You might be right. But the idea of 401ks was probably particularly alien.
It needs updated for our current world. There's no doubt in that.
Let's talk policy . . .
- Thread starter Sope Creek
- Start date
It needs updated for our current world. There's no doubt in that.
I think SS is indeed a Ponzi scheme. SS depends upon current income to pay obligations. My. Yours, and all SS payments are on a cash basis. I have no designated account per se. I simply have a government promise to pay a given amount. I don’t think this a fraud. But millions of people see SS as something other than what it is. Paying into the “system” is a misnomer. There really is no system other than a legislative tax and spend arrangement.
Because there is no income qualified SS retirement benefit, I don’t think it’s fair to call it wealth transfer. However, making it a wealth transfer system has been proposed as a fix.
SS is to be contrasted with a private pension or annuity where there really is a fund set aside to pay obligations.
I thought that some in the Clinton admn. wanted to do this in some form and the pubs said no and then some in the Bush admn. wanted to do it and the dems said no way back when.
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DANC, the way Social Security is structured is an open book. This includes the forecast of a shortfall in 2035. The structure and shortfall are there for anyone to explore.
Furthermore the SS administration knows how much you and your employer have contributed to your account so that your monthly income from the program can be calculated at the time you decide to retire upon becoming eligible. Again the structure, and how much each ultimate payment is calculated is known for anyone willing to find out.
DANC, one thing we can probably agree on is all too many of us don't save and invest enough over our working years. Also all too many don't take the time to learn how their retirement SS benefit is calculated.
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What part of the fix didn't you like. I don't remember all that changed and haven't looked into it much.
Yeah that is why I suggested reworking Medicare to cover more of the "truly disabled".
You could also monkey around with the OASDI percentages as well. Even 8 to 10% of your income invested over a working lifetime should be a nice chunk of change.
Back in the day when self employed, 16% of my taxable income went into Medicare and Social Security. Needless to say, these contributions along with income taxes were incentives to finding ways to hide taxable income.
Surprise, surprise... IRS audits sometimes resulted in paying more income taxes and contributions to Medicare and Social Security.
Given these experiences, cannot help but think the Social Security surplus being under funded in 2035 will be helped by the recent program to increase funding to the IRS. Say this as more funding to the IRS should result in more agents doing audits.
Surprise, surprise... IRS audits sometimes resulted in paying more income taxes and contributions to Medicare and Social Security.
Given these experiences, cannot help but think the Social Security surplus being under funded in 2035 will be helped by the recent program to increase funding to the IRS. Say this as more funding to the IRS should result in more agents doing audits.
My very vague memory is that Carter took some steps to shore up SS, but perhaps he didn't get a chance before Reagan took over. Somewhere in there was when they set up the gradually increasing age for full retirement, but of course they set up the start of that for in the future. I don't think it started kicking in until the 00s.
Wasn't the excess SS funds always invested in government bonds so in reality SS was always lending the government money? Was the change more an accounting change than anything else? I'm asking because I'm not up to date on all that stuff.
Based on what?
IMO if you consider means testing it should be based on the income you've earned throughout the years and not what you have when you apply. Otherwise, a person could earn 20 million a year for several years and blow it all and that person would get it while another person who earned $60,000/year for their career but saved and sacrificed but now has a million dollars wouldn't get it.
Isn't the only reason SS is broke, is because DC acted like Bernie Maddoff?
I know this is supper elementary level, but didn't DC break this to start with?
No. Bad idea.
You would know -- isn't it already taxed as normal income? If not, it should be. Otherwise, it should fall into the "promise made, promise kept" category.
That's what it is already. It's an income transfer from the younger, working population to the older, retired population.
JBS will complain about Boomers having it easy, and cite the expansion of the IRS enforcement as a reason.
No that's completely incorrect. It's solely because when SS was created there were 42 workers for every beneficiary. Now there are 3 workers/beneficiary...in another decade it'll be 2:1.
DC has been slow to adjust the tax/ benefit formula as it's incredibly unpopular politically.
It's a book many don't choose to read.
Yes, if we all saved enough during our working years, there would be no need for SS.
Problem is it's too late unless the govt is going to pay us reparations. Pretty sure I have paid in more SS being self employed than taxes . That money isn't there for me to go back and save.
Bingo! In addition to that people are living a lot longer than they did when SS was created. Of course that is part of the reason it's 3:1 today. That and they've expanded who gets SS.
And that is the reason I'll always be against means testing in that form. It penalizes the people who were responsible and planned for their future.
Medicare premiums are configured to favor the people who make a lot of money. By that I mean the premium goes up as income goes up but only to a certain income ($750,000 I believe) so a person making 10 million a year pays the same premium as a person making $750,000 but a person making $250,000 pays a lot more than a person making $100,000.
