Scary scary stuff. Social Security out > in...

[Moliere]

So the more money you put in to SS the more you get in your Gov pension? IE byu71 who has been at the cap will get more money than the guy making half the cap? I always thought everybody got the same disbursement amounts.

It works somewhat like a pension plan, although SS calls it the Primary Insurance Amount, but I'd call it PItA . From Wikipedia....

A worker's retirement income benefit is based on his Primary Insurance Amount, or PIA. The PIA is the average of the highest 35 years of the worker's covered earnings (before deduction for FICA). Covered earnings in any year are limited by that year's Social Security Wage Base, the maximum earnings that could be subject to the OASDI portion of FICA payroll tax ($110,100 in 2012).[79] If the worker has fewer than 35 years of covered earnings, zeros are used to bring the total number of years of earnings up to 35. Years of covered work more than 2 years before the year the worker turns 62 are indexed upward to reflect the increase in the national wage via the average wage index (AWI) from the time at which the earnings were covered in the past to the value of the AWI two years before the worker turns 62 (which is the most recent year available at the date the worker turns 62). One-twelfth of this 35-year average is the average indexed monthly earnings (AIME). The PIA then is 90 percent of the AIME up to the first (low) bendpoint, and 32 percent of the excess of AIME over the first bendpoint but not in excess of the second (high) bendpoint, plus 15 percent of the AIME in excess of the second bendpoint. Bendpoints designate the point at which the rates of return on a beneficiary's AIME change.[80][81] In 2008, the bendpoints for calculating the PIA are a change from 90% to 32% at $711 and a change to 15% at $4,288.[81][82] This PIA is then adjusted by automatic cost-of-living adjustments annually starting with the year the worker turns 62. Similar computations based on career average earnings determine disability and survivor benefits. These alternate computations average less years of earnings when the worker dies or is disabled before age 62 and use different base years for the inflation adjustments.

[Indy Coug]

http://globalpublicsquare.blogs.cnn....ty/?hpt=hp_bn2

[byu71]

So the more money you put in to SS the more you get in your Gov pension? IE byu71 who has been at the cap will get more money than the guy making half the cap? I always thought everybody got the same disbursement amounts.

It was always my understanding you got back out in proportion to what you put in.

I have always thought the program was a government "forced retirement plan". It could also be compared to a company pension plan I guess, but in those pension plans the employee's didn't put any of their own money in.

This is why I have always objected to calling it a tax. When I am taxed, I do not have claim on anything specifically from the government.

Does someone know if SS always was set up to pay additional benefits beyond retirement. For instance if someone pays into the system and dies, aren't his wife and kids allowed to collect SS and isn't the amount far beyond what he put in? Has this always been the case from the beginning?

[MarkGrace]

What happened to Statman?

[wuapinmon]

End them both for anyone who is not destitute. Keeping charging the taxes for the next 20 years, and then let's be done with the whole mess.

[byu71]

End them both for anyone who is not destitute. Keeping charging the taxes for the next 20 years, and then let's be done with the whole mess.

I can go along with you if you define those who are worth $5million or less as "the destitute". Anyone who is worth over $5million should just consider the $500 thousand or more he/she has paid into the system as a really bad investment.

It also will be a warning to future generations to NEVER stand for a government forced retirement program.

[Paperback Writer]

End them both for anyone who is not destitute. Keeping charging the taxes for the next 20 years, and then let's be done with the whole mess.

I somewhat agree. However, that approach punishes people who do save for retirement and make the associated sacrifices.

[creekster]

End them both for anyone who is not destitute. Keeping charging the taxes for the next 20 years, and then let's be done with the whole mess.

This will merely incentivize people on the margin to qualify as destitute (however you define that) rather than provide for their own support.

[byu71]

End them both for anyone who is not destitute. Keeping charging the taxes for the next 20 years, and then let's be done with the whole mess.

How about this novel idea which I have proposed before.

Social Security knows how much they have in assets, US government bonds.

They know how much each person has paid into the system.

They, like you said, announce they are terminating the program as of July 1st, 2012.

It is simple, they subtract the payments they need to make from now until July 1st from the value of the Treasury bonds.

They then figure a percentage ownership of those bonds based on the amount each person has paid into the system.

Whatever that percentage is, pay out the money or issue the Treasury bonds to each individual.

The destitute can get their money from other government agencies. SS is a retirement program not a welfare program.

[Indy Coug]

The government needs to transition away from a pay-as-you-go system.

[creekster]

How about this novel idea which I have proposed before.

Social Security knows how much they have in assets, US government bonds.

They know how much each person has paid into the system.

They, like you said, announce they are terminating the program as of July 1st, 2012.

It is simple, they subtract the payments they need to make from now until July 1st from the value of the Treasury bonds.

They then figure a percentage ownership of those bonds based on the amount each person has paid into the system.

Whatever that percentage is, pay out the money or issue the Treasury bonds to each individual.

The destitute can get their money from other government agencies. SS is a retirement program not a welfare program.

I would support that idea.

[byu71]

The government needs to transition away from a pay-as-you-go system.

You are pretty sharp at being able to find out information. I am being serious here.

I found out there are $2.5 trillion dollars worth of Treasury bonds Social Security hold.

Every so often we all get information on our own SS. It shows how much we have paid into the system so far.

I wonder if you or anyone can find out how much the total of current people in the system have paid in as of now.

[TripletDaddy]

I wonder how many people from Gen X or Y were actually planning on Social Security as a serious financial resource during retirement? Since I have been in the work force, I have been operating under the assumption that I would get nothing, anyway.

[Indy Coug]

I wonder how many people from Gen X or Y were actually planning on Social Security as a serious financial resource during retirement? Since I have been in the work force, I have been operating under the assumption that I would get nothing, anyway.

SS is my grandkid Christmas/Birthday present fund. If it's still around, they get presents. If it isn't, they get phone calls from my condo in Maui.

[creekster]

I wonder how many people from Gen X or Y were actually planning on Social Security as a serious financial resource during retirement? Since I have been in the work force, I have been operating under the assumption that I would get nothing, anyway.

I think it is unlikely there would ever be the political will to eliminate it entirely. I think it is more likely that benefits are curtailed dramatically, contributions are increased substantially and eligibility is tightened significantly. That might result in you getting nothing, but only because you are a successful guy.