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We are off on a tangent, but I did not realize what you are suggesting is possible. I went to tech school and paid for it with a small inheritance and my wife went part time for years mostly on academic scholarships so we didn't have loans. Our first experience is with our oldest and the loan is handled through the tuition office; directly paying for school and I think you can submit qualifying expenses (books) for reimbursement but you can't just get cash for anything. Is this not how they are normally handled?
It could be with private student loans than say Stafford loans too. Most students do get them from schools rather than private loans. That said, most schools just give the money and don't have limits to it. Like as I said in previous post, if I cash a medical insurance check just to send it back out to the doctor looking for that amount, did I pay with that check or my own moneies? We can't tell of the student money actually went to a car payment or not if it was in a general account. One would need to create a separate account for you to see what money truly goes where.
It could be with private student loans than say Stafford loans too. Most students do get them from schools rather than private loans. That said, most schools just give the money and don't have limits to it. Like as I said in previous post, if I cash a medical insurance check just to send it back out to the doctor looking for that amount, did I pay with that check or my own moneies? We can't tell of the student money actually went to a car payment or not if it was in a general account. One would need to create a separate account for you to see what money truly goes where.
A double tangent; my medical policy will only send me a check if I provide documentation to show I have already paid and they are reimbursing me. Otherwise they pay the doctor and/or facility directly.
Blackrock CEO has proposed a new retirement system for Millennials. It is worth a good read and will certainly provoke great discussion by many young folk as they look down the road. Will also be controversial as it is debatable how many would trust and buy in to.
The question especially for younger forum participants is would you want the program? Those in their middle years and later it might not be able to do enough for soon enough. Would be better than nothing for them however.
RULE #1: NEVER take retirement advice from an INVESTMENT COMPANY. Guess what they're going to tell you? Get a system whereby you INVEST IN SECURITIES, through INVESTMENT COMPANIES/BROKERAGES. Duh.
I repeat: NEVER take retirement advice from any company that has an interest in what a retiree does with his money! NEVER. NEVER. NEVER.
Who to take advice from? Independent experts. Those who write columns on well known, high visible sites (look @ what advertising they accept, though). Your own financial advisor (IF they don't have a fee structure where they make money every time they do something for you). Read read read all sorts of independent sources.
RULE #2: Don't base your investment plan on what an INVESTMENT COMPANY says. An investment company will almost certainly say that THE MORE YOU INVEST IS THE BETTER PATH, AND LEAVE AS LITTLE IN CASH AS POSSIBLE. That's because the more you invest, the more money they make. Duh.
Also, Social Security is one of the most successful programs ever started in our country. It has been immensely successful at doing what it was designed to do. Before SS, the MAJORITY of our seniors were below the poverty line. Now, because of SS, only 10% are. SOCIAL SECURITY works. It works because of the "social" aspect, and the "security." It will not work if each beneficiary has his own separate fund.
Then think about this: Do you really want to put your retirement security in the hands of the companies that led us to the GREAT RECESSION? Is that wise? Of course not.
Privatizing SS is NOT Social Security. We have private SS already. It's called 401k. And the investment companies have bilked those funds for all they're worth, charging high fees, providing poor choices for the employees, hiding fees. Merrill Lynch is being investigated for fraud regarding its 401k plans (it was bought out by Bank of America).
Remember: Social Security is "SOCIAL," and is "SECURE." If you live longer than expected, you should know that you will NOT run out of that supplemental income. That's what prevents our elderly from becoming homeless or in dire poverty.
"Fool me once shame on you. Fool me twice shame on me". I am not sure who said it first but it still applies today. Why would anyone trust a retirement system that depends on our government to administer it?
I'm not sure that the government would administer this program. It sounds like the supporters want banks or investment firms to administer this system with the government guaranteeing that the fund make at least 2% gains.
When do investments generally do poorly? When the economy does badly. When is government tax revenue generally lowest? When the economy does badly. When would this system require the government to kick in to significant amounts to guarantee a return of 2%? When the economy does badly.
The government would assume all the risk while the bankers would get fat on their fees with no repercussions for them for poor management. Sorry, but I'd trust the government over a bunch of bankers any day.
I'm not sure that the government would administer this program. It sounds like the supporters want banks or investment firms to administer this system with the government guaranteeing that the fund make at least 2% gains.
When do investments generally do poorly? When the economy does badly. When is government tax revenue generally lowest? When the economy does badly. When would this system require the government to kick in to significant amounts to guarantee a return of 2%? When the economy does badly.
The government would assume all the risk while the bankers would get fat on their fees with no repercussions for them for poor management. Sorry, but I'd trust the government over a bunch of bankers any day.
Blackstone manages most of the government financial funds.
The Government does administer them though.
And this new GRA would fall under the same rules.
The government would not assume any risk.
The proposal charges people "premiums" to guarantee a 2% return.
FWIW those big bankers run most of the government programs dealing with money.
They are trying to get ahold of 401Ks as well but companies have said "no thanks".
Here's more detail on this GRA proposal. It's not new at all.
Just being resurfaced now with Clinton in the running.
RULE #1: NEVER take retirement advice from an INVESTMENT COMPANY. Guess what they're going to tell you? Get a system whereby you INVEST IN SECURITIES, through INVESTMENT COMPANIES/BROKERAGES. Duh.
I repeat: NEVER take retirement advice from any company that has an interest in what a retiree does with his money! NEVER. NEVER. NEVER.
Who to take advice from? Independent experts. Those who write columns on well known, high visible sites (look @ what advertising they accept, though). Your own financial advisor (IF they don't have a fee structure where they make money every time they do something for you). Read read read all sorts of independent sources.
RULE #2: Don't base your investment plan on what an INVESTMENT COMPANY says. An investment company will almost certainly say that THE MORE YOU INVEST IS THE BETTER PATH, AND LEAVE AS LITTLE IN CASH AS POSSIBLE. That's because the more you invest, the more money they make. Duh.
Also, Social Security is one of the most successful programs ever started in our country. It has been immensely successful at doing what it was designed to do. Before SS, the MAJORITY of our seniors were below the poverty line. Now, because of SS, only 10% are. SOCIAL SECURITY works. It works because of the "social" aspect, and the "security." It will not work if each beneficiary has his own separate fund.
Then think about this: Do you really want to put your retirement security in the hands of the companies that led us to the GREAT RECESSION? Is that wise? Of course not.
Privatizing SS is NOT Social Security. We have private SS already. It's called 401k. And the investment companies have bilked those funds for all they're worth, charging high fees, providing poor choices for the employees, hiding fees. Merrill Lynch is being investigated for fraud regarding its 401k plans (it was bought out by Bank of America).
Remember: Social Security is "SOCIAL," and is "SECURE." If you live longer than expected, you should know that you will NOT run out of that supplemental income. That's what prevents our elderly from becoming homeless or in dire poverty.
So even a lowly non-talented nobody who makes $15/hr over his entire working life and who takes his social security withholding of 15% and invests it at a final return of only 5% will retire a millionaire.
If anything better happens, or he gets raises every so often, or works some overtime, or gets a second job? Mind boggling. Easy $2,000,000 in the bank at 65 for a putrescent nobody.
If you have some talent and get a normal $60,000-$100,000 job? Many millions in the bank!
Compare that to now where you arrive at 65 with an expectation of living 15 years and collecting $2,200/month.
2200 x 12 x 15 = an effing piddly $396,000 over time.
And that does not figure that the millions you have in the bank under a personal SS plan would continue to grow even after retirement, and could be left to your kids for their retirement if you die.
So even a lowly non-talented nobody who makes $15/hr over his entire working life and who takes his social security withholding of 15% and invests it at a final return of only 5% will retire a millionaire.
If anything better happens, or he gets raises every so often, or works some overtime, or gets a second job? Mind boggling. Easy $2,000,000 in the bank at 65 for a putrescent nobody.
If you have some talent and get a normal $60,000-$100,000 job? Many millions in the bank!
Compare that to now where you arrive at 65 with an expectation of living 15 years and collecting $2,200/month.
2200 x 12 x 15 = an effing piddly $396,000 over time.
And that does not figure that the millions you have in the bank under a personal SS plan would continue to grow even after retirement.
I think you are likely a smart guy even if I don't agree with your politics. Smart enough to know what $2M would be worth if everyone has $2M+. Smart enough to know that there are not enough jobs for full employment. Smart enough to know that unless wages increase, forcing that kind of expense on every worker will require higher wages.
If you ignore the rhetoric and political dogma, you just agreed with everything I wrote. The difference is that I think it's my obligation to society as one of the fortunate "haves" to subsidize all those "have nots". I think Social Security is a great program. It has essentially ended elderly poverty. The problem is that the whole "trust fund" is a big charade. Social Security needs to be cash flow neutral. Today, what goes-out exceeds what goes-in and only the slight of hand of "interest on the trust fund" makes the books balance. The program is underfunded by 30% mostly due to the realities of people living longer and our declining birth rate among the economically successful part of our population. We need to increase taxes in some way to account for this. I think the increase should be broad-based so everybody feels a bit of the pain. I'd increase the employee contribution percentage a bit without nailing employers. I'd let the cap drift up a bit. I'd put a modest tax on passive income and earned income above the cap. If we go full-Bernie, I'd be OK with eliminating the cap. I'm high income so I'd see it in my paycheck in the 2nd half of each year but it wouldn't change my quality of life a bit. I think it would be more fair to have everyone have a stake in the pain but it wouldn't change my life at all.
You can feel all the obligation you want. With money you own and earn. But if you're going to jump on some faux moral high horse and mandate that others obey your edict and agree with your depraved view of your fellow man and loot and plunder people to pay other people under penalty of death and/or imprisonment, then I reject your moral philosophy and declare it bankrupt.
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