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yeah..funny how that works, sort of like my car and homeowners insurance premiums huh? I never filed a claim so it's sort of like welfare to all the people who get in car wrecks or set fire to their house
Shared risk. Yes other people helped pay for storm damage to my house and car and I live 150 miles from the coast. I don't think I made a bad choice that resulted in this. It was just bad luck. Good thing we pool resources to watch out for each other and I am grateful to those who never had a claim. I would have had a really tough time without the help.
Social Security won't go away because the wealthy like the program. Middle class people pay the cost of supporting low income people, so the wealthy won't have to. I think (don't know for sure) there is an "inflection" point around $45k. Earnings up to (somewhere around) $45K get a much higher rate of return (I believe it is double, a .2 multiplier in place of a .1 multiplier), compared to earnings above $45k. People who earn the social security "cap" will get the worst return on what they have contributed. Those making $45K or less get a much better return. Someone making $115,000 a year will not get back what they paid in. Someone making $30k a year will get back more than what they pay in. If those making over $45K a year were not not subsidizing the working poor, then the wealthy would have to pay more taxes for welfare to support the working poor. So the wealthy like the system the way it is.
Someone working 50 years gets exactly the same amount as someone who worked 35 years, if they had the same earnings over those years. If each person earned $50,000 each of the years they worked, they still get the same Social Security.
Younger Americans should be especially vigilant against raising the retirement age, which is most likely how they will get screwed over. Social Security is well funded, it has not been raided. If no changes are made, it would end up paying around 78% of benefits starting around 2033 but it would never go broke. Raising the cap (because of the inflection point) bails out Social Security painlessly.
WASHINGTON – Jeb Bush thinks the next president will need to privatize Social Security, he said at a town hall meeting in New Hampshire on Tuesday – acknowledging that his brother attempted to do so and failed. It’s a position sure to be attacked by both Republicans and Democrats.
It seems you are on a quest to demonize (R's) even in niche sections of the forum, that in theory politics are prohibited in.
While I would not personally censor you in such sections, your fellow "open-minded liberals" go around pushing the report button to get the opposing point of view shut down. Yet they will allow likeminded politics to remain.
Isn't that a classic example of hypocrisy?
As an FYI, though I am not a Jeb supporter at the moment, his ideas make sense. More importantly for those reading this thread, he is talking about keeping everything the same for current recipients. However he is acknowledging that in the future, a titrated system to tweak the system will be needed to maintain it's viability.
So scaremongering should not trump facts/reality in threads like this with a political agenda.
the point is that I have been paying for car insurance for over 4 decades and I have never filed a claim, my money has been paying for someone else's bad driving
Quote:
Originally Posted by 2sleepy
yeah..funny how that works, sort of like my car and homeowners insurance premiums huh? I never filed a claim so it's sort of like welfare to all the people who get in car wrecks or set fire to their house
Quote:
Originally Posted by ReachTheBeach
Shared risk. Yes other people helped pay for storm damage to my house and car and I live 150 miles from the coast. I don't think I made a bad choice that resulted in this. It was just bad luck. Good thing we pool resources to watch out for each other and I am grateful to those who never had a claim. I would have had a really tough time without the help.
Several points here.
First to address 2sleepy's incorrect conflation of insurance.
He likely paid more or less, based on where he lives (i.e. rural area vs. populace city) which dictates risk/probability factors for his area.
Second his premiums were primarily based on his own behavior, which again equates to risk/probability. If his habits are good, he reaps the benefit of lower premiums. If it is bad, he pays the price in higher premiums. You cannot get a more fair way of holding the individual responsible for their own actions.
Another important point is that he is not mandated by the federal government to pay for general insurance rates covering irresponsible people, by having a non negotiable amount of money forcibly taken out of his paycheck every week.
[Even if local government mandates a minimum level of insurance for the privilege to drive, it can be a bare minimum in comparison to rates based on the irresponsibility of others.
In regard to ReachTheBeach, yes collective risk sharing is the hallmark of insurance, which in most cases is voluntary.
Still you are making financial choices based on your own assessment of risk. Another words, if you choose to carry the minimum insurance to save on monthly premiums, that is your choice. If something goes wrong, you will only receive the coverage you paid for. Your neighbor on the other hand might have his entire home be built to a better structure without paying out of pocket for upgrades such as current code requirements.
Why?
Simple, because he had a choice to pay higher premiums based on his own perceived needs.
Social Security does not give anyone those type of choices. As a matter of fact, it is moving in the direction of penalizing those who make good choices in life and become wealthy.
Ever heard of the term "means testing"?
All it stands for is that those who forcibly paid into the SS system, might be made to give up a portion or all of their money. Why, because "they do not need it now".
It is just one more way liberals want to tax the rich to pay for the poor.
Put more accurately, those who work hard and get ahead will have their money taken away from them, in an effort to provide for those who were irresponsible.
I am no where near Bill Gates address in life, but I do not believe he should have his SS essentially taken away from him, because the current government mindset might want even great wealth redistribution.
We already have taxes for such schemes.
Now if he voluntarily chooses to give it up fine. But it should not be determined for him that his SS will be taken away based on some bureaucrats/politicians current mindset.
How this all relates to this thread as I understand it, is because Jeb has said the SS system as it is currently structured, cannot survive.
There is nothing wrong with a politician being honest and looking ahead, past when he will potentially be in office, and try to solve the impending crisis. If anything it is a bold, mature, responsible move, because most politicians only want to kick the proverbial can down the road.
Why?
Because of their own self interest. Yet such problems must be address to prevent a coming train wreck, even if it means they will pay a political price.
We need more politicians like that, not less.
Social Security's problem is that the program is stuck in a 1950's model of a family/worker that largely no longer exists. Every other major western nation has revamped their SS schemes to bring them inline with modern reality.
Things like "file and suspend", several divorcees and a widow all claiming from one worker's record, children and surviving spouses automatically entitled to payments even when their financial situation is neither dire nor severe; but actually quite comfortable. Those sort of things.
Regarding raising the retirement age that is something which will need to happen. While we are on that subject it gets me when persons act as if raising the SS age will somehow bring on the end of the world. We are talking about raising the age persons can begin receiving benefits. That in of itself does *NOT* mean someone cannot retire. My parents "retired" in their early sixties because it made sense from their pension point of view. They delayed filing SS since it wasn't needed and they wanted to let that money ride.
For any annuity or insurance scheme the numbers always work out the same; the longer persons receive benefits the more it costs. Prior to say the 1970's persons "retired" at 65 and were dead on average by their early 70's. Now thanks to better healthcare if you make it to your early sixties you may live ten, twenty or more years.
SS much change again because demographics will demand. The number of workers in the American economy has declined. This will continue as the wave of Boomers make their way through retirement. What you will be left with is a smaller pool of workers paying into the system to support a large number of retired.
The other big unknown is how or if gay marriage will bring a new wave of spousal benefits. Survivor are less of a concern because you can only choose yours or the deceased.
SS is a welfare program. Gov't taxing current workers to give the money to those who don't work because of achieving a certain age or disability is welfare by a different name. The recipient is not just getting their own money back, they're getting money taken forcibly from someone else (current workers). It's a great deal for the recipient in that it's "guaranteed" by the federal gov't, meaning the taxpayer, but you cannot ignore the fact that the total of what you've paid into it over the years is recovered within a few years of collecting. That means you're getting money simply for still being alive. That means it's a welfare program. And unsustainable, like all government entitlements. And I for one don't like to see people with great pensions and assets collecting welfare. It should be for those who need it, not those who like extra spending money at the expense and generosity of the taxpayer. I wonder if this amounts to more money than "corporate" welfare. Incalculable, since you'd need a means standard for SS first. Oh well.
I would like to point out that many of us will not recover what we (and our employer) have paid into the system in just a few years. That may be true for the current elderly and the early baby boomers but this is changing. Attached is an article that is a few years old that explains the math and I am sure I could find more.
You may make a killing on Medicare but it is getting to the point where you will not get your Social Security back unless you live for a long time. This is especially true for high earning single males.
From the article:
"According to the institute’s data, a two-earner couple receiving an average wage — $44,600 per spouse in 2012 dollars — and turning 65 in 2010 would have paid $722,000 into Social Security and Medicare and can be expected to take out $966,000 in benefits. So, this couple will be paid about one-third more in benefits than they paid in taxes.
If a similar couple had retired in 1980, they would have gotten back almost three times what they put in. And if they had retired in 1960, they would have gotten back more than eight times what they paid in. The bigger discrepancies common decades ago can be traced in part to the fact that some of these individuals’ working lives came before Social Security taxes were collected beginning in 1937."
The one third more in benefits is mostly due to Medicare. The articles shows different scenarios for married and single persons based on when they retire.
Last edited by ABQ2015; 06-28-2015 at 02:21 PM..
Reason: correct link
I would like to point out that many of us will not recover what we (and our employer) have paid into the system in just a few years. That may be true for the current elderly and the early baby boomers but this is changing. Attached is an article that is a few years old that explains the math and I am sure I could find more.
You may make a killing on Medicare but it is getting to the point where you will not get your Social Security back unless you live for a long time. This is especially true for high earning single males.
From the article:
"According to the institute’s data, a two-earner couple receiving an average wage — $44,600 per spouse in 2012 dollars — and turning 65 in 2010 would have paid $722,000 into Social Security and Medicare and can be expected to take out $966,000 in benefits. So, this couple will be paid about one-third more in benefits than they paid in taxes.
If a similar couple had retired in 1980, they would have gotten back almost three times what they put in. And if they had retired in 1960, they would have gotten back more than eight times what they paid in. The bigger discrepancies common decades ago can be traced in part to the fact that some of these individuals’ working lives came before Social Security taxes were collected beginning in 1937."
The one third more in benefits is partly due to Medicare. The articles shows different scenarios for married and single persons based on when they retire.
For the tail end Boomers (those born say late 1950's through early 1960's) yes, they likely will not get back much of what they put into SS unless as you say they (or their surviving spouse) lives a long time. This is more true from for high earners especially now that Obamacare has added a new Medicare tax to capital gains.
Many younger Boomers are screwed. Thanks to recent upheavals in the economy no small number are filing soon as possible because quite frankly they have given up ever finding employment again. That or they are filing for disability for the same reasons. Filling early is one of the worse things you can do in regards to SS, but when you need that check...
WASHINGTON – Jeb Bush thinks the next president will need to privatize Social Security, he said at a town hall meeting in New Hampshire on Tuesday – acknowledging that his brother attempted to do so and failed. It’s a position sure to be attacked by both Republicans and Democrats.
Australia & Chile have privatized systems. So should we. The tricky parts are the transition to such a system and making sure the fees in a privatized system are low. The fee part should be easy. It could be modeled after what the federal government's plan for its employees, which is super low cost. Wealth levels in Australia are much higher than in the U.S. as a result.
First to address 2sleepy's incorrect conflation of insurance.
He likely paid more or less, based on where he lives (i.e. rural area vs. populace city) which dictates risk/probability factors for his area.
Second his premiums were primarily based on his own behavior, which again equates to risk/probability. If his habits are good, he reaps the benefit of lower premiums. If it is bad, he pays the price in higher premiums. You cannot get a more fair way of holding the individual responsible for their own actions.
Another important point is that he is not mandated by the federal government to pay for general insurance rates covering irresponsible people, by having a non negotiable amount of money forcibly taken out of his paycheck every week.
[Even if local government mandates a minimum level of insurance for the privilege to drive, it can be a bare minimum in comparison to rates based on the irresponsibility of others.
In regard to ReachTheBeach, yes collective risk sharing is the hallmark of insurance, which in most cases is voluntary.
Still you are making financial choices based on your own assessment of risk. Another words, if you choose to carry the minimum insurance to save on monthly premiums, that is your choice. If something goes wrong, you will only receive the coverage you paid for. Your neighbor on the other hand might have his entire home be built to a better structure without paying out of pocket for upgrades such as current code requirements.
Why?
Simple, because he had a choice to pay higher premiums based on his own perceived needs.
Social Security does not give anyone those type of choices. As a matter of fact, it is moving in the direction of penalizing those who make good choices in life and become wealthy.
Ever heard of the term "means testing"?
All it stands for is that those who forcibly paid into the SS system, might be made to give up a portion or all of their money. Why, because "they do not need it now".
It is just one more way liberals want to tax the rich to pay for the poor.
Put more accurately, those who work hard and get ahead will have their money taken away from them, in an effort to provide for those who were irresponsible.
I am no where near Bill Gates address in life, but I do not believe he should have his SS essentially taken away from him, because the current government mindset might want even great wealth redistribution.
We already have taxes for such schemes.
Now if he voluntarily chooses to give it up fine. But it should not be determined for him that his SS will be taken away based on some bureaucrats/politicians current mindset.
How this all relates to this thread as I understand it, is because Jeb has said the SS system as it is currently structured, cannot survive.
There is nothing wrong with a politician being honest and looking ahead, past when he will potentially be in office, and try to solve the impending crisis. If anything it is a bold, mature, responsible move, because most politicians only want to kick the proverbial can down the road.
Why?
Because of their own self interest. Yet such problems must be address to prevent a coming train wreck, even if it means they will pay a political price.
We need more politicians like that, not less.
`
You have choices, Social Security is not forced on you, YOU can choose not to work, or YOU can choose to work for a system in which you do not contribute into Social Security like many teachers and police officers. If you do pay into SS you will be able to get some money when you are age eligible, doesn't sound like a very scary system to me.
Jeb is full of beans. If you removed the the wage cap and imposed SS tax on all wages SS would be guaranteed solvency for at least 75 years, but I'm not dumb..he needs people with $ to get him in the White House and he won't dare make them mad.
And as far as your assumption that rates for auto or home insurance are inherently "more" fair because rates are determined risk/probability I completely disagree. If car insurance rates were based on the probability that I will cause an accident the insurance company should be paying me. And what is the point of your even bringing that up? Are you suggesting that some people should pay into SS at a higher rate than others based on some kind of 'probability'?
The really funny thing about your libertarian manifesto is that I bet you aren't wealthy but somewhere along the line you were convinced that some day you will be... just like all the rest of the folks here who make $18 an hour and perpetually talk about the Government stealing their wealth
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