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Newly retired couples may lose $16,900/year in Social Security in 2033

usatoday.com

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Re: Newly retired couples may lose $16,900/year in Social Security in 2033

#61

Post by _DeadFred_ »

exabrial wrote: post #22

I wish i could just opt out of social security and invest the money myself. I'd pay the long term cap gains tax if this was an option, and I'd come out way ahead. The federal government can only mishandle money. Maybe we need two systems: 1. You may move to be a certified responsible saver. You inherit all risk. But you opt out of the taxes. You must prove retirements assets are being contributed to. 2. Mandatory sav…

I had responsible friends whose savings plans were destroyed in market crashes.

The whole point of social security is a safety net. There are plenty of cases where 'responsible savers' have needed that net. What do you propose, a second safety net to cover 'responsible savers' should something happen to them?

Re: Newly retired couples may lose $16,900/year in Social Security in 2033

#62

Post by _DeadFred_ »

jasongi wrote: post #18

Can someone explain the legal structures in place in the US that make Social Security "run out"? Because it just sounds like deliberate indirection put in place by the government to cut funding for pensions? In Australia, we have a universal, means-tested pension funded through consolidated revenue (i.e taxes). The pension can't "run out", because it is just a law that says that the government will pay you $X after y…

Since the 1980s Republicans have had a plan of 'starve the beast'. They intentionally structure government to be underfunded yet at the same time high debt and as dysfunctional as possible, so that they can point and say 'see, government doesn't work'. All because they are agenda over country/their fellow Americans.

We've had 40+ years with half of our politicians intentionally working to undermine our nation with intentionally bad policy.

Re: Newly retired couples may lose $16,900/year in Social Security in 2033

#63

Post by maxerickson »

JKCalhoun wrote: post #59

Imagine my surprise when I realized just a few months ago that I was now old enough to apply for social security. Younger, blue-collar-raised me thought I should hold out on applying for social security until I was 70 so as to get the largest monthly payout. Older, hopefully-wiser me (who has since learned about investing) applied for social security immediately and will stash the disbursements into an index fund unt…

Another way to look at it is that people who need the money early have the option. The guessing is just if you agonize about ending with an optimal payout.

Re: Newly retired couples may lose $16,900/year in Social Security in 2033

#64

Post by toast0 »

jasongi wrote: post #54
toast0 wrote: post #37

Earlier quoted context omitted.

Social security can 'run out', because it's setup with separate accounting. It's sort of designed that current year social security taxes pay for current year benefits ... in the 70s and 80s increases in taxes and decreases in benefits lead to a surplus of taxes collected which was held under the social security account. Since about 2009, income and costs have been pretty close and since about 2017, costs have consis…

> Closing social security off to new workers doesn't help, because current workers pay the bulk of current benefits You don't have to reduce the taxes. Just phase out the concept that you are paying into a retirement account and call a tax a tax. That means you don't calculate how much an individual receives based on the amount they input. In Australia, we started a sovereign wealth fund[1] to cover the future liabil…

> You don't have to reduce the taxes. Just phase out the concept that you are paying into a retirement account and call a tax a tax.

I don't know how you sell that.

"Hey, guess what whipersnappers? You all will still pay the line item for Old Age, Survivors and Disability Insurance, but you won't get anything from it. Thanks, -- Old People who get to spend 12.4% of your income"

Re: Newly retired couples may lose $16,900/year in Social Security in 2033

#65

Post by bluefirebrand »

Grombobulous wrote: post #60
bluefirebrand wrote: post #45

Earlier quoted context omitted.

> the mundanely pleasant reality There are a shocking number of people who do not experience anything resembling a mundanely pleasant reality Those of us who do are extremely fortunate

I completely recognize that. However, a lot of the voices of discontent and cynicism are living very comfortable lives in America relative to others. Even having access to a flushing toilet and consistent electrical service are luxuries. The US social safety net is only embarrassing by the standards of 30 or so of the most wealthy nations. Medicaid, Medicare, and social security, even in a diminished state, are progr…

> Even having access to a flushing toilet and consistent electrical service are luxuries

Globally sure. But we don't measure ourselves by global standards. We measure ourselves by what we have around us, and the norms we were brought up with. No one in North America thinks indoor plumbing with flushing toilets is a luxury it's a basic necessity, and they're right to think so by the standards of their society.

The US social safety net is embarrassing by the standards of what lives people in the US expect to have.

Saying that their expectations are silly because people in rural Africa don't have indoor plumbing is kind of asinine. They are reasonably setting their expectations based on their neighbours experience not the most baseline human experience.

Re: Newly retired couples may lose $16,900/year in Social Security in 2033

#66

Post by Schiendelman »

phil21 wrote: post #38
Schiendelman wrote: post #4

Earlier quoted context omitted.

Honestly, the reporting has looked the same around this since the 1980s. I've read books from them referencing how Social Security was going to be bankrupt by the 90s, or the 2000s. The fact is that older people vote way more than younger people, so it stays funded; we will at worst pay for some of it out of income taxes.

The date was always in the 2030-2040 range since I started reading about it in the 90's. At my first job I planned my retirement around the trust fund running out by the time I retired, and benefits being cut passively via cost of living not matching inflation. This is largely due to congress actually taking action in the early 80's, which pushed this date back to the current 2030ish estimate. As the date draws neare…

The first projected failure date I know of was 1979, which was reported on in the early 1970s.

There were amendments in 1977 that should have helped, but the 1980-81 recessions made it bad again; by 1982 the Trustees said it would be insolvent in 1983.

In 1983 the Greenspan Commission and the resulting amendments believed they pushed solvency through the 2050s.

In 2005 that was down to 2041, in 2010 it was 2037, and since then it's sat around 2033-2035.

In Jane Jacobs' book "Cities and the Wealth of Nations" in 1984, she saw the pattern, and brought up that you'd have to keep amending it forever.

Re: Newly retired couples may lose $16,900/year in Social Security in 2033

#67

Post by Schiendelman »

seanmcdirmid wrote: post #6
Schiendelman wrote: post #4

Earlier quoted context omitted.

Honestly, the reporting has looked the same around this since the 1980s. I've read books from them referencing how Social Security was going to be bankrupt by the 90s, or the 2000s. The fact is that older people vote way more than younger people, so it stays funded; we will at worst pay for some of it out of income taxes.

The math has been constant, if you were reading reports saying it would hit the breaking point in the 90s or 2000s, you are either misremembering, confusing it with something else, or willfully distorting facts. Anyways, if you make claims like that you should take advantage of internet linking features and just provide your evidence directly vs a “I remember reading” anecdote. There was a point where social security…

Maybe you are misremembering. The Greenspan Commission was the last time we significantly amended social security to avoid these problems, and it was in the 80s: https://en.wikipedia.org/wiki/Greenspan_Commission

Re: Newly retired couples may lose $16,900/year in Social Security in 2033

#68

Post by Schiendelman »

bronco21016 wrote: post #19
Schiendelman wrote: post #4

Earlier quoted context omitted.

Honestly, the reporting has looked the same around this since the 1980s. I've read books from them referencing how Social Security was going to be bankrupt by the 90s, or the 2000s. The fact is that older people vote way more than younger people, so it stays funded; we will at worst pay for some of it out of income taxes.

As others have pointed out, the date has long been mid/early 2030s. You may be remembering that it’s been a hotly debated issue since the 80s. I distinctly remember it being a massive election issue in 2000 between Gore and Bush (the first election I’m old enough to remember in detail). It was the whole “lockbox” vs government funding of private accounts debate.

In the early 80s, the date was not in the 2030s - not until after the Greenspan Commission and that set of reforms.

Re: Newly retired couples may lose $16,900/year in Social Security in 2033

#69

Post by rpdillon »

Grombobulous wrote: post #17
rpdillon wrote: post #14

Earlier quoted context omitted.

This is fantasy. There's nowhere for the money to come from. They're going to raise the age, reduce benefits.

Tax rates could be raised, especially on the wealthy, who enjoy historically low tax rates.

Yes, I believe Senator Slotkin was recommending that we remove the cap on Social Security so that folks making more than $180,000 continue to pay Social Security tax on the income above that amount.

Re: Newly retired couples may lose $16,900/year in Social Security in 2033

#70

Post by seanmcdirmid »

Schiendelman wrote: post #67
seanmcdirmid wrote: post #6

Earlier quoted context omitted.

The math has been constant, if you were reading reports saying it would hit the breaking point in the 90s or 2000s, you are either misremembering, confusing it with something else, or willfully distorting facts. Anyways, if you make claims like that you should take advantage of internet linking features and just provide your evidence directly vs a “I remember reading” anecdote. There was a point where social security…

Maybe you are misremembering. The Greenspan Commission was the last time we significantly amended social security to avoid these problems, and it was in the 80s: https://en.wikipedia.org/wiki/Greenspan_Commission

Greenspan commission wasn’t a prediction. They used a previous pay as you go model that was simply broke at that time (and had been for awhile$, leading to the current pay for the future model. They then made predictions that the new system would be solvent way past 2033.
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