The more significant difference between SS and a private fund is that you've got no legal claim to SS. It's a tax, and the gov't is under no legal obligation to pay you one dime back. See the U.S. Supreme Court case of Flemming v. Nestor. A private fund like Fidelity can't legally refuse to give you your money back, but the gov't can. What a fraud - it's no wonder liberals won't allow it to be a voluntary program.
The more significant difference between SS and a private fund is that you've got no legal claim to SS. It's a tax, and the gov't is under no legal obligation to pay you one dime back. See the U.S. Supreme Court case of Flemming v. Nestor. A private fund like Fidelity can't legally refuse to give you your money back, but the gov't can. What a fraud - it's no wonder liberals won't allow it to be a voluntary program.
A negative return over hundreds of thousands of dollars paid in over 45 years for a few hundred bucks a month for a few years?
Yep.
Yep.
umbrella39
Lifer
- Jun 11, 2004
- 13,816
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Gee, another person who thinks that SS is and always should be about what do I get for my dollar. Everyone knows you can make a lot more money elsewhere. Try and remember that SS is not just about paying old people off. SS also is in place to take care of children who have lost their parents, people who could NEVER work (not just people lose the ability to work after they have paid some into it), etc. It is not just about YOU and what you expect as your return. SS needs an enema, but we need SS.
techs
Lifer
- Sep 26, 2000
- 28,559
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Gee I guess its morons day here at ATOT.
Social Security has a huge return. Since the amount Social Security receives is pegged to salaries of workers.
And salaries go up over time.
Plus the money that the federal government borrows from the SS fund it pays interest on.
The only possible flaw to the plan would be if a President tried to radically cut taxes while increasing spending which would put the entire solvency of the US at risk.
Oh, wait, thats what BUSH is doing!!!
The problem is we can't trust the government to manage the money. When they get a surplus, they spend it elsewhere. When a deficit happens, which is projected to occur in 2017 and get worse as time goes on, we'll have 3 options:
1. More Taxes. Yeah, that'll fix the problem this time, we swear.
2. Reduce benefits. SS already is borderline poverty.
3. Reform the system so the fvcking government doesn't spend the money.
If we gradually went over to a private account system, the ownership of the money would be in the individual. The government would not be able to take it.
Of course, we wouldn't allow people to cash it out until retirement. We'd have to do some sort of price matching for people with less than 30k income. We'd have to restrict people from putting it into risky investments.
But in the end, every American would be getting more income if this happened.
To everyone that cries people could lose all their money to balanced mutual funds: BULLSHIT. Balanced mutual funds, since 1929, will multiply your investment by nearly 3x every decade. Any fluctuations are minor, and only go down about 10% temporarily.
1. More Taxes. Yeah, that'll fix the problem this time, we swear.
2. Reduce benefits. SS already is borderline poverty.
3. Reform the system so the fvcking government doesn't spend the money.
If we gradually went over to a private account system, the ownership of the money would be in the individual. The government would not be able to take it.
Of course, we wouldn't allow people to cash it out until retirement. We'd have to do some sort of price matching for people with less than 30k income. We'd have to restrict people from putting it into risky investments.
But in the end, every American would be getting more income if this happened.
To everyone that cries people could lose all their money to balanced mutual funds: BULLSHIT. Balanced mutual funds, since 1929, will multiply your investment by nearly 3x every decade. Any fluctuations are minor, and only go down about 10% temporarily.
You can do better than that. I think you're not factoring in compound interest, which as Einstein correctly said, it is the most powerful force in the universe. Max an Roth IRA starting when you're 20 and you should have at least 2 million by retirement. AT LEAST.
For example, put in a mere 4k into Vanguard Wellington in 1966. Today it would be worth nearly 300,000. You're investment nearly triples every decade. 3^4 = 81. 81*4,000 = 324,000.
http://flagship3.vanguard.com/VGApp/hnw...1&FundIntExt=INT&DisplayBarChart=false
Of courses SS has great returns in the past. All pyramid schemes have great returns if your on top.
Speaking of morons, how is recieving a large income due to income increases a "return"?
When the govt taxes me more is that a "return"?
techs
Lifer
- Sep 26, 2000
- 28,559
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You need to look up what a Pyramid scheme is. It sure isn't SS.
I guess you really don't understand that SS is part retirement plan, part insurance plan (it has to pay for everyone regardless how long they live).
SS is a financially and actuarilly sound program.
I'll take my 5-10 million dollars from personal investment as insurance, thanks. And I'm sure people with a 30k income would rather get 2 million as well. The government does not have fiscal dicipline.
Chances of me getting a poverty line SS in 2050: ?% Pretty low
Chances of aggressively investing into IRA, and 401k in my 20s and getting several million dollars: 99.9%
0.1% happens to be the chance of the US government falling.
techs
Lifer
- Sep 26, 2000
- 28,559
- 4
- 0
You CANNOT provide for your own retirement.
I proved it here:
http://forums.anandtech.com/messageview...atid=52&threadid=1854509&enterthread=y
Bullshit I can't. I'm a computer engineer. I expect a starting salary of about 60k.
If I invest 20k into 401k and get price matching during my 20s, and max IRAs, I will retire very easily.
In a private system we would price match people of low income, so that they can get a good return.
Techs sometimes cant grasp reality. 50% of people cant afford to save for retirement. Hmm what he fails to remember is ever one of those people have 14.6% of their income taxed into SS and if put into an individual account like the thrift program would generate way more income for retiree's than SS.
Well you proved me wrong lmao.
Should we setup a competition and see which one provides a better retirement?
I say a 50,000 a year job that never grows(unrealistic but easier to deal with).
Ill take the 14.6% of that for the next 40 years with a 10% return. You take the 14.6% of it and tell me what my SS payments will look like after 40 years.
Who thinks the SS payments will win?
Learn simple math, and the concept of annuities. Then come back to me.
Or, check out one of the many calculators on the net.
$7300 a year for 40 year gives $3.23 million.
Going down to a 3% return after inflation gives $550k.
Even under the unrealistic assumption that the $550k stops generating return from the age of 65 onward that still gives you 275 months of $2k payments. This becomes 324 months assuming a 1% return post 65.
You and Legend are not a fountain of knowledge on investing.
First of all you can only put in a max of 20% in a 401k, so Legend wanting to put in 20k is impossible. 2nd companies have been dropping off matching funds, my company will only match 25% up to 6% invested. I know Delphi in 2000 dropped all 401k matching and many other companies did the samething.
- Oct 28, 1999
- 62,484
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You can put in a total pre-tax contribution of $15,000 with a *total* contribution (after matches & profit sharing) of $42,000 or 100% of your income, whichever is less in 2006. You can also contribute $5000 to your Roth IRA on top of this.
There's $20,000 a year. And the contribution allowances will just continue to increase each year.
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