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Put all those factors together and it gets fairly straightforward to get to a lousy expected return rate from Social Security for many people fairly new to the workforce. Add some less than idealized life expectancy assumptions to the mix (ie: both my grandfathers died around age 70), and the calculated expected return rates from Social Security for higher income younger workers can get very negative, very quickly.

Please remember, Social Security isn't an investment with a rate of return. It's an insurance policy protecting against longevity, spousal death, and injury. Old Age, Survivor's and Disability Insurance is the true name of Social Security. One doesn't calculate the ROI on other forms of insurance, life, auto, liability, or fire. And like other forms of insurance, those who pay the premium and don't collect subsidize those who do.

Rat's I lost money on my life insurance policy. I should have died sooner.
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