Social Security: a positive note for Gen X/Y

[innova]

Quote:
Originally Posted by FinanceDude
I thought student loan debt fell on the surviving spouse.....however it has been a LONG time since I had student loan debt........

That would be a pretty draconian law to impose student loan debt of one spouse unilaterally onto the other spouse in the event of death of one spouse. I don't think that is the state of current law.

The only way this can happen is if you make the tremendous mistake of co-signing your spouse's student loan debt or vice versa.

Otherwise, death gets you off the hook without sticking it to your spouse.

 

[ziggy29]

The only way this can happen is if you make the tremendous mistake of co-signing your spouse's student loan debt or vice versa.

Otherwise, death gets you off the hook without sticking it to your spouse.

Sometimes you wonder what people were thinking, or what bad advice they received, when they make a financial move like this.

Another common bad move is for an elderly parent to put their children on title to their home before they die. Not only does that add liability concerns for the child should someone get hurt on the property, but it also eliminates the step-up in basis the child would receive on the property when the parent dies and the child inherits it. If the child turned around and sold it immediately upon their parent's death, this results in a lot of capital gains taxes that would have been avoided if they received the step up in basis.

I hope these aren't financial planners or advisors who instruct people to do things like this. In the general case, it's financial malpractice.

 

[FinanceDude]

Sometimes you wonder what people were thinking, or what bad advice they received, when they make a financial move like this.

Another common bad move is for an elderly parent to put their children on title to their home before they die. Not only does that add liability concerns for the child should someone get hurt on the property, but it also eliminates the step-up in basis the child would receive on the property when the parent dies and the child inherits it. If the child turned around and sold it immediately upon their parent's death, this results in a lot of capital gains taxes that would have been avoided if they received the step up in basis.

I hope these aren't financial planners or advisors who instruct people to do things like this. In the general case, it's financial malpractice.

It is done all the time, but in every case I have seen, it is either the parent or child who has pushed for it.................

 

[armor99]

And that's where the generational warfare comes into play. The bottom line is that AARP and others block anything that makes today's seniors -- even the wealthiest ones who paid 2% of income into it for years and who get back several times what they put in, inflation-adjusted -- share in even a shred of the sacrifice.

Means testing on whom? No doubt it will exempt people already collecting and possibly those close to collecting. Higher taxes on whom? Certainly not those who are already receiving it (who paid MUCH lower payroll taxes than today's 6.2%/12.4% for many years). The bottom line is that pretty much everyone knows the "fix" (which the 1983 tax hi...err, "fix" was supposed to make unnecessary for at least 75 years) will screw the young almost exclusively.

That's why the funding mechanism is so odious. As soon as demographic trends go south in the worker-per-retiree ratio, the Ponzi scheme is in trouble. And no one in the AARP crowd will accept any "fix" which makes them share pain along side their grandkids. That's one of the main reasons why I hold AARP in such dripping contempt.

I agree that this is at the crux of the problem. You can bet your last dollar that those who praise SS will change their tune with frightening quickness once they learn that they might have their benefits cut to help "others" get their SS share in the years ahead. The philosophy of most people seems to be... "well as long as I get mine (from someone else of course), what do I care if you get yours?" Whereas my philosophy is more along the lines of "I take from no one, and expect none to take from me."

 

[Rustic23]

Megacorp,
According to the article, the Galveston County workers get more than they were working! As close as I can tell, Galveston employees paid in the same amount as SS, however, the County invested the money rather than spending it and promising the employee a set benefit.

 

[megacorp-firee]

Megacorp,
According to the article, the Galveston County workers get more than they were working! As close as I can tell, Galveston employees paid in the same amount as SS, however, the County invested the money rather than spending it and promising the employee a set benefit.

wow, a guvmnt entity that actually did something the right way? Makes me want to move to Galveston county.

... I wonder why isn't everyone lobbying their representatives to change SS to this type of a system? Seems like I would like that a lot more then SS.

 

[getrichslow]

Consider the next 30 years of SSI a charitable contribution from Gen X/Y to the Boomers. They outnumber everyone and it appears they will protect their benefits no matter the cost to the rest of us. I agree with the post that said ignore SSI and build your own retirement. If you are under 40 and reading this board you are smart enough to not need SSI.

 

[Rustic23]

Congress closed the loophole that allows local governments to opt out of SS

 

[Kronk]

Consider the next 30 years of SSI a charitable contribution from Gen X/Y to the Boomers. They outnumber everyone and it appears they will protect their benefits no matter the cost to the rest of us. I agree with the post that said ignore SSI and build your own retirement. If you are under 40 and reading this board you are smart enough to not need SSI.

Yeah, but you're also potentially spending an extra five years working in order to build up an additional half million in retirement savings in order to generate the income SS would instead provide.

Of course, that's not entirely accurate for early retirees, since we'll need more money to get to SS age anyway, but the principal of working longer than you need to remains.

 

[megacorp-firee]

Congress closed the loophole that allows local governments to opt out of SS

... knew there had to be a reason. oh well ... and I was just looking up real estate in Galveston too.

 

[youbet]

Congress closed the loophole that allows local governments to opt out of SS

DW works for a gov agency (school dist) today where she does not contribute to SS.

Perhaps the closing of the loophole you're refering to means that governments who aren't already opt'd out can't do so now?

 

[ziggy29]

DW works for a gov agency (school dist) today where she does not contribute to SS.

Perhaps the closing of the loophole you're refering to means that governments who aren't already opt'd out can't do so now?

Yes, that's correct. When the opt-out provision was closed, those agencies which already opted out were grandfathered and allowed to continue to opt out. But no new additional entities could opt out.

 

[jnojr]

In my view SS is a necessity. Fortunately, it prepares for those who otherwise would not have anything. Even though it may be their fault for not preparing...

Before Socialist inSecurity, everyone knew they had to save and prepare for their own retirements. After, we have millions and millions of people who choose not to save... why should they, when Big Brother is going to be there to catch them and care for them? Same with welfare... it started as an idea of temporary assistance to people who were in between jobs, and today is a multigenerational way of life for millions.

Socialism is a complete, total, and abject failure. It's a parasite that is eating more and more of the host it lives on, and will continue to do so until that host dies. I can only hope that when the inevitable does happen, it's A) when I'm young enough to fight my way through, B) after I'm gone, and C) that the lessons learned will carry on into the future, so that nobody else is ever stupid enough to believe in that nonsensical claptrap.

 

[armor99]

Before Socialist inSecurity, everyone knew they had to save and prepare for their own retirements. After, we have millions and millions of people who choose not to save... why should they, when Big Brother is going to be there to catch them and care for them? Same with welfare... it started as an idea of temporary assistance to people who were in between jobs, and today is a multigenerational way of life for millions.

Socialism is a complete, total, and abject failure. It's a parasite that is eating more and more of the host it lives on, and will continue to do so until that host dies. I can only hope that when the inevitable does happen, it's A) when I'm young enough to fight my way through, B) after I'm gone, and C) that the lessons learned will carry on into the future, so that nobody else is ever stupid enough to believe in that nonsensical claptrap.

Truer words have never been spoken.... your post made my day! jnojr for president '08!!!!

 

[igsoy]

Socialism is a complete, total, and abject failure. It's a parasite that is eating more and more of the host it lives on, and will continue to do so until that host dies. I can only hope that when the inevitable does happen, it's A) when I'm young enough to fight my way through, B) after I'm gone, and C) that the lessons learned will carry on into the future, so that nobody else is ever stupid enough to believe in that nonsensical claptrap.

someone should tell those unlucky Swedes, Danes, and Norwegians to quit it with all the happiness, already, and realize that they are really abject failures...

 

[Lusitan]

Well, I didn't want to start another debate about SS, but I guess it is (understandably) inevitable given the problems with the current system. In any case, my main point is that us younger workers won't receive full benefits from SS, but at least many of us are receiving one benefit already: the "life insurance" benefit. That's no small thing.

And of course, it's a benefit that we all hope we won't ever need to use, but having there as part of the plan to care for your loved ones is still a benefit, even if you never receive a penny.