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Author: Phoolish1 Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76420  
Subject: The Wisdom of Social Security Date: 6/5/1998 3:41 PM
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Today, in my local newspaper, there's an article about the unprecedented bipartisan agreement on the need to reform/shore up Social Security. At a national summit on retirement savings, Clinton noted ("decried", according to the article) that, overall, Americans are still spenders and not savers and called on the nation's political leaders to act on Social Security now, in the cradle of a strong economy.

It boggles my mind that our leaders continue to push the notion that individuals need to depend on a government more than 5 trillion dollar debt to save for them. That the general public seems to accept this is simply unbelievable.

I hope it's just politics. I hope they're just trying to court votes. I hope that behind closed doors cooler heads are noticing that despite gut wrenching drops, the stock market is the best investment vehicle we've got. I hope that in smokey back rooms, deals are being cut to phase out Social Security and expand the Roth IRA and add individual investment education programs. I hope Hillary is thinking about writing a sequel to "It Takes a Village" called "Teach a Man to Fish".

I fear that none of this is true.

Meager reassurance comes my way from the 20 and 30-somethings I see on the news who say "Depend on Social Security for my retirement?? You must be mad." These comments allow me to indulge a little and dream about the day a Social Security employee looks at a printout and says "Hey! Something must be wrong with the computer. It says that no one applied for benefits this week."

In this newspaper article, Al Gore is quoted as saying, "We must make sure that as America grows grayer, it also grows wiser about the future."

Al, I'm here to tell you, you're on the right track.
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Author: piz Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3592 of 76420
Subject: Re: The Wisdom of Social Security Date: 6/5/1998 4:00 PM
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Phoolish1 wrote:
<<Today, in my local newspaper, there's an article about the unprecedented bipartisan agreement on the need to reform/shore up Social Security...It boggles my mind that our leaders continue to push the notion that individuals need to depend on a government more than 5 trillion dollar debt to save for them. That the general public seems to accept this is simply unbelievable....>>

Social Security is, and always has been, a pyramid scheme. The best I can believe is that the people who created it were ignorant of that fact. The worst I can believe is that they were not.

Wise, indeed!

Piz

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Author: Tiggertoo One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3623 of 76420
Subject: Re: The Wisdom of Social Security Date: 6/6/1998 9:16 PM
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I think you have missed a major point here. It is not just Social Security. It is all social Plans. But the real problem is that the major political parties have learned that give away programs generate votes, and if you need votes, just accuse the other guy of getting tough on those programs.

That is the root of the problems, and unless we can get those fools to change their minds, we will never solve the problems of our country. I am not saying some people don't need these type programs, just that the way things are now is not acceptable.

Also, Al Gore and the rest of his co-hearts are just playing mind games; they don't want to lose the votes either, but they can buy your vote by making you think that they want to do something worthwhile.

Guess I am just a cynic. Too many years watching the mugwomps ( those that set on the fence with their mugs on one side and womps on the other).

TTFN...TiggerToo

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Author: phuzz One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3625 of 76420
Subject: Re: The Wisdom of Social Security Date: 6/6/1998 10:51 PM
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Greetings all,
Thought I'd pass on an observation regarding the following:
<But the real problem is that the major political parties have learned
that give away programs generate votes, and if you need votes, just accuse the
other guy of getting tough on those programs.>

"Politicians and diapers both need changing for the same reason"

Phool On,
PhuzzPhool

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Author: cindi Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3626 of 76420
Subject: Re: The Wisdom of Social Security Date: 6/6/1998 11:53 PM
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TiggerToo-You're not a cynic. Your right.

No one wants to give up the one little tiny program that benefits them. But they pay for it in the long run. al and his party talk about the surplus this year and are looking for new programs to spend it on. Much of this "windfall" is one time ROTH money. What is going to pay for these new programs next year??? If we don't get out of the "something for everyone" mentality we are going to sink ourselves.

Back to Retirement: If we wouldn't be penalized for saving, I'm sure a good number of people would get better at it. Rather than give tax breaks for savings income (unearned), I'm sure they will invent some kind of goofy (very expensive) nationwide educational program to teach people how to save. (As though our Government remembers how.)



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Author: Feorlen One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3667 of 76420
Subject: Re: The Wisdom of Social Security Date: 6/9/1998 12:58 PM
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>Meager reassurance comes my way from the 20 and 30-somethings I see on the news who say
> "Depend on Social Security for my retirement?? You must be mad."

I'm one of these people. I am planning my own retirement because I have no clue what is going to happen to Social Security. But I expect to at least get something, because I'm gonna be mighty pissed if I don't.

If Congress announces the end of the Social Security system and there is no provision for those who have paid in, I and many others will be taking up our torches and pitchforks for a lynching in Washington.

It's not like I *asked* for that money to be taken out of my pay every month. I could be investing it myself.

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Author: piz Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3673 of 76420
Subject: Re: The Wisdom of Social Security Date: 6/9/1998 2:00 PM
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Feorlen wrote:
<<>Meager reassurance comes my way from the 20 and 30-somethings I see on the news who say "Depend on Social Security for my retirement?? You must be mad."<

I'm one of these people. I am planning my own retirement because I have no clue what is going to happen to Social Security. But I expect to at least get something, because I'm gonna be mighty pissed if I don't.

If Congress announces the end of the Social Security system and there is no provision for those who have paid in, I and many others will be taking up our torches and pitchforks for a lynching in Washington.

It's not like I *asked* for that money to be taken out of my pay every month. I could be investing it myself.>>

Don't forget how the Ponzi scheme...er, I mean Social Security...works. You're not paying into a fund that acts as a retirement account for you. Your SS tax pays the current benefits of current retirees. Your benefits will be paid by those who are working when you're retired.

There's nothing that says you're due anything because you paid into the system. Just like a pyramid scam, you're dependent on those who join in after you to make their payments. Congress could easily say, "That's it, after 12/31/99 only those who are already eligible for benefits will ever be eligible. Nobody who would have become eligible after that date will receive anything, even if they retire on 1/1/00 and pay their SS tax right up to that date. We'll phase out the SS tax as those who are receiving benefits die out."

Granted, it would be suicidal for Congress to do that; pitchfork-weilding lynch mobs would be the best they would face. But there's no contract, explicit or implicit, saying that if you pay in you get something back out.

Piz

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Author: Phoolish1 Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3676 of 76420
Subject: Re: The Wisdom of Social Security Date: 6/9/1998 2:44 PM
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> I'm one of these people. I am planning my own retirement
> because I have no clue what is going to happen to Social Security.
> But I expect to at least get something, because I'm gonna be mighty pissed if I don't.
> [...]
> It's not like I *asked* for that money to be taken out of my pay
> every month. I could be investing it myself.

It sounds like you're mighty pissed already. (I don't blame you. I am, too.)

I hope you'll pardon me if I note that's it's precisely this kind of attitude that is perpetuating Social Security now. (Or more precisely, it's what's motivating our leaders to come up with all these wonderful ideas for saving SS.) We want SS purged but we also don't want to lose the money we've paid in. It's not going to work the way.

If I were given the option to end my participation in Social Security today under the conditions that I could not recover any of my past "contributions" and I could never receive any retirement benefits, I would do so in a heartbeat. (I'm 35.) I realize that older folks might not be willing to make such a trade-off. This is why any plan to abolish SS will require a very long phase out.

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Author: F00LnrMoney Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3682 of 76420
Subject: Re: The Wisdom of Social Security Date: 6/9/1998 3:29 PM
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>If I were given the option to end my participation in Social Security today under the conditions >that I could not recover any of my past "contributions" and I could never receive any retirement >benefits, I would do so in a heartbeat. (I'm 35.) I realize that older folks might not be willing to >make such a trade-off. This is why any plan to abolish SS will require a very long phase out.

At my salary,(not including bonuses, etc, which are also taxed out the wazoo) I pay 3925 annually into SS/Med.

Let's just take the 6.2% I pay into SS now, 3100.00 and see what kind of magic we can do with it --

Hmmm, 3100.00 annually, invested to gain a 12% rate of return (historical) for 30 years with 4% inflation:

CHA CHING!!!!!

432,427.00 if in a taxable account.
841,000.00 if invested tax-deferred or tax-exempt.

Yeah Phoolish1, I'm with you, I'd quit paying those taxes in a heartbeat too.

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Author: zother Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3696 of 76420
Subject: Re: The Wisdom of Social Security Date: 6/10/1998 9:42 AM
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How about as part of a phase out we let the government take our employer's contributions, as long as we get to put our portion in an individual account?

I would also gladly give up past contributions and future payments for this deal.

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Author: LasVegasFool One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3706 of 76420
Subject: Re: The Wisdom of Social Security Date: 6/10/1998 3:45 PM
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> Security now. (Or more precisely, it's what's >motivating our leaders to come up with all these
> wonderful ideas for saving SS.) We want SS purged but >we also don't want to lose the money
> we've paid in. It's not going to work the way.

There's only one realistic way to get rid of SS: Raise the retirement age to infinity, at perhaps 1 year later for every 4 or 5 years that pass.

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Author: TheOthermfa One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3766 of 76420
Subject: Re: The Wisdom of Social Security Date: 6/12/1998 7:08 PM
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I just did the calculation based on my (and my employers') actual contributions from 1958 thru 1997. Unfortunately I wasn't able to contribute $3100 all those years (1958 was $2), but nevertheless letting it all grow tax-deferred at a CGR of 11.6% results in a nest egg of [cha-ching, indeed!] $487,697, which should annuitize nicely to around $30,000 per year RIGHT NOW, and I'm only 57.

Of course, I have conveniently ignored widow and survivor benefits which I benefitted from during that period, so the total cost and total return are probably impossible to figure at this stage, but I sure know which I would pick if I had the choice.

Weaning people away from SS is mathematically easy but psychologically impossible, I imagine.

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Author: markr33 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3840 of 76420
Subject: Re: The Wisdom of Social Security Date: 6/17/1998 2:00 PM
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<<I'm one of these people. I am planning my own retirement because I have no clue what is going to
happen to Social Security. But I expect to at least get something, because I'm gonna be mighty pissed if I
don't.

If Congress announces the end of the Social Security system and there is no provision for those who have
paid in, I and many others will be taking up our torches and pitchforks for a lynching in Washington.

It's not like I *asked* for that money to be taken out of my pay every month. I could be investing it
myself.>>

Then be pissed ALREADY because they (congress) have taken away part of your benefits by taxing them if you have other earned income when drawing benefits !!!

Mark

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Author: Helter Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3841 of 76420
Subject: Re: The Wisdom of Social Security Date: 6/17/1998 4:28 PM
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Then be pissed ALREADY because they (congress) have taken away part of your benefits by taxing them if you have other earned income when drawing benefits !!!

Mark


While I agree with Mark for the most part, I think we should all do a little brain/mathematics exercise to set us a little at ease with Social Security Taxes.

Take your pay stub.

Add up all the different Tax lines, write a new line by hand on your stub called 'taxes', put the amount next to it. Cross out all the other taxes.

Guess what, taxes went up, FICA went away. Are we any happier? Do we now get to choose how much we are taxed and where it goes? Nope.

Personally, I've never volunteered to pay any tax - EVER. They are ALL involuntary, and taken with the threat of force/imprisonment - I'd call it armed robbery.

Fact, we can't stop it.

Do your best with what's left. Expect nothing from the government.

Helter Skelter - low expectations are the key to happiness(more pleasant surprises)

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