It seems to me that social security is going bust because the federal government continues to borrow from it and repay it with IOUS.However, as I understand the initial intent of social security, was to establish an account for each and every tax paying american to which the ss money that was withheld from his (and her) paycheck was to be deposited into his (her) own account and not into a general pot. When this person retired he would have his money to use toward his retirement. I do believe in allowing individuals to invest their money as they see fit--whether it is in equities, bonds, or whatever. However, under the current system, how can they do this when it is going into a general fund rather than individual accounts? So, the system is going to have to compute what each has contributed and put it into their own accounts first.
I*never* understood that money I contributed to social security would go into *my* own account. It has been shown in many tables that most people, especially those living today who draw on social security, draw *much* more OUT of the system than they ever put in.I understood that it was to go into a fund -- and everyone working would contribute to that fund -- and then come back out to SUBSIDIZE retirement for elderly people. But it was never meant to be anyone's *total* retirement income. It used to be that there were many workers contributing to pay the retirement of just one retiree. Nowadays it is down to only a couple of workers contributions per retiree -- which is part of the problem as to why the system is broke, and needs fixing.So there is never a time when the system will compute what you've put in and only give that back to you. You'd lose in the short run, and then have nothing.
It has been shown in many tables that most people, especially those living today who draw on social security, draw *much* more OUT of the system than they ever put in.I have heard the same statement but when I run the numbers with my assumptions (probably the problem) I get a different answer. I think that I should add my contribution and my employer's contribution and earn a market rate of return over my life. If I get more than this back then I got more than I "paid in". I will not get "more".Another way to look at this is if I put $2,000 a year in an IRA for 40 years ($80,000) and received more than $80,000 would you say I got more than I paid in or would you say I got what I deserved because I saved my money for the future instead of spending it today?I think when social security was started the idea was to build a fund for retirement. Just as you stated. The goal was changed by the government spending the surplus (instead of investing) and expanding the coverage to new areas and people who paid very little in compared to the benefits.I think that the social security plan should be closer to what you would expect if you made the payments to an insurance company. The insurance company would make a profit for their services and I would get a pension larger than social security pays now.
I don't think I have a quarrel with your assessment. The only point I was trying to make was that the money you put in to social security will *not* be all that is in your account come retirement -- there are investments the government makes, for better or for worse, and -- especially over the last 8-10 years you probably *could* have done much better than the government with that money.The problem of course is that not everyone would invest the money...or did invest the money ...and so the government, when they established social security, was trying to protect people from their own shortcomings. And the government isn't doing very well with it.Anyway....since I am one of those people who benefit from the system -- I draw disability benefits -- I'd better shut up while I'm ahead....
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