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URL:  https://boards.fool.com/goofyhoofy-thats-true-but-unless-you-want-my-29032097.aspx

Subject:  Re: Means Testing SS Date:  1/14/2011  9:50 PM
Author:  madbrain Number:  68259 of 95198

Goofyhoofy,

That's true. But unless you want my post to be 300,000,000 pages long, you have to deal with "averages." Some people will get screwed. Some people will make out handsomely. That's the way it is with annuities, life insurance, and lots of things in life.


One major difference is that social security taxes are mandatory for wage workers, but annuities and life insurance are entirely optional products that you can choose to purchase or not if they suit you.
I can't opt out of SS even though I don't think I will live past 60 and ever collect benefits. Even if I had a doctor make a statement to that effect, the government would not care. I have probably paid about $150k into the system already counting both employee and employer SS taxes. In my lifetime it will probably be over $300k, or even more, as the maximum SS taxable ceiling keeps getting increased, but not more than my income so far.

But I wouldn't say that I'm getting "screwed" I realize that SS is a welfare program that pays for current retirees however, and SS taxes are part of the price we pay for not putting our current elderly completely out on the street. I do certainly wish that :
a) all income was subject to social security taxes. Not just wage income. Even Warren Buffet has commented about this, the average tax rate on his secretary is higher than his own tax rate.
b) SS had some more flexibility, and that I had the opportunity to choose to take SS retirement benefits earlier, with reduced benefits, or perhaps a reduced benefit period (say, 10-20 years, vs lifetime). As it stands, the mimimum age to collect anything is 62 which I'm unlikely to attain. I'm sure I'm in an unusual situation, but I cannot be the only one.

That's also true, but I have always doubted that "the other half" is really yours, because if the government stopped collecting it, I seriously doubt the employers would just hand it over to the employees. When corporate tax rates went down, did you get a raise?


Neither the employee or employer SS taxes are technically your money.
There is nothing I can do to make the federal government return me the money I paid in SS taxes during my lifetime.
These funds go towards paying current retiree and disability benefits. Not towards your own benefits, which you may or may not ever collect, based on the ever-changing definition of social security eligibility.

When taxes go down, there are several options. The lowering of SS taxes for the year 2011 is part of the stimulus. I believe it is supposed to encourage employees to spend more and employers to hire more. I don't think it will likely have the intended effect.
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