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Cappy
Excelent
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Joined: 16 May 2002
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 Posted: 10/23/04 - 11:46 Post subject: Fixing Social Security
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AlaninTX
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Posted: 10/23/04 - 14:53 Post subject:
They want you to subscribe, Cappy. Summary?
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Cappy
Excelent
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Posted: 10/23/04 - 15:36 Post subject:
| AlaninTX wrote: | | They want you to subscribe, Cappy. Summary? |
Sorry about that, here are some highlight
This is from the 01 November 2004 Issue of Fortune Magazine
| Quote: |
The idea starts with the creation of Early Retirement Accounts. Individuals could put one-sixth of the money they and their employers currently pay to Social Security into 401(k)-like accounts, which they could use to finance retirement beginning at age 62. How would Social Security make up for the loss of revenue? Monthly Social Security benefits would remain what they are today, but the age at which future retirees qualified for them would be delayed. Today you can qualify for early, reduced benefits at age 62; that age would gradually increase to 68. The retirement age for full benefits would be pushed back from 65 to 72. Preliminary analysis by the SSA indicates that the rollback in retirement ages would not only save enough money to fund the Early Retirement Accounts, but also return the system to solvency
Most privatization plans stipulate that individuals take a 33% cut in their regular benefits and use personal accounts to make up (or exceed) the difference. That provision raises two big objections: What happens if the market tanks as you retire? And what happens if you live to be 115? Either way, you may end up eating dog food. (By contrast, today's system insures individuals not only against market losses but also against the risk of outliving their savings.) Some plans try to overcome market risk by promising a minimal return on personal accounts. But if there is a prolonged bear market, bailing out a whole generation of disappointed savers could easily become more expensive than the current system
Because of Social Security's long-term insolvency, taxes will be raised and benefits cut, one way or another. This plan preserves a valuable government-issued insurance policy against advanced old age—the program's original purpose. But it also allows people who want to retire early a good chance (though not a guarantee) of being able to do so. Given polls showing that more young people believe in UFOs than believe they will ever collect Social Security, that's not a bad political bargain.
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megawill
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Posted: 10/23/04 - 16:04 Post subject:
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Cappy
Excelent
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Posted: 10/23/04 - 16:06 Post subject:
I raised the age to 70 and reduced the COLA by ˝ %
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Pug
The Movie Geek
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Posted: 10/25/04 - 10:18 Post subject:
Raised Age to 67, and reduced benefits for those over $45,000 per year of retirement.
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jrjo
Gone Fishin
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Joined: 15 May 2002
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Location: Lake Wobegon, MN
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Posted: 10/25/04 - 10:33 Post subject:
Just get rid of the cap on SS taxable wages! Instead of stopping at $87,900, make every wage dollar taxable. I dunno why this gets such taboo treatment. It would solve the 'problem' instantly!!!!
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elkid
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Posted: 10/25/04 - 11:08 Post subject:
1) Treating SS like a 401K or an IRA will kill it. The volatile stock market will see that that.
2) I agree with jrjo - make every wage dollar earned SS tax eligible.
3) This is a pointless debate for those in my age bracket. There won't BE social security when we become eligible.
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jrjo
Gone Fishin
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Posted: 10/25/04 - 11:17 Post subject:
| elkid wrote: | | 3) This is a pointless debate for those in my age bracket. There won't BE social security when we become eligible. |
I dunno.. I'm age 30-sumthin too and if that stinkin' program isn't around after all the money I've been forced to sink in to it, I'll be one cranky customer. Now that SS sends out statements every year, it even gets me grumpier about the possibility of it gacking. There's a whole lot of my money that I'd dang better get back or believe you me, whoever is the Wobegon congressperson when I turn 65 will have me barking in their ear nonstop.
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elkid
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Posted: 10/25/04 - 11:44 Post subject:
| jrjo wrote: | | I dunno.. I'm age 30-sumthin too and if that stinkin' program isn't around after all the money I've been forced to sink in to it, I'll be one cranky customer. Now that SS sends out statements every year, it even gets me grumpier about the possibility of it gacking. There's a whole lot of my money that I'd dang better get back or believe you me, whoever is the Wobegon congressperson when I turn 65 will have me barking in their ear nonstop. |
I agree. Watch for a mutiny. Though remember it's there so that we can support the generations that preceded us. Generations that had a lot of kids who themselves did not. The payor source is shrinking, but the payee pool is growing. Simple economics tells us it's going to go dry.
Here's a question: what if SS was only available to American citizens?
Here's another question: what if price indexing were used as the basis of eligibility instead of wage indexing?
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sonnylax
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Posted: 10/25/04 - 14:30 Post subject:
I wish I could keep my money out of the SS system. I would be willing to forgo everything I've put into the SS now, if I didn't have to pay any more into that system.
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genie
Master of Prissface
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Location: Finding serenity one day at a time
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Posted: 10/25/04 - 22:15 Post subject:
| sonnylax wrote: | | I wish I could keep my money out of the SS system. I would be willing to forgo everything I've put into the SS now, if I didn't have to pay any more into that system. |
To me it's just another form of welfare where someone else benefits from my hard work yet I don't. That's crap. 
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RexRacer
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Posted: 10/26/04 - 08:52 Post subject:
| jrjo wrote: | | Just get rid of the cap on SS taxable wages! Instead of stopping at $87,900, make every wage dollar taxable. I dunno why this gets such taboo treatment. It would solve the 'problem' instantly!!!! |
Ding! Ding!! Ding!!! Ladies and Genltmen, we have a winner!!!!!
Absolutely the obvious answer. My guess is we'd even still be able to cap it but at a somewhat higher rate.
There are a few problems with privatization. One is that SS is a guaranteed benefit that's not at the whims of a market collapse. Two, The proposal to leave some workers keep a portion of their retirement privately will cause a HUGE financial shortfall in the medium term, essentially driving the nail in the coffin of SS prematurely (which many think is really the goal anyway).
Three, we're crappy savers here in the US of A. Sad but true. Look at current private retirement accounts just to get an idea. Increasing the cap on contributions is silly, as a tiny minority of us actually come anywhere close to even approaching the current yearly caps. Meanwhile, look also at how much 401Ks and IRAs are depleted and cashed-out (even with penalties) prior to retirement. In the aggregate Americans just can't seem to keep their hands off of that moolah. Granted, some of the cashout may be for things like college or catastrophic illness, but much of it is not.
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sonnylax
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Posted: 10/26/04 - 08:59 Post subject:
| RexRacer wrote: | | Three, we're crappy savers here in the US of A. Sad but true. Look at current private retirement accounts just to get an idea. Increasing the cap on contributions is silly, as a tiny minority of us actually come anywhere close to even approaching the current yearly caps. Meanwhile, look also at how much 401Ks and IRAs are depleted and cashed-out (even with penalties) prior to retirement. In the aggregate Americans just can't seem to keep their hands off of that moolah. Granted, some of the cashout may be for things like college or catastrophic illness, but much of it is not. |
So the federal govt. is responsible to provide income (cradle to grave) because Americans are stupid & can't keep their hands off that moolah? Does anyone take any responsibility for their own actions anymore?
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runaroundsue
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Posted: 10/26/04 - 09:04 Post subject:
| sonnylax wrote: |
So the federal govt. is responsible to provide income (cradle to grave) because Americans are stupid & can't keep their hands off that moolah? Does anyone take any responsibility for their own actions anymore? |
another winner!!!
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