The Motley Fool Discussion Boards Previous Page Investing/Strategies / Retirement Investing URL:  https://boards.fool.com/16-years-is-192-months-but-your-citation-does-29031494.aspx Subject:  Re: Means Testing SS Date:  1/14/2011  4:49 PM Author:  Goofyhoofy Number:  68251 of 101033 1.6 years is 19.2 months. But your citation does not give either category as an absolute, so the question you asked me to perform cannot be calculated from the information you supplied.If the numbers are 10 years (120 months - 1908.05*120 = \$228,966) versus 11.6 years (139.6 months - \$2,555.15*139 = \$356,699) [collect 1.56x more while paying 1.94x more] you get a much different answer than if the numbers are 2 years (24 months - 1908.05*24 = \$45,793.20) versus 3.6 years (43.6 months - \$2,555.15*43.6 = \$111,405). [collect 2.43x more while paying only 1.94x more].I'm not sure I'm understanding you here. If the additional life is 19.2 months, then we can calculate the additional payments. At \$2,555 per month, Mr. HighIncome gets roughly an additional \$49,000 over Ms. LowIncome, who is dead.What did Mr. HighIncome have to pay for this? Well, here it gets squishy and possibly contentious. I'll try to make this simple, although clearly every case will be different.I'm going to say Mr. HighIncome started off like most of us, making \$20,000 a year, and added \$20,000 to that every decade thereafter. (I think most people didn't start off in their 20's making \$100,000 a year, although I'm sure a few did.) [This looks to me like someone who climbs the middle-management ladder.]So Mr. HighIncome looks like this:Age. . Salary. . . . SS taxes paid20-30 \$20,000/yr = \$1200/yr SStax = \$12,000 for the decade30-40 \$40,000/yr = \$2400/yr SStax = \$24,000 for the decade40-50 \$60,000/yr = \$3600/yr SStax = \$36,000 for the decade50-60 \$80,000/yr = \$4800/yr SStax = \$48,000 for the decade60-65 \$100000/yr = \$6000/yr SStax = \$30,000 for the half decadeHe pays a total of \$150,000 in SS taxes across his earning lifetime.Now. Ms. LowIncome also pays SS tax. I'm going to say she makes \$20,000 for 20 years, and perhaps \$30,000 for her final 25 years. She works at WalMart or something, OK?20-40 \$20,000/yr = \$1200/yr SStax = \$24,000 for two decades40-65 \$30,000/yr = \$1800/yr SStax = \$45,000 for 25 yearsShe pays a total of \$69,000 in SS taxes across her earning lifetime.So the difference is \$81,000 they have paid in (His \$150,000 minus her \$69,000), less the \$50,000 that he gets in additional payments after Ms. LowIncome is dead, meaning the total difference across both lifetimes is \$30k. I guess I don't view that as egregious, although I'm sure some do.As has been noted by others in this thread (or elsewhere), the low income people are not getting rich on Social Security, quite the opposite.Furthermore, your cited source disagrees with your initial premise that SS is not a welfare program.I cannot help what a web page calls it. It wasn't designed as a "welfare" program, and by specifically excluding people who do not contribute in, it does not act as one - although I acknowledge there is some minor redistribution, depending on the case, the length of time, and a host of other variables. If my calculations are somehow wrong, or my assumptions wildly out of reality, please advise. ` ` Copyright 1996-2021 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us