Trump's win and your social security (trust fund, taxes, investments, return)

[2sleepy]

Originally Posted by Stratman

Big deal. A few years ago I received a SS statement in the mail. I was running some numbers when DW came in and asked what I was doing. I told her I was calculating how much I would have if I had been allowed to invest my SS money myself. She said, "don't do that. It will **** you off." I kept working.
At the time, my SS statement said I would get $1700 per month at FRA. Knowing what I had paid in every year and knowing how my investments have performed, I calculated that at FRA, I would have had not $1700 per month but $10,000 per month. And that's only counting my share, not what my employer had to put in. DW was right. I was pissed off. If I were a young person today and given the option of SS or doing my own retirement, I would certainly opt out of SS. The return sucks.

Please share the math you used to calculate that because if your SS check will only be $1700 your average earnings are not very high. Since you pay 6.2% into SS I am baffled as to what you would have invested that in to give you returns that would allow you to withdraw $10,000 a month until you die...but I will withhold judgment until I see your calculations.

[High_Plains_Retired]

Anyone who depends on politicians to do their financial planning is bound to be very bitter when they get old.

Any politician (right, middle or left) is much more interested in themselves than in others. If they weren't they wouldn't be human and they would not be a politician. The typical human will first seek money and wealth after which they seek power.

[nicet4]

Originally Posted by Stratman

Big deal. A few years ago I received a SS statement in the mail. I was running some numbers when DW came in and asked what I was doing. I told her I was calculating how much I would have if I had been allowed to invest my SS money myself. She said, "don't do that. It will **** you off." I kept working.


At the time, my SS statement said I would get $1700 per month at FRA. Knowing what I had paid in every year and knowing how my investments have performed, I calculated that at FRA, I would have had not $1700 per month but $10,000 per month. And that's only counting my share, not what my employer had to put in. DW was right. I was pissed off. If I were a young person today and given the option of SS or doing my own retirement, I would certainly opt out of SS. The return sucks.

Some things you missed.

I did the same thing about three years ago when I was just about to turn 65.

If I had elected to take my FRA benefit it would have been $2,250 but I am putting it off until age 70 (less than two years to go now) when I will be getting right around $3,050.

Anyway, if I had simply taken the total contributed, this includes the employers contribution which for half of my working life was me as I was self employed, putting it into a common everyday bank passbook savings account I would have right around $850,000 today. This is bank passbook based on historical interest rates since the early 1960's when I started working.

My wife gets 50% of my benefit so we will receive right at $4,175 in social security alone.

With $850,000 it will take us 203 months, call it 17 years, for us to get all our money back.

At first glance not that great of a deal but did you consider things like disability or survivors insurance? Go ahead, if you are 30 years old I want you to try to purchase disability insurance that will pay you 50% of your income for the rest of your life whatever that is. Not just you but your wife would receive some money as would dependent children.

What would have happened if you had fallen off the roof cleaning gutters and broken your back? There goes that construction job but now what?

If I had died in 1985, bad things happen because sometimes life sucks, I left $500,000 in insurance which was a lot of money for 1985 but not so much today. What would have happened to my young wife with children if I died from cancer? The insurance would have helped but looking at inflation it would not have lasted forever but that $2,000 monthly social security survivor check would have.

Most disability insurance policies today only last two years, they pay just 50% of your salary and they are not cheap. Try to get one that would pay maybe 50 years and see what your premiums would be... you couldn't afford it.

So it's insurance really and I am glad I paid into it even if I never get all my money back. I am happy I paid into it because somewhere out there is a young mother who lost her husband trying desperately to make it with the only thing between her and the streets is that social security survivors disability benefit check.

And yeah, shoulda, coulda and woulda. If only everyone saved just 10% of their paycheck investing it for future retirement but things don't always go as planned. Think of WorldCom, Bernie Madoff and Enron along with the thousands of workers there that had their retirement tied up in those companies. I am sure today many are thankful they got social security today.

The shoulda, woulda... yeah, most of us, me included, would NOT have put away 10% because for most of us it isn't in our nature. What 23 year old puts away 10%? One out of a thousand maybe?

And there is you.... not being mean or spiteful but did you save 3% of your money putting it away for 50 plus years so now you can get $3,000/month? No, you didn't but I didn't either.

And COLA's, my wife and I are guaranteed money for the rest of our lives with built in inflation protection. Yeah, it isn't perfect but it sure as hell beats nothing.

Social security is a whole lot more than just old age money and as a hard right winger and Trump supporter I am glad we got it.

[Stratman]

Originally Posted by ansible90

Well you must have been very very lucky in your investments. But Social Security was never meant to be based on investment return. It's more like a forced savings/contribution with a guaranteed payment in retirement -- even if the market is down.

Investments have no guaranteed return. And there is no guarantee that you would have actually kept up the monthly investment over all those years. How many times over the years would you have stopped the monthly investments because you needed a new car, or a new roof or whatever other expensive necessity.

Luck had nothing to do with it. It was hard work, plain and simple. Of course there are no guarantees. Guaranteed returns equals low returns. And no, there would have been no stopping to make purchases because I budgeted for all those items, including my investments. The point is that people talk about how horrible it would be to allow people to opt out of SS when the numbers show the opposite to be true.

[Stratman]

Originally Posted by 2sleepy

Please share the math you used to calculate that because if your SS check will only be $1700 your average earnings are not very high. Since you pay 6.2% into SS I am baffled as to what you would have invested that in to give you returns that would allow you to withdraw $10,000 a month until you die...but I will withhold judgment until I see your calculations.

Sorry, did the calculations on a spreadsheet that is to long and complicated to share here and as I said, this was done years ago so the SS benefit now is higher. As far as investments, mine consist of good stock growth mutual funds and adding that SS money to those investments beats the crap out of SS.

[qmuddy2]

what will trump & republicans do with social security ? privatize it ? eliminate it ? cuts ? thanks

[Stratman]

Originally Posted by Serious Conversation

It's a sacred cow for those currently or nearing retirement.

As someone who has only been in the professional workforce for six years and likely won't retire for another thirty to thirty-five, I would probably get better returns if it was abolished and could invest my own money.

Still, SS is insurance, not a retirement plan in and of itself.

You can't just abolish it; that would leave too many people out in the cold. But people should be given a choice. You can either join SS or elect to invest a mandatory percentage of your income however you choose. The point is, people would have the freedom to choose instead of being forced into a government program.

[biscuitmom]

Originally Posted by RiverBird

Anyone who relies in large part on Social Security and Medicare should be worried. Note these were not topics in the debates.

And Medicaid.

[Pitt Chick]

//www.city-data.com/forum/retir...-security.html

[Hollytree]

This is what CBS news reported:

How Hillary Clinton and Donald Trump view Social Security - CBS News