Will Social Security be there?

[Badger]

Quote:

Originally Posted by GenXguy I would not be opposed to means testing of SS benefits resulting in cuts beginning for households with over $30,000 of "other" retirement income and phasing out completely at $50,000 of other income so that the most needy of seniors can get their full promised benefit.

Now that looks like a big can of worms


Cheers!

[Aerides]

Quote:

Originally Posted by pb4uski I would be opposed to that... that isn't what the deal was.. like chaning the rules of the game in the middle of the ninth inning.

This is the key I (think/believe/opine) - any changes will have some grandfathering and staging. In my lifetime, I do not see expect significant SS changes to impact those already on it, or about to go on it, with say, a <10year or at least <5 year window - ie, without a catch up window.

Even though I do expect more FRA slides, again, they usually keep the gate open for those that are close.

And means testing would be a massive complex overhaul to the system, as well as come with years of legal battles... so I'm putting my bets on that not happening.

[Rocky mtn high]

So Badger, you paid in your money for probably at least 30 years and you just want to give it away? Not me, that was my money they took for years from me and I want!

[Badger]

Quote:

Originally Posted by Rocky mtn high So Badger, you paid in your money for probably at least 30 years and you just want to give it away? Not me, that was my money they took for years from me and I want!

Good luck. I'm not sure which post you are referring to but I don't understand what you mean by giving it away. You do know that SS is not your personal savings account don't you? The money from those presently working is for those who are retired. When you get SS it will come from those younger than you who are working. So be nice to people who are working and contributing to SS. That is where your SS money is coming from when you qualify. I'm not giving anything away.



Cheers!

[LRDave]

Quote:

Originally Posted by Rocky mtn high So Badger, you paid in your money for probably at least 30 years and you just want to give it away? Not me, that was my money they took for years from me and I want!

Sorry - that's not the way SS works.....

[teejayevans]

Quote:

Originally Posted by LRDave Sorry - that's not the way SS works.....

Technically not, but I would bet a great majority thinks that is how it works, and they are going to be screaming if you try to cut what they said we would be getting. The politicians that support that will get fried by the 3rd rail.

[Badger]

FYI This was copied directly from SSA.gov . I hope this helps Rocky mtn high. He may be confused.



"The current Social Security system works like this: when you work, you pay taxes into Social Security. We use the tax money to pay benefits to:• People who have already retired.• People who are disabled.• Survivors of workers who have died.• Dependents of beneficiaries.The money you pay in taxes isn’t held in a personal account for you to use when you get benefits. We use your taxes to pay people who are getting benefits right now. Any unused money goes to the Social Security trust funds, not a personal account with your name on it."


Cheers!

[Out-to-Lunch]

I think is was said better by the inimitable Dave Barry:

Quote:

First, we need to clear up a misconception. Many Americans believe that Social Security works this way: The government takes money out of your paycheck, keeps it for you in a safe place such as a giant federal mattress, then, when you retire, starts giving it back to you. If that's how you think it works, then let me quote the famous French economist Francois Quesnay (1694-1774): ''Ding dong, you're wrong.'' What actually happens is, the government takes money out of your paycheck and immediately gives it to a retired person (in your particular case, this person is Mrs. Edwina P. Loogersnapper of Yeasting Springs, Vt.; she says ''hi''). This system works fine as long as there are enough younger people working to support the retired people.

(I always loved the "She says 'hi'" line!)

[Rocky mtn high]

I know that is not the way it works but they took our money with the promise of giving money back to us 30 years later. They should not be allowed to break that promise!

[Rianne]

Quote:

Originally Posted by Rocky mtn high I know that is not the way it works but they took our money with the promise of giving money back to us 30 years later. They should not be allowed to break that promise!

I guess they feel they can adjust that promise to fit today's needs. Kind of like wedding vows. I think I've stuck to my promise to my DH. Oh, wait, that "honor and obey" part. Then, "through good times and bad" Hmmmm, for the most part. There were a few heated discussions along the way. Then "until death due us part." Well, so far, that promise is still there.

[Rocky mtn high]

Just like how they ADJUSTED how much they tax your SSI, just like how they ADJUSTED IRA rules, just like they ADJUSTED RMD. it goes on and on. Our government is bankrupt and everyone just seems to make excuses for them.

[pb4uski]

Quote:

Originally Posted by Rocky mtn high I know that is not the way it works but they took our money with the promise of giving money back to us 30 years later. They should not be allowed to break that promise!

I agree... a deal is a deal. Now if/when the SS Trust Fund is depleted and tax revenue only allow x% of benefits to be paid, then benefit should be reduced across the board. Absent any intervention from Congress that is what will happen.... that ws the deal.

[MrsHaloFIRE]

Quote:

Originally Posted by GenXguy I would not be opposed to means testing of SS benefits resulting in cuts beginning for households with over $30,000 of "other" retirement income and phasing out completely at $50,000 of other income so that the most needy of seniors can get their full promised benefit.

I'm most definitely opposed to that. Imagine buying a life insurance policy and paying for it monthly for 30 yrars, and then when you pop clogs the insurance company tells your heirs sorry. Too bad. You had too much in your checking account when you died. Uncool. Very uncool. Refund my paid in Soc Sec taxes and we can discuss.

[Out-to-Lunch]

Quote:

Originally Posted by Rocky mtn high I know that is not the way it works but they took our money with the promise of giving money back to us 30 years later. They should not be allowed to break that promise!

I totally agree. The social contract is and was important. Some tweaks may be (read "are") necessary, but the spirit should remain intact.

[GenXguy]

Quote:

Originally Posted by MrsHaloFIRE I'm most definitely opposed to that. Imagine buying a life insurance policy and paying for it monthly for 30 yrars, and then when you pop clogs the insurance company tells your heirs sorry. Too bad. You had too much in your checking account when you died. Uncool. Very uncool. Refund my paid in Soc Sec taxes and we can discuss.

With SS, you're not making a choice to buy a product. You're not making bets. You're not investing. And you're not playing a game (there's no 9th inning silliness). The government has already made various changes to SS over the years - higher FICA tax, raised the retirement age, taxing benefits, added an 80% taxation threshold, changed how spousal benefits are handled. So a means test for handling benefits fits in with these changes nicely, so people that don't really need SS will see a cut in their benefit or have it completely eliminated, while more needy seniors can see increases to their benefits. I hate to see struggling poor seniors and am willing to make this sacrifice myself. It seems only fair.

[GenXguy]

Quote:

Originally Posted by Chuckanut It’s more likely they will change it by making the benefits more taxable. The benefit remains the same, but the higher the overall income, the more that is taxed away.

This is already happening. A greater percentage of SS benefits are taxed every year because the taxation thresholds are not indexed to inflation while the benefits are increased. However, they could still steepen the curve, tax 100% of SS benefits for people with over $30,000 of "other" income, for example. That would probably be a good idea, but I think it should be indexed to inflation after correcting the previous policy errors by adjusting the original thresholds to inflation.

[explanade]

You think there would be greater public support for taxing benefits or lifting the income cap used to calculate the social security taxes?

[MissMolly]

What would stop people over the threshold from pulling enough of their invested assets out and putting them in something not reportable/trackable as income (say under the mattress, or maybe in Bitcoin, although I have no idea how Bitcoin works, or whatever) so they can still get the SS payments they had planned on?

I think means testing would be a huge disincentive to save for retirement only to be penalized once you reach it. While some scrimp and save all their lives to have a healthy nest egg, others have frittered it away on a high lifestyle. It seems they would be getting rewarded for not saving.

[youbet]

Quote:

Originally Posted by MrsHaloFIRE I'm most definitely opposed to that. Imagine buying a life insurance policy and paying for it monthly for 30 yrars, and then when you pop clogs the insurance company tells your heirs sorry. Too bad. You had too much in your checking account when you died. Uncool. Very uncool. Refund my paid in Soc Sec taxes and we can discuss.

I think you misunderstand how SS works. That is, what the "deal" is.

You paid SS taxes over the years and those dollars were spent to pay benefits to those collecting SS. Paying them their benefits was what you got for your tax dollars. When you apply for SS, you'll be paid dollars tax payers contribute at that time. Paying you is what they get for their tax dollars.

You're owed nothing other than what current (at the time) SS laws dictate (likely constrained by how much the then current SS taxpayers can/want to contribute).

Personally, I don't like these kind of ponzi schemes and think the politicians that created them are given far too much credit. But that's the way it is.

My own feelings are that any mix of fixes to bring the system into balance (tax in = payments out) is OK with me EXCEPT that I believe working folks should NOT pay higher FICA taxes if SS is not means tested. It just makes no sense that some poor stiff making minimum wage should see her FICA tax rate increase so that Bill Gates and Warren Buffet can receive full SS benefits. That's just too regressive for (generally conservative) me.

[youbet]

Quote:

Originally Posted by MissMolly What would stop people over the threshold from pulling enough of their invested assets out and putting them in something not reportable/trackable as income (say under the mattress, or maybe in Bitcoin, although I have no idea how Bitcoin works, or whatever) so they can still get the SS payments they had planned on? I think means testing would be a huge disincentive to save for retirement only to be penalized once you reach it. While some scrimp and save all their lives to have a healthy nest egg, others have frittered it away on a high lifestyle. It seems they would be getting rewarded for not saving.

You do realize that we already means test in many areas, right? Progressive income tax rates, for example. Folks who saved for retirement generally pay income taxes at higher marginal rates than folks who didn't. That's a disincentive to save for retirement, but we do it just the same.

As far as your fear that folks might hide/manipulate income to avoid SS means testing, isn't that the popular thing to do for obtaining ACA subsidies? Are you also for eliminating the means testing involved in doling out those dollars?