Social Security - Exhausted By 2037?

[stebo]

I saw on the news today that Social Security will now be broke (out of money) by 2037. So every paycheck that I put in that 6.7% is going out immediately (to my parents). You know - there was a guy that I voted against back in 2000... but I sure wish that his "lock box" would have caught on and our tax structure would have stayed the same. I can't stand that I will not get the same benefit out of the program that the last 3 or 4 generations have. What is the solution to the Baby Boom dilemma? Raise the amount we put into it? Raise the cap that is taxed (I think it currently only taxes the first $80K for a single person). Or should the age be raised to like 70? Or a combination of all? Social Security is not a perfect system but is something that is really important for our seniors... Your thoughts?

By the way, the sooner we get people working the better - those are tax payers that can contribute more to the pot.. Unemployment numbers have dropped to the lowest level in 6 quarters as of today's latest report. Thank god the economy is slowly turning around.

[FirefightnRick]

I saw on the news today that Social Security will now be broke (out of money) by 2037. So every paycheck that I put in that 6.7% is going out immediately (to my parents). You know - there was a guy that I voted against back in 2000... but I sure wish that his "lock box" would have caught on and our tax structure would have stayed the same. I can't stand that I will not get the same benefit out of the program that the last 3 or 4 generations have. What is the solution to the Baby Boom dilemma? Raise the amount we put into it? Raise the cap that is taxed (I think it currently only taxes the first $80K for a single person). Or should the age be raised to like 70? Or a combination of all? Social Security is not a perfect system but is something that is really important for our seniors... Your thoughts?

By the way, the sooner we get people working the better - those are tax payers that can contribute more to the pot.. Unemployment numbers have dropped to the lowest level in 6 quarters as of today's latest report. Thank god the economy is slowly turning around.

Were you not FOR Obamacare? If so, why the sudden concern about our seniors, now?

Rick

Edited March 25, 2010 by FirefightnRick

[FirefightnRick]

Wall Street Journal: ObamaCare, Day One

Democrats dragged themselves over the health-care finish line in part by repeating that voters would like the plan once it passed. Let's see what they think when they learn their insurance costs will jump right away.

Even before President Obama signed the bill on Tuesday, Caterpillar said it would cost the company at least $100 million more in the first year alone. Medical device maker Medtronic warned that new taxes on its products could force it to lay off a thousand workers. Now Verizon joins the roll of businesses staring at adverse consequences.

In an email titled "President Obama Signs Health Care Legislation" sent to all employees Tuesday night, the telecom giant warned that "we expect that Verizon's costs will increase in the short term." While executive vice president for human resources Marc Reed wrote that "it is difficult at this point to gauge the precise impact of this legislation," and that ObamaCare does reflect some of the company's policy priorities, the message to workers was clear: Expect changes for the worse to your health benefits as the direct result of this bill, and maybe as soon as this year.

Mr. Reed specifically cited a change in the tax treatment of retiree health benefits. When Congress created the Medicare prescription drug benefit in 2003, it included a modest tax subsidy to encourage employers to keep drug plans for retirees, rather than dumping them on the government. The Employee Benefit Research Institute says this exclusion—equal to 28% of the cost of a drug plan—will run taxpayers $665 per person next year, while the same Medicare coverage would cost $1,209.

In a $5.4 billion revenue grab, Democrats decided that this $665 fillip should be subject to the ordinary corporate income tax of 35%. Most consulting firms and independent analysts say the higher costs will induce some companies to drop drug coverage, which could affect about five million retirees and 3,500 businesses. Verizon and other large corporations warned about this outcome.

Rick

Edited March 25, 2010 by FirefightnRick

[MeanGreenTexan]

My generation is screwed... Maybe the rapture will occur before I retire?

[keith]

I saw on the news today that Social Security will now be broke (out of money) by 2037. So every paycheck that I put in that 6.7% is going out immediately (to my parents). You know - there was a guy that I voted against back in 2000... but I sure wish that his "lock box" would have caught on and our tax structure would have stayed the same. I can't stand that I will not get the same benefit out of the program that the last 3 or 4 generations have. What is the solution to the Baby Boom dilemma? Raise the amount we put into it? Raise the cap that is taxed (I think it currently only taxes the first $80K for a single person). Or should the age be raised to like 70? Or a combination of all? Social Security is not a perfect system but is something that is really important for our seniors... Your thoughts?

By the way, the sooner we get people working the better - those are tax payers that can contribute more to the pot.. Unemployment numbers have dropped to the lowest level in 6 quarters as of today's latest report. Thank god the economy is slowly turning around.

This is another example of what happens when people are deluded into thinking that they do not need to care for themselves...that someone else (the government) will do that for them. I think it's actually 7.5% and your employer chips in another 7.5%. Too bad that is not in some self-directed account that you own/control rather than the government. When planning for your golden years, do not count on anything from Social Security (which was supposed to be a safety net).

I read (or heard) somewhere that some of the better looking unemployment numbers were do to some starting to fall off the count because they exhausted unemployment benefits or something like that. I don't put a lot of stock in what our government tells us these days.

Keith

[keith]

This is another example of what happens when people are deluded into thinking that they do not need to care for themselves...that someone else (the government) will do that for them. I think it's actually 7.5% and your employer chips in another 7.5%. Too bad that is not in some self-directed account that you own/control rather than the government. When planning for your golden years, do not count on anything from Social Security (which was supposed to be a safety net).

I read (or heard) somewhere that some of the better looking unemployment numbers were do to some starting to fall off the count because they exhausted unemployment benefits or something like that. I don't put a lot of stock in what our government tells us these days.

Keith

Pffft...I knew I should have looked it up. Social Security tax is 6.2%. Medicare is another 1.45%. Employer has to kick in a matching amount. The key difference is SS tax is only on the first $106K of income while Medicare keeps going.

Keith

[eeally]

Maybe if we stop paying for the seniours all together then we will have some left over for us!!!!! I mean why did they not save for this. Why am I footing the bill?

Abolish Social Security before it brings us 30 somethings down!!!! If we could keep illegals out of the country then senior's could start washing dishes and mowing lawns instead of playing with grandchildren volunteering and mentoring. And no cable news for seniors who cant afford it. Why should they get fox news on my dime?

[untbowler]

Maybe if we stop paying for the seniours all together then we will have some left over for us!!!!! I mean why did they not save for this. Why am I footing the bill?

Abolish Social Security before it brings us 30 somethings down!!!! If we could keep illegals out of the country then senior's could start washing dishes and mowing lawns instead of playing with grandchildren volunteering and mentoring. And no cable news for seniors who cant afford it. Why should they get fox news on my dime?

All of Congress is to blame for the Social Security debacle, they had SS in a lock box then got greedy for their little pet programs/projects and got their hand into the cookie jar and never let loose. Just pathetic actions from every party involved regardless of leanings.

[yyz28]

All of Congress is to blame for the Social Security debacle, they had SS in a lock box then got greedy for their little pet programs/projects and got their hand into the cookie jar and never let loose. Just pathetic actions from every party involved regardless of leanings.

This plus 1000.

[MeanGreenTexan]

All of Congress is to blame for the Social Security debacle, they had SS in a lock box then got greedy for their little pet programs/projects and got their hand into the cookie jar and never let loose. Just pathetic actions from every party involved regardless of leanings.

You simply can't fully trust any of them.

[yyz28]

What is the solution to the Baby Boom dilemma? Raise the amount we put into it? Raise the cap that is taxed (I think it currently only taxes the first $80K for a single person). Or should the age be raised to like 70? Or a combination of all? Social Security is not a perfect system but is something that is really important for our seniors... Your thoughts?

Privatize social security or disband it all together. We should pay for seniors and people who are currently, say 40 and younger, have to pay in with the understanding that we'll never get anything out, and then we have to be responsible for taking care of our own retirement.

I would not be for screwing seniors who are close enough to retirement to have been counting on Social Security, but I'm willing to sacrifice so that my kid and grandkid's generation don't get stuck in the same boat we are.

Social Security was doomed the minute that Congress and Politicians of both parties started putting Social Security tax revenue into the general fund.

By the way, the sooner we get people working the better - those are tax payers that can contribute more to the pot.. Unemployment numbers have dropped to the lowest level in 6 quarters as of today's latest report. Thank god the economy is slowly turning around.

Look at unemployment vs the number unemployed. Unemployment is going down largely not because private jobs where people pay into Social Security are on the rise, but rather because A. they are no longer searching for work or have run out of unemployment benefits and thus aren't being reported (like folks under 65 who are looking for work and WANT a job, but just aren't counted because they are old enough to retire) or B. are taking government jobs which are the only type of job on the incline. Government employees by and large don't pay into Social Security, rather into their own private pension funds.

[stebo]

Rick, serious question - not trying to be a jerk. When I taught school for DISD (that socialist property known as public education) we put our money into the Teacher's Retirement Fund and were exempt from Social Security. Is that the rule for all government employees? Just curious how that works for firemen.

And I have never been a fan of this bill. Any reform short of a single payer system or at the minimum, a public option - is just regulation. The insurance companies and drug makers were the biggest lobbyists FOR this bill because they will make some good bottom lines off of this crap.

The only thing that passed on Friday was the right to buy insurance... from a for profit insurance company... How sad is it that we had to pass a law for that in a civilized country?

NOW - Let's go shoot out some windows and tea bag one another, yee haw!

[TheTastyGreek]

Rick, serious question - not trying to be a jerk. When I taught school for DISD (that socialist property known as public education) we put our money into the Teacher's Retirement Fund and were exempt from Social Security. Is that the rule for all government employees? Just curious how that works for firemen.

From first hand experience, no.

I worked for a city, and we had an alternate retirement plan but it didn't affect our social security benefits (for anyone who had logged time in a private sector job that paid into Social Security).

Then, I went to work for a school district, and the benefits system you pay into (TRS) actively cuts into your Social Security payout. It was a big point of contention for a lot of the folks at the campus where I worked, because many of them had spent 20 or more years in the private sector before going into teaching, and every year they spent teaching and paying into TRS also had the side effect of cutting down their future Social Security benefits.

Having worked for a municipal government, for a Texas ISD, and for a number of private sector employers... That's been my experience.

[GrayEagle]

All that said that Congress "robbed" Social Security for their pet projects are right. My employers and I paid into the fund for more than 50 years and had it been invested there would have been far more than I am getting now in return.

I heard that the average SS payment is just under $1000 per month. Had that money been placed in an annuity the payback would have been about $2,300 per month. I'm sorry that you have to pay but the oldtimers have been robbed also.

I read of a great solution that was proposed quite some time ago but ignored by Congress. All I can remember was that it was proposed by a black professor at Davis & Elkins College and it was something like this:

Those fifty and over continue under social security. The contribution of those thirty to fifty would be divided something like 60-40 between SS and an annuity. Those under thirty would purchase an annuity only (they would lose what they have paid in). Each person would have his own account and would receive an annual statement. The account could not be touched until retirement age was reached. The government would only be involved in an oversight capacity. I know, that would be totally out of the question with the progressives that are in power today but it would have cured a lot of ills had it been done when we had the chance.

[stebo]

All that said that Congress "robbed" Social Security for their pet projects are right. My employers and I paid into the fund for more than 50 years and had it been invested there would have been far more than I am getting now in return.

I heard that the average SS payment is just under $1000 per month. Had that money been placed in an annuity the payback would have been about $2,300 per month. I'm sorry that you have to pay but the oldtimers have been robbed also.

I read of a great solution that was proposed quite some time ago but ignored by Congress. All I can remember was that it was proposed by a black professor at Davis & Elkins College and it was something like this:

Those fifty and over continue under social security. The contribution of those thirty to fifty would be divided something like 60-40 between SS and an annuity. Those under thirty would purchase an annuity only (they would lose what they have paid in). Each person would have his own account and would receive an annual statement. The account could not be touched until retirement age was reached. The government would only be involved in an oversight capacity. I know, that would be totally out of the question with the progressives that are in power today but it would have cured a lot of ills had it been done when we had the chance.

I actually think that is a great idea. How do annuities work? Would that mean the money was in the market? How safe would that be?

[stebo]

From first hand experience, no.

I worked for a city, and we had an alternate retirement plan but it didn't affect our social security benefits (for anyone who had logged time in a private sector job that paid into Social Security).

Then, I went to work for a school district, and the benefits system you pay into (TRS) actively cuts into your Social Security payout. It was a big point of contention for a lot of the folks at the campus where I worked, because many of them had spent 20 or more years in the private sector before going into teaching, and every year they spent teaching and paying into TRS also had the side effect of cutting down their future Social Security benefits.

Having worked for a municipal government, for a Texas ISD, and for a number of private sector employers... That's been my experience.

Thanks for the answer. I get the feeling that the Texas Education System does that to get out of matching their employee's contributions. Good way to keep down costs for the system as long as the retirement fund is properly managed.. Appreciate the insight.