quote:

ORIGINAL: willbeurdaddy

quote:

ORIGINAL: Musicmystery

I also wonder how many of those screaming "bankruptcy" (and SS still has an almost 3 trillion dollar surplus--which the US borrowed) have ever read their SS benefits estimate?

Given what I've paid and what my employers paid (which, after all, was paid on my behalf, and is part of my compensation package) combined, and given what I and they will still pay in, whether I retire at 67 or 70, it will still take about ten years just to collect that money back. Then it's a matter of how long and whether I live past 77/80.

But wait--we haven't figured in any interest on all that money for decades! Even at modest rates, say, 5%, this would more than double that benefit pool. Now I'm at 87/90.

But wait! We haven't accounted for inflation yet--I'm getting back 21st century dollars for more more expensive 20th century payments. A 1980 dollar, for example, is worth $2.57 in 2009 dollars--and I've still got a ways to go until retirement! This again more than doubles the pool. Now I'm funded through age 107/110 plus.

And the same is true for you, as your benefits and payments are determined by the same percentages and formulas as mine.

That SS is going to run itself bankrupt is just bull. It doesn't matter how many workers there are per retirees. You paid for it. Collect it.

The underlying math is that a low paid unmarried worker, after taking into account inflation, life expectancy etc receives benefits that represent about a 2-5% rate of return on his contributions. If he's married that goes up to about 4-7%

Someone always earning at the SSWB, if unmarried, basically breaks even, if married receives a return of about 2-3%.

The failure of most articles that analyze the return is that they neglect the cost of spousal benefits and automatic disability benefit coverage.

quote:

ORIGINAL: Musicmystery

But you're talking about a different point.

Mine is that I'm not getting some unfunded government giveaway--I've paid for it, in full, and so has everyone else.

You are addressing the rate of return on an individual's investment. And sure, it pales next to my retirement account, no question. But it also serves a social need. The average American has negative savings. The average 50 year old has $50,000 saved--a pathetic amount. Society has to do something with these starving elderly. So we channel money into FICA to ensure they have some sort of retirement income at least (and hardly a bonaza--my estimated benefits are less than half my income, and I'm glad it will be just extra pocket change). Administrative costs are a need for safety are high here, so obviously that's going to eat into return.

It's still bullshit that SS is going bankrupt. All the money is there.