Wait to Age 70 to Collect SS?

[nwsteve]

Greenspan's remarks from yesterday may provide some insight for all our future planning.* The following excerpt is from his testimony to Joint Economic Committtee of Congress
We owe it to those who will retire over the next couple of decades to promise only what the government can deliver. The present policy path makes current promises, at least in real terms, highly conjectural. If fewer resources will be available per retiree than promised under current law, those in their later working years need sufficient time to adjust their work and retirement decisions.

Does not look to me like he has a lot of confidence the bucks are there for the current promised payouts.* Time to adjust the FIRE calculations??
nwsteve

[SteveR]

Quote:

Originally Posted by nwsteve Greenspan's remarks from yesterday may provide some insight for all our future planning.* The following excerpt is from his testimony to Joint Economic Committtee of Congress We owe it to those who will retire over the next couple of decades to promise only what the government can deliver. The present policy path makes current promises, at least in real terms, highly conjectural. If fewer resources will be available per retiree than promised under current law, those in their later working years need sufficient time to adjust their work and retirement decisions.

I just love Greenspan speak....it is like its own unique language. Translated:

The current working stiffs need to belly up and give more to SS so those retiring in the next 20 years will have at least something to live on.

The current system is broken and we cannot say you will get any $$ when you retire.

You have been warned! Save your money now because SS won't be there to bail your butt out later on.

[thefed]

lol! i JUST WENT TO THE SS.gov WEBSITE, AND USED A CALCULATOR TO PREDICT MY RETIREMENT BENEFITS.

Just for the heck of it, i put my current wages at 20k, and increasing 2%/yr. I'm 22.

When 67 I'd be collecting $56k/yr (2050's dollars) at this rate!
That's a lot of $$$, regardless of inflation, especially with the wage i entered. Especially if you dont have a mortgage.

Someone making 30k would collect 72k in 45 years.

I make about 35k now and that'd net me 78,000/yr in 2050

Another translation: take the money at 62.

Quote:

Originally Posted by nwsteve Greenspan's remarks from yesterday may provide some insight for all our future planning.*

Greenspan is a shameless shyster.* This is the same guy who was just yesterday extolling the virtues of variable-rate mortgages, knowing full well that intertest rates were headed up.

There is no problem with social security that can't be readily solved.* The problem is Medicare, which none of our present "leaders" cares to comment on.* According to the US Comptroller General, the unfunded liability for SS is about $5 trillion.* The unfunded liability for Medicare is about $30 trillion, including about $8 trillion for the unfortunate new prescription-drug benefit.

HH

[SteveR]

Nothing is underfunded. The funds for these programs are from taxes; SS tax or Medicare tax. All they have to do is raise them.

Once the politicians convince us of the need; taxes will be increased while they tell us it will only be for a "little while."

Part D of Medicare will cost us a lot more than what was originally believed (as always :). Those still working will have the joy of seeing this tax increase in the coming years. Also, eventually, SS will be taxed on all income without an upper income limit as it has today. That is an easy one because it affects only the "wealthy" and is an easy sell.

[MasterBlaster]

SteveR:

The tax-only solution to medicare and SS is not likely to be implemented.

I think you need to do a little more research as the amounts are so staggering.

The intro to Ben Steins Book gives some good insight into how large the problem is.

Here is a link to it from Amazon:

http://www.amazon.com/gp/reader/1401...51#reader-page


remember that the SS "trust fund" has been spent. It really isn't available to pay anybody. So any analysis you see where the "trust fund" is used to show the problem isn't so bad are disingenuous.

[thefed]

A qoute I found:

Social Security faces an $11 trillion shortfall if nothing is done to fix the current system. But they fail to mention that this is over the course of the “infinite future." Over the next 75 years -- still practically a lifetime -- the shortfall is projected to be $3.7 trillion.

[MasterBlaster]

Here's another quote (from Ben Steins' book):

"Add in Medicare expenditures (to SS), and far from having a surplus, you're already devoting 3.6 percent of personal and corporate tax revenues to meet the shortfall from social security and Medicare taxes today. By 2030 this shortfall will require 52.7 percent of general tax revenues, and by 2070 they'll need 100 percent, according to the National Center for Policy Analysis."

Stein Pegs the present value of the SS shortfall at 10.4 $trillion and 62 $trillion for the Medicare shortfall.

Clearly our current system is not sustainable and changes in benefits are inevitable.

[thefed]

Quote:

Originally Posted by MasterBlaster Here's another quote (from Ben Steins' book): "Add in Medicare expenditures (to SS), and far from having a surplus, you're already devoting 3.6 percent of personal and corporate tax revenues to meet the shortfall from social security and Medicare taxes today. By 2030 this shortfall will require 52.7 percent of general tax revenues, and by 2070 they'll need 100 percent, according to the National Center for Policy Analysis." Stein Pegs the present value of the SS shortfall at 10.4 $trillion and 62 $trillion for the Medicare shortfall. Clearly our current system is not sustainable and changes in benefits are inevitable.

that's disheartening!

Does anyone think the USA will ever ABOLISH SS, due to a lack of funds? imagine the ramifications if it's done away with....

[MasterBlaster]

Oh SS and Medicare will be around. They just won't be nearly as generous as they have been.

Quote:

Originally Posted by thefed that's disheartening! Does anyone think the USA will ever ABOLISH SS, due to a lack of funds? imagine the ramifications if it's done away with....

No -- SS is not the problem. Medicare is the problem. Medicaid is the problem. Pharmaceuticals are the problem. Healthcare in general is the problem. SS is not the problem!

HH

[SteveR]

Quote:

Originally Posted by MasterBlaster Here's another quote (from Ben Steins' book): "Add in Medicare expenditures (to SS), and far from having a surplus, you're already devoting 3.6 percent of personal and corporate tax revenues to meet the shortfall from social security and Medicare taxes today. By 2030 this shortfall will require 52.7 percent of general tax revenues, and by 2070 they'll need 100 percent, according to the National Center for Policy Analysis." Stein Pegs the present value of the SS shortfall at 10.4 $trillion and 62 $trillion for the Medicare shortfall. Clearly our current system is not sustainable and changes in benefits are inevitable.

I guess I just have a hard time with this assessment. *It appears to be yet another example of "creative accounting" by a couple of guys that want to sell a book. *I would have to see the basis for his calcuations before I buy into them. *

Raising taxes was one of the ways even Ben says will help to resolve the issue. *I also believe that there will be some reduction or elimination of benefits at certain income thresholds and perhaps even a tax on non-wage income someday. *Which is already there with certain non-wage income like stock options. *

Far smarter people than I will figure this all out someday. *I don't pretend to know the answer...I only stated that the government will never truly run out of money as long as they can levy taxes. *

I choose to take his doom and gloom assessment with several grains of salt.

Also *. . . the projections that show SS to be underfunded are disingenuous spin -- they are based on an assumed growth rate for the US economy that is way below the historical average. *If GDP grows at its historical rate, SS is solvent literally (well . . . figuratively) forever, without any changes.

HH

[MasterBlaster]

Quote:

the projections that show SS to be underfunded are disingenuous spin

These type analysis usually include the SS trust fund. Take that out and - "Houston weve got a problem"

Still maybe I am overly concerned.

- Party on Garth

Quote:

Originally Posted by MasterBlaster These type analysis usually include the SS trust fund. Take that out and - "Houston weve got a problem" Still maybe I am overly concerned. - Party on Garth

There is so much spin from our "leaders" on this. You can hear it -- "just promises on pieces of paper in a file cabinet." Stinking shysters! What, then, is any bond, except a promise on a piece of paper? Worry not. As other posters have pointed out, these promises are backed by the power to tax.

HH

[MasterBlaster]

Well I'd really like to believe that I can count on SS.

Trust funds, bonds, and taxation aside, just think about 4 workers now for every retiree. That changes to 2 workers to every retiree in the not-so-distant future.

What I fear is that taxes will have to go so high that the economy crumbles and the Government take comes out even less or less than they need.

[eric1821]

nobody can really tell how long can he lives. My Fidelity agent likes to tell me I can live up to 92, I don't even think I want to live that long. So I will get my SS when I am 62 which is only 1 years and 5 months to go.

Quote:

Originally Posted by MasterBlaster Trust funds, bonds, and taxation aside, just think about 4 workers now for every retiree. That changes to 2 workers to every retiree in the not-so-distant future.

Productivity gains -- we're not a manual-labor economy any longer. Four workers with N machines become two workers with M machines -- the net of the relationship is determined by the values of M and N, not by the two and the four.

HH (who thinks that M >> N)

[Michael]

They may just inflate the deficit away, and alter the CPI calculation so that SS benefits don't actually buy much, even though the numbers are getting bigger. Of course, anyone who has money in bonds or a savings account will get inflated away also. This has been the US government's traditional method of dealing with debt. They pretend to pay what they promised, but don't really do so.