How's everybody feel about SS?

[bldgengineer]

Scrap it? Give it a chance? Personally, at the age of 26 I know I will more than likely never see my money again. So I think I should at least be able to use the 400/month the way I see fit. At least give me the option....

How does everyone else feel?

 

[Webzter]

Would love to add that money to my own retirement account. However, many people aren't disciplined enough to save for their retirement (hint, they probably don't hang out here). So, we're going to go through some painful transition periods..

Next best option would be to let me self direct into a small choice of funds and let me watch it grow.

In addition to that, I'd like to see congress stop borrowing against the social security surplus.

I'm 29 and not planning on ss at all. In reality, though, if we haven't imploded as a country by then (and if we're not forced to restructure our debt, peak oil doesn't drive everyone out of business, bird flu doesn't kill everyone, we don't all drown when the ice caps melt, etc) then it'll likely exist in some fashion.

 

[bldgengineer]

Next best option would be to let me self direct into a small choice of funds and let me watch it grow.

In addition to that, I'd like to see congress stop borrowing against the social security surplus.

I agree with this as well. The people that aren't fiscally responsible enough to plan for their own retirement more than likely are one's who wouldn't read all the paperwork that goes along with getting their job. If there were a little check box asking if you would like to place your SS benefit money into a gov't ETF(??) most people would probably look past it.

And congress borrowing the citizens money is just plain wrong. They have their own pension plan so they decide to take what should rightfully ours. What would happen if we voted to borrow money from their pension?

 

[Martha]

Unless we bring back an agrarian society where you live with and take care of your elders or we have poor houses, we will need social security in one form or another.

There is no utopia where all young people learn to save for the future and the unseen hand guides us all to a fulfilling retirement.

 

[W2R]

I am 59 so I think I will probably get SS. However, I don't feel very secure about future cost of living increases, and without them inflation will make it worthless before too long.

If I was 29, and if I was able to give $15K to a 401K, I'd live like a pauper to do it. This higher investment limit is great and has only been available during the past few years, so that is something you have going for you.

Also, I'd prepare for higher income taxes because if/when SS is taken down, there are going to be a whole lot of destitute seniors on the dole and the money for that has to come from somewhere.

Back in the late 1960's and early 1970's there was a huge movement on campuses for ZPG (Zero Population Growth). The idea was that the world was overpopulated and it was each couple's duty to have no more than two kids, and hopefully none.

Had we baby boomers known that we needed more kids to support our social security, maybe instead of ZPG it would have been PPG for Positive Population Growth!! Oh well.

 

[Robert the Red]

Scrap it? Give it a chance? Personally, at the age of 26 I know I will more than likely never see my money again.

I recall quite clearly thinking this about 25 years ago, when the moaning about SS started seriously. I'm now 52, and the problems have receded into the future as fast as the future has turned into the present. I think it is highly likely you will get some SS payments (and of a meaningful amount) when you are aged and withered like I will be in 10 years or so.

Medical care -- that's a different story.

 

[RE-Fin-54321]

Not sure if this has been posted on the boards before, but it seems to fit with this topic:

The Nation's Growing Fiscal Imbalance: Perspectives and Issues with David Walker, Comptroller General of the United States
This is about an hour long presentation by the US Comptroller General (head of the GAO), David Walker, given at Cal Berkley in 2005. He discusses in detail issues surrounding social security, medicare/medicade, national debt, etc.

I saw Walker on 60 Minutes about a week ago and following the show, found the complete presentation linked above, so apparently he is still touring the country with his message.

If you find this type of thing interesting, I believe it is well worth the 60 minutes to watch.

 

[cute fuzzy bunny]

Ha...what was it...two days ago that I said "how long before the younger folks start grumbling about paying into social security for all those baby boomers, and their voting voice becomes louder?"

Thats the great part about this place. You dont have to wait long...

 

[maddythebeagle]

Why would you complain about a generational redistribution of wealth? The good thing is that the boomers wont live forever..... But hey, this is a FIRE board, and investment income isnt taxed for social security, yet....

All kidding aside, I have 1 parent that will have nothing more than SS and some family support...some people cant or wont save for themselves...I am not a liberal, but seems like sound philosophy...

 

[Ed_The_Gypsy]

I say, keep SS. I have no problem supporting a social safety net. Medicare needs reworking, though. (Having said that, I have no answers.)

I am not planning for SS, but expect that we will get at least 75% of what we are scheduled for. In truth, we will most likely get the full projected amount. I expect that we will be among the last to get what was promised, though.

 

[samclem]

I'd favor a hybrid system with workers contributing approx 7.65% of their pay to a means-tested safety net (survival-level welfare for the aged). The worker would contribute another 7.65% to his individual account in a choice of a few broad baskets of securities and bonds (broad enough that none of them would be be wiped out in a big downturn). Why 15.3% total? Because the employer-match would be eliminated (it is an accounting gimmick anyway, pay would rise to make up the difference as soon as it was eliminated).

(If eliminating the employer match is too much to swallow, then just have the employer 7.65% contribution go to the "alms for the poor account" and let the employee invest in his 7.65% in his personal account selection).

IRAs, 401Ks, etc would remain available just like today, and that's where people can do their fine-tuning/performance chasing.

The tough part of implementing this is getting the dough to pay the SS obligations for the folks who are already nearing 65. There would have to be a gradual phase-in of means testing by age, with a gradual ramp-down of the non-means-tested monthly checks for those who are younger today.

 

[bldgengineer]

I have no problem with paying into SS as long as it will still be around when I deserve to get it. Problem is 40 years from now when I can ask for it, it more than likely will be gone. I just don't see any reason to not have a choice when hired. "SS or a Gov't Target Fund" kinda like "Paper or plastic" and nobody can or ever will be allowed to touch it.

 

[samclem]

I have no problem with paying into SS as long as it will still be around when I deserve to get it. Problem is 40 years from now when I can ask for it, it more than likely will be gone. I just don't see any reason to not have a choice when hired. "SS or a Gov't Target Fund" kinda like "Paper or plastic" and nobody can or ever will be allowed to touch it.

There's one big problem with this: The system needs your contributions now to pay distributions to those who are retired. If workers could opt out, the date when income no longer matches outgo would come quicker and the delta would be bigger.

Also, as a society, we've made a commitment to not allow people to fail catastrophically. There's gonna be a safety net for seniors, and somebody needs to pay for it. If you opted out, you'd be shifting that burden to others.

Though I'm no fan of our present system, it does help to assure a stable social order that allows the economy and our political system to function more smoothly, and that is good for everyone. William Bernstein makes this case well in "God Bless This Ponzi Scheme".
http://http://www.efficientfrontier.com/ef/900/ss.htm

 

[Sue J]

Correct link to the article -
God Bless this Ponzi Scheme

 

[maddythebeagle]

I have no problem with paying into SS as long as it will still be around when I deserve to get it. Problem is 40 years from now when I can ask for it, it more than likely will be gone. I just don't see any reason to not have a choice when hired. "SS or a Gov't Target Fund" kinda like "Paper or plastic" and nobody can or ever will be allowed to touch it.

It is absurd to allow folks to "opt out"....what happens if you fail financially? Based on your other thread, you dont sound self sufficient http://www.early-retirement.org/forums/f30/sufficient-financial-goals-28661.html

And don’t say that you never will because **** happens….I much rather having most (there are some exemptions) paying into it and end up with some means testing if necessary rather than asshats not paying into it and ending up at the doorstep begging….

 

[NinjaPigeon]

I don't think it'll be around when I retire, as I am only 29. However, I am a dirty liberal (affectionate name given to me by my group of very republican, young professional peers). And so, I am happy to support the program and others like Medicaid and Medicare.

My only gripe is that our government robbed social security for years, and they constantly overspend. Such programs somehow become the low-hanging fruit of areas to trim instead of things like the bridge to nowhere in Alaska.

 

[Martha]

Those of you who think it won't be around when you retire, what do you think will happen to elderly without money or very little money? A good percentage of the elderly primarily live off of their social security.

 

[cute fuzzy bunny]

Probably a reversion to the way things used to be. Work until you cant, then live in a group home. Sad and pretty dang unpleasant way to go for old folks.

And I'd like to say that it'd be a message for those who still have time on the clock to save their pennies, but people are too short sighted.

 

[chinaco]

Probably a reversion to the way things used to be. Work until you cant, then live in a group home. Sad and pretty dang unpleasant way to go for old folks.

And I'd like to say that it'd be a message for those who still have time on the clock to save their pennies, but people are too short sighted.

Yup! Why don't we just move right on to being a third world country.

I believe SS is a baseline income safety net that is needed.

Bottom line: If the country had large numbers of destitute elderly people, there would be an outcry to start up a program to ensure that everyone had a small base level of subsistence income. Sound kinda like SS?

 

[cute fuzzy bunny]

Thats fine, we just need to readjust some spending to accomodate that. And by the way, i'm all for taking care of the people who helped make this a great country.

Unfortunately, we're a little behind in almost every other area. Will we be allowing crime to run rampant, our schools to suck even more, our highway infrastructure to decay further, or tax the living crud out of everyone who is still working until we remove that motivation?

 

[pj86]

I am 21 and also don't (won't) count on SS.

That's partly pride, but mostly pessimism.

 

[Webzter]

Those of you who think it won't be around when you retire, what do you think will happen to elderly without money or very little money? A good percentage of the elderly primarily live off of their social security.

I think the minumium age will be phased in to increase to 75. Possibly a phased withdrawl cap based on net worth. Or, we're going to be faced with higher taxes to cover the shortfall. Maybe all three or something entirely different.

Life expectancy in the 1930's was under 60 years old, I believe (or close to it). So, I would think that it was established with the idea that many wouldn't live long enough to collect and those that did would need it because they were no longer able to work.

With mortality tables now showing a life expectancy of 74 years, it just feels like something is going to have to give.

 

[Lancelot]

Those of you who think it won't be around when you retire, what do you think will happen to elderly without money or very little money? A good percentage of the elderly primarily live off of their social security.

I agree.

IMHO the end result of abruptly ending social security would be blood in the streets

Tweaking SS? Sure. Gradual privatization? Probably. Slow strangulation (30+ year phase out) Plausible...

For the life of me, I can't imagine millions of retired (and those nearing retirement) meekly saying "Oh goodness, no more monthly SS checks. But we don't mind, we'll just suck it up and do the best we can. After all, we never really counted on receiving SS anyway."

Yeah right...

 

[chinaco]

I think the minumium age will be phased in to increase to 75. Possibly a phased withdrawl cap based on net worth. Or, we're going to be faced with higher taxes to cover the shortfall. Maybe all three or something entirely different.

Life expectancy in the 1930's was under 60 years old, I believe (or close to it). So, I would think that it was established with the idea that many wouldn't live long enough to collect and those that did would need it because they were no longer able to work.

With mortality tables now showing a life expectancy of 74 years, it just feels like something is going to have to give.

SS also serve other purposes like disability income (SSI).

Continuing to raise the age much further has other implications. We have people that are living longer, but many will not be able to perform their work past a certain age. Many are unable to continue working due to health decline or just age related limitations for physical types of activity (i.e., lifting, manual labor). Imagine a woman in her 50's that has worked in a ware house, she decides to retire @ 62 or 65 because she has less physical capability. While working she made $35k/yr. Now she can no longer do that at say 63 because of age (just wearing down). She is not eligible for traditional disability (if SS is boosted to 74). All she can find is part-time work in a dept-store. Now she cannot earn enough to take care of basics. The part-time work + SS allows her to continue to afford the basics. Can you imagine a 69 year old roofer (not talking about the outlier)?

IMHO - Boosting the age only works to a degree. There is probably a ceiling that realistically can be attained today. We are living longer, but we are not always in a condition that enables us to continue our jobs (depending on what you do)... Plus, with age discrimination, more and more people are getting pushed out (It does happen more often that people think ). This is a very complex problem. If we do not watch it, we will be back in the 1800's with old people destitute and begging (not an exaggeration). I believe that SS or something like it is needed.

 

[Martha]

I think the minumium age will be phased in to increase to 75. Possibly a phased withdrawl cap based on net worth. Or, we're going to be faced with higher taxes to cover the shortfall. Maybe all three or something entirely different.

Life expectancy in the 1930's was under 60 years old, I believe (or close to it). So, I would think that it was established with the idea that many wouldn't live long enough to collect and those that did would need it because they were no longer able to work.

With mortality tables now showing a life expectancy of 74 years, it just feels like something is going to have to give.

Unfortunately, even though life expectancy has increased, most of the increase is from the early years. Less people die young. The increases in life expectancy for those reaching 60 has increased, but not substantially.

Chinaco has a lot of good points. A number of people retire just because they don't have the health to work in their job anymore.