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While a valid point I don't think we are there yet and are still probably 25-30 years out from the trust fund running short of special treasury notes to cash in.
Yes, but I'm surprised you stop there. For other readers (you already know this), the sooner we take steps to extend solvency of Soc Sec, the less costly and more fair it's likely to be for current and future generations.
And while Soc Sec may be solvent, retirees also rely on Medicare and that's been insolvent for a long, long time (again, as you know). Seems like a cop-out to point to Soc Sec current solvency when the exact same retirees are about to help put Medicare even further under water, again taking more from future generations. We call the contributions FICA, Medicare Taxes, FIT - but ultimately it's all total revenue in vs total spending at the Federal level in this case. As you know, it sort of like saying I make $1000 month and my mortage is $900, so I'm solvent. What about food, clothing, utilities, etc.
To the OP, I can see the inequity of raising the retirement age to lower income workers. It's harder to work longer at physical labor than it is to sit in an office, a generalization with some basis in reality. So if we don't raise retirement age, and that may be the right call, we're going to have to reduce benefits, or reduce COLAs, or means test, or increase FICA & Medicare taxes or some combination. I suspect a combination of all would be most fair, though reasonable people (and others) will undoubtedly disagree...
Yes, but I'm surprised you stop there. For other readers (you already know this), the sooner we take steps to extend solvency of Soc Sec, the less costly and more fair it's likely to be for current and future generations.
And while Soc Sec may be solvent, retirees also rely on Medicare and that's been insolvent for a long, long time (again, as you know). Seems like a cop-out to point to Soc Sec current solvency when the exact same retirees are about to help put Medicare even further under water, again taking more from future generations. We call the contributions FICA, Medicare Taxes, FIT - but ultimately it's all total revenue in vs total spending at the Federal level in this case. As you know, it sort of like saying I make $1000 month and my mortage is $900, so I'm solvent. What about food, clothing, utilities, etc.
What am I missing?
Nothing but this is an old discussion held over and over again and was trying to bring some what many would consider factual presentation to the discussion. It is emotional and it is the consequences of the solutions that might hurt and who to feel that? SS and Medicare are very different problems. There will be a natural occuring outcome to Medicare as we have discussed.
Nothing but this is an old discussion held over and over again and was trying to bring some what many would consider factual presentation to the discussion.
So was I, and I acknowledged my post was not news to you, but fair enough.
So what is the answer to the age old forum dilemna - no matter how many times answers are posted "over and over" on any forum, the same questions are repeated endlessly. That's what I'd really like to know. I've seriously considered keeping my answers to the top 20 questions ready to cut-n-paste into threads...
So was I, and I acknowledged my post was not news to you, but fair enough.
So what is the answer to the age old forum dilemna - no matter how many times answers are posted "over and over" on any forum, the same questions are repeated endlessly. That's what I'd really like to know. I've seriously considered keeping my answers to the top 20 questions ready to cut-n-paste into threads...
As far as I am concerned ss is not an entitlement I paid for it. If it was invested and making interest, I would never run out of money.
On the other hand I was promised Medicare! Planned on it.
I think early retirement should be raised to 63.
Ahhhh thats part of the is it or isn't it. Was it or wasn't it. It was used to purchase special treasury notes different from regular bonds. They have specific durations and specific interest rates that are available on line. Thus is it truly an investment is up to the individual I guess.
Trust funds and types of investments
The Old-Age and Survivors Insurance Trust Fund and the Disability Insurance Trust Fund comprise the Social Security trust funds. Both funds are managed by the Department of the Treasury through their Bureau of Public Debt. Since the beginning of the Social Security program, all securities held by the trust funds have been issued by the Federal Government. There are two general types of such securities:
• Special issues—available only to the trust funds
• Public issues—marketable Treasury bonds available to the public
Effective interest rates
Although new investments for each trust fund carry the same interest rate, amounts of income and outgo differ between funds, resulting in a different investment portfolio for each trust fund. An effective interest rate provides a measure of the rate of return on an investment portfolio. We calculate an effective interest rate by dividing interest earned on investments during a calendar year by the average level of investments during the year. A table of such effective rates provides rates back to 1940 by trust fund.
Unless the trust fund is "invested" with private firms , it is the general fund that will be paying back those IOU's.
Exactly and that is the problem in a nutshell.
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