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Author: superr Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76421  
Subject: social security Date: 4/25/1998 9:39 AM
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Hi..Im 18 and Im going to start investing for my retirement...Im curious tho..seeing Im paying a lot of social sec. tax, and I know I won't see a penny in about 2040 when I come around to retirement..but is it possible to divert the money I pay into the government and put it into some type of retirement account? Any type..as long as I have some money to look forward to...
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Author: TMFPixy Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3033 of 76421
Subject: Re: social security Date: 4/25/1998 11:57 AM
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Greetings, Superr, and welcome.

<<Hi..Im 18 and Im going to start investing for my retirement...Im curious tho..seeing Im paying a lot of social sec. tax, and I know I won't see a penny in about 2040 when I come around to retirement..but is it possible to divert the money I pay into the government and put it into some type of retirement account? Any type..as long as I have some money to look forward to...>>

Nope, you cannot divert your FICA taxes (note I did NOT say contributions) to an investment of your choice at this time. Perhaps in the future should Congress change the rules on Social Security, but definitely not now.

I do believe your fears are unfounded, though. While Social Security will definitely change, it will still be there as long as the United States exists as a country. The changes will be substantial, the promised payments smaller, the age for retirement later. But the system will still be there unless the official language of the country has changed to Chinese, Farsi, or something else.

Regards….Pixy


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Author: nhodge One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3042 of 76421
Subject: Re: social security Date: 4/26/1998 9:51 AM
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>>
Nope, you cannot divert your FICA taxes (note I did NOT say contributions) to an investment of
your choice at this time. Perhaps in the future should Congress change the rules on Social Security,
but definitely not now.

I do believe your fears are unfounded, though. While Social Security will definitely change, it will
still be there as long as the United States exists as a country. The changes will be substantial, the
promised payments smaller, the age for retirement later. But the system will still be there unless the
official language of the country has changed to Chinese, Farsi, or something else.

Regards….Pixy <<

Sure, it might be there, but if the payments are inconsequential, which they eventually will be, and the retirement age is so late (I don't think this will happen), then, effectively, it is gone. Personally, I am planning like it will be gone, and if I get some, fine.

Neil


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Author: TMFPixy Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3044 of 76421
Subject: Re: social security Date: 4/26/1998 9:56 AM
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Greetings, Neil, and welcome.

<<Sure, it might be there, but if the payments are inconsequential, which they eventually will be, and the retirement age is so late (I don't think this will happen), then, effectively, it is gone. Personally, I am planning like it will be gone, and if I get some, fine.>>

And that's a perfectly legitimate planning procedure. The worst that will happen is you'll end up with too much money. What a revolting development that would be!

Regards....Pixy

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Author: FoolishBull One star, 50 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3049 of 76421
Subject: Re: social security Date: 4/26/1998 2:43 PM
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[[Hi..Im 18 and Im going to start investing for my retirement...Im curious tho..seeing Im paying a lot of social sec. tax, and I know I won't see a penny in about 2040 when I come around to retirement..but is it possible to divert the money I pay into the government and put it into some type of retirement account? Any type..as long as I have some money to look forward to...]]

Superr,

Regarding SS, I don't have anything to add except TMF2Aruba started a discussion in the "fools and their money" message board.  See http://boards.fool.com/Message.asp?id=1040007000287001&sort=id

I think it is great that you are getting Foolish early since the next 10 to 20 years can make a big difference in your bottom line when you retire.

Say you open a self-directed IRA account and invest 2000 at the end of each year until retirement (assume 65).  Here's how your bottom line could change depending on the age you start investing and your rate of return.

Starting
age              11%            15%
------------------------------------
18           $2,435,495     $9,486,965
28             $845,965     $2,334,995
38             $286,147       $567,138
48              $89,002       $130,150

You can see how important it is to start early.  Also, many of the BTD strategies suggest that it's possible to beat the 15% per year.

Good luck.
F.Bull


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Author: FoolishBull One star, 50 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3050 of 76421
Subject: Re: social security Date: 4/26/1998 2:51 PM
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[[Hi..Im 18 and Im going to start investing for my
retirement...Im curious tho..seeing Im paying a lot of
social sec. tax, and I know I won't see a penny in
about 2040 when I come around to retirement..but is it
possible to divert the money I pay into the government
and put it into some type of retirement account? Any
type..as long as I have some money to look forward
to...]]


Superr,


Regarding SS, I don't have anything to add except
TMF2Aruba started a discussion in the "fools and their
money" message board. See
http://boards.fool.com/Message.asp?id=1040007000287001&sort=id

I think it is great that you are getting Foolish early
since the next 10 to 20 years can make a big difference
in your bottom line when you retire.

Say you open a self-directed IRA account and invest
2000 at the end of each year until retirement (assume
65). Here's how your bottom line could change
depending on the age you start investing and your rate
of return.


Starting
age 11% 15%
------------------------------------
18 $2,435,495 $9,486,965
28 $845,965 $2,334,995
38 $286,147 $567,138
48 $89,002 $130,150

You can see how important it is to start early. Also,
many of the BTD strategies suggest that it's possible
to beat the 15% per year.


Good luck.
F.Bull

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