How to Fix Social Security

[cpayne5]

Originally Posted by mheisig

The whole concept of "let me give my money to the government so they can manage it for the next 30-40 years at which point they'll give it back to me a little bit a time" just never sat well with me.

I don't even factor SS into my retirement planning - as far as I'm concerned the entire thing is a farce. Preparing for retirement is the individual's responsibility, not the governments.

I think you're about the same age as me (I'm 25). I am doing the same thing. I pretty much think of my SS contributions as money I'll never see again.

There has to be a more efficient and fair way to do this, but I don't know what it is. I share That Guy's line of thinking at this point.

[Schneed10]

Originally Posted by firstdown

You really think they are earning 3-5% on money that they have allready spent? Can I get in on that programe! If finacial institutions did with their customers money what the goverment has done with the tax payers they would all be in jail.

Money they've already spent? Whatchu talkin bout, Willis?

[dmek25]

schneeds answer is spot on. the only problem is that the govt feels the need to dip into this program whenever they run into funding problems. lets go to the Gore lock-box( im sure this will get some response)

[mheisig]

Originally Posted by Schneed10

Philosophically, I agree that the government should just stay the hell away and not have a social security program at all. It should be up to us as individuals as to how we want to plan for retirement.

But from a pragmatic standpoint, this is unrealistic. Too many Americans will use that money for other things, failing to save enough for themselves. They'll then be forced to remain in the workforce until they're 80 or dead, which will take up more jobs, leaving fewer jobs for those under 65, resulting in much higher unemployment rates and much lower productivity and hence GDP. Not having some sort of organized retirement system would be a social and economic disaster.

But what needs to change is the rate of efficiency the government gets from our money. Right now they sock it away in the Social Security trust funds, and earn 3-5% on it. That barely outpaces inflation. A big chunk of that money needs to get invested in the stock market, corporate bonds, commercial paper, real estate trusts, and international investments. Just by making this change, the forecasts for social security's solvency would be nearly 100% healthy, simply because the rate of return on those investments is so much better than what the government is currently investing in.

I mean think about it, if Peter Lynch, Warren Buffett, Bill Miller and Joel Tillinghast can become some of the best investment minds as corporate guys, why can't the US government hire one of the best to help manage the money?

I don't care if you privatize or not. The bottom line is we need a much better return on investment from the social security trust, otherwise this predicament is only going to get worse. It's actually shameful that we haven't done this ages ago.

So it's the government's job to make sure irresponsible people don't experience the consequences of their irresponsible actions? More precisely, it's MY money that has to ensure that these people never face the consequences of their irresponsible actions.

[Schneed10]

Originally Posted by mheisig

So it's the government's job to make sure irresponsible people don't experience the consequences of their irresponsible actions? More precisely, it's MY money that has to ensure that these people never face the consequences of their irresponsible actions.

Correction, it's your money that's serving as an INVESTMENT in your own, and the country's, future to ensure that your grandchildren have the same decent shot at a decent paying job just as you do now. Because if you don't make that investment, your grandkids will find it very hard to find work.

Such is the way economics works. Sometimes making investments isn't about gaining a return on investment, sometimes it's about avoiding losses.

[mheisig]

Originally Posted by Schneed10

Correction, it's your money that's serving as an INVESTMENT in your own, and the country's, future to ensure that your grandchildren have the same decent shot at a decent paying job just as you do now. Because if you don't make that investment, your grandkids will find it very hard to find work.

Such is the way economics works. Sometimes making investments isn't about gaining a return on investment, sometimes it's about avoiding losses.

How does paying for someone else's future retirement ensure that my grandkids can find a job 40 years from now?

I'm not being facetious, I honestly want to know.

[firstdown]

Originally Posted by Schneed10

Correction, it's your money that's serving as an INVESTMENT in your own, and the country's, future to ensure that your grandchildren have the same decent shot at a decent paying job just as you do now. Because if you don't make that investment, your grandkids will find it very hard to find work.

Such is the way economics works. Sometimes making investments isn't about gaining a return on investment, sometimes it's about avoiding losses.

Hey you may want to send that line to the Dem. party. Its not about saving for your future its about jobs for your grandkids and you don't want to starve your grandkids. You also assume that there would be a flood of people having to work longer in life. I could retire about 6 to 7 years earlier and I bet over half of Americans could retire at an earlier time.

[Schneed10]

Originally Posted by mheisig

How does paying for someone else's future retirement ensure that my grandkids can find a job 40 years from now?

I'm not being facetious, I honestly want to know.

Too many Americans will fail to save enough for themselves. They'll then be forced to remain in the workforce until they're 80 or dead, which will take up more jobs, leaving fewer jobs for those under 65, resulting in much higher unemployment rates and much lower productivity and hence GDP. Not having some sort of organized retirement system would be a social and economic disaster.

From a philosophical standpoint, I'm 100% in agreement with you. But if there's no program to support the working poor in old age, they'll stay in the workforce longer and longer.

[Schneed10]

Originally Posted by firstdown

Hey you may want to send that line to the Dem. party. Its not about saving for your future its about jobs for your grandkids and you don't want to starve your grandkids. You also assume that there would be a flood of people having to work longer in life. I could retire about 6 to 7 years earlier and I bet over half of Americans could retire at an earlier time.

Retire earlier without a social security program in place? I guess you're assuming instead of paying those taxes, you'd sock the money away in retirement funds allowing you to earn a better rate of return than you'd get by paying into social security?

Firstdown, you really need to explain yourself better. You leave me guessing at what you're talking about.

If that's what you mean, the number of working poor staying in the workforce well beyond 65 will greatly outnumber those who can retire early, I can guarantee you that. American citizens are not a financially savvy group.

[firstdown]

Originally Posted by Schneed10

Too many Americans will fail to save enough for themselves. They'll then be forced to remain in the workforce until they're 80 or dead, which will take up more jobs, leaving fewer jobs for those under 65, resulting in much higher unemployment rates and much lower productivity and hence GDP. Not having some sort of organized retirement system would be a social and economic disaster.

From a philosophical standpoint, I'm 100% in agreement with you. But if there's no program to support the working poor in old age, they'll stay in the workforce longer and longer.

Well if the working poor keeps working longer in the job that made them pore tha all the low paying jobs will be taken so they will have to find better jobs. So it really solves two problems.

[firstdown]

Originally Posted by Schneed10

Retire earlier without a social security program in place? I guess you're assuming instead of paying those taxes, you'd sock the money away in retirement funds allowing you to earn a better rate of return than you'd get by paying into social security?

Firstdown, you really need to explain yourself better. You leave me guessing at what you're talking about.

If that's what you mean, the number of working poor staying in the workforce well beyond 65 will greatly outnumber those who can retire early, I can guarantee you that. American citizens are not a financially savvy group.

First off I've never said doing away with the 12% that people and employees but into SS. I say let people decide how to invest the money or let local goverment handle the issue. I just know that our current system doe not work. If you can look at these chart and say SS is the best way then there's no reason to discuss this.Chart 4 [Mackinac Center for Public Policy]

Also nothice that they retire making MORE money than when they worked.

[Schneed10]

Originally Posted by firstdown

Well if the working poor keeps working longer in the job that made them pore tha all the low paying jobs will be taken so they will have to find better jobs. So it really solves two problems.

How can a job make someone poor??? Even if it pays $7.50 an hour, it still gives you more money than you would otherwise have if you were unemployed.

It doesn't solve anything, you're making no sense. If more low-level jobs are taken up by the working poor in their old age, there will be fewer low-level jobs for younger people. They will either be squeezed out of a job altogether, or they'll have to seek a higher-level white collar job. Unless they're college graduates, which most of the working poor are NOT, they will have a significantly harder time finding a job that matches their skill level.

Plus, employers will realize that they can hire a cashier who's 24 and get rid of the geezer who's 76. The 76 year old will then be out on the street seeking a job, and tell me who will prefer him over a younger person?

It will cause absurd problems in the job market. I can't figure out what the hell you're talking about.

[Schneed10]

Originally Posted by firstdown

First off I've never said doing away with the 12% that people and employees but into SS. I say let people decide how to invest the money or let local goverment handle the issue. I just know that our current system doe not work. If you can look at these chart and say SS is the best way then there's no reason to discuss this.Chart 4 [Mackinac Center for Public Policy]

Also nothice that they retire making MORE money than when they worked.

If that's your stance, then you and I are in complete 100% agreement.

I just took issue with your suggestion that going without a program entirely wouldn't be a problem economically down the road.

[firstdown]

Originally Posted by Schneed10

How can a job make someone poor??? Even if it pays $7.50 an hour, it still gives you more money than you would otherwise have if you were unemployed.

It doesn't solve anything, you're making no sense. If more low-level jobs are taken up by the working poor in their old age, there will be fewer low-level jobs for younger people. They will either be squeezed out of a job altogether, or they'll have to seek a higher-level white collar job. Unless they're college graduates, which most of the working poor are NOT, they will have a significantly harder time finding a job that matches their skill level.

Plus, employers will realize that they can hire a cashier who's 24 and get rid of the geezer who's 76. The 76 year old will then be out on the street seeking a job, and tell me who will prefer him over a younger person?

It will cause absurd problems in the job market. I can't figure out what the hell you're talking about.

Maybe your on to something. Like finding higher paying jobs and maybe staying in school a little longer and if they decide to quite school then that is really their decision.

[firstdown]

Originally Posted by Schneed10

If that's your stance, then you and I are in complete 100% agreement.

I just took issue with your suggestion that going without a program entirely wouldn't be a problem economically down the road.

Funny how we could discuss this and it took that long to figure we where on the same page.