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only total idiots think in terms of "generations".

it's just another divide and conquer ploy.

all generations are the same, always have been, and always will be.

and all generations will traverse the different age groups before they leave.

that said, only a small part of any age group has real political power.
 
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NPT

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It might not be generational at all. We might all be greedy and selfish. Actually, that seems likely.
Why is it greedy to want SS when you've paid into it. I'll bet if you put money in a bank you expect it back. Would you be okay with letting the bank decide who to give the money back to and telling you "Sorry, we gave your money to person X since they needed it a lot worse than you did."?

Or did I misinterpret your meaning? :0 :)
 

VanPastorMan

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What is someone going to do with their money that is totally risk free? 2008 showed just sticking it in the bank. Jeremy Clarkson used some Swiss financial group that told him to move mass sums to AIG "advanced fund" for the richest of the rich because it was completely safe. Of course it wasn't.

Many workers may soon discover Social Security wasn't 100% safe.
Jesus said in Mathew 6: 19 “Do not lay up for yourselves treasures on earth, where moth and rust[a] destroy and where thieves break in and steal, 20 but lay up for yourselves treasures in heaven, where neither moth nor rust destroys and where thieves do not break in and steal. 21 For where your treasure is, there your heart will be also.
Someone once said none of us can take it (our money) with us when we die, but we can send it on ahead. Once we get to Heaven we find out that the most precious metal we have on Earth which is gold is something they use for asphalt up there.
 
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