If age < 48 what % of paid in Social Security purchasing power do you expect back?

Discussion in 'Business & Economics' started by Billy T, Oct 1, 2012.

?

What % of purchasing power paid in to SS do you expect to get back?

  1. 0 As I think SS will not exist when my age = 67.

    4 vote(s)
    80.0%
  2. ~15% or less

    0 vote(s)
    0.0%
  3. ~30% or less but > 15%

    0 vote(s)
    0.0%
  4. ~45% or less but > 30%

    0 vote(s)
    0.0%
  5. ~60% or less but > 45%

    1 vote(s)
    20.0%
  6. ~75% or less but > 60%

    0 vote(s)
    0.0%
  7. ~90% or less but >75%

    0 vote(s)
    0.0%
  8. ~105% or more but > 90%

    0 vote(s)
    0.0%
  1. Billy T Use Sugar Cane Alcohol car Fuel Valued Senior Member

    Messages:
    23,198
    I am curious what do those 47 or less years old now expect to get back from Social Security in terms of a percent of their paid in purchasing power, 20 or more year from now, when you reach the current "full retirement age" (67)? Please post your approximate age, if you don´t mind in your comments. At least tell which of the four different "decade groups" below you are in. Poll will NOT show how you voted, but you may tell in your post in this thread, if you wish. Poll should be "open" forever so late comers can vote too.

    If 48 or older feel free to post comments, but please don´t vote.

    If age now is between, then:
    38 < 48 you are at least 20 years from retirement
    28 < 38 you are at least 30 years from retirement, but for this group and younger two below, full retirement age surely will be again increased to at least age 70.
    18 < 28 you are at least 40 years from retirement
    08 < 18 you are at least 50 years from retirement

    As I have been collecting "full benefit" SS for quite a few years since I was 65, I have gotten about 125% return of my purchasing power now. HOWEVER, when I was paying in, the fraction of my pay taken by the SS tax and annual maximum were both much less, so I think you won´t do as well more than 20 or more years from now.
     
    Last edited by a moderator: Oct 1, 2012
  2. Google AdSense Guest Advertisement



    to hide all adverts.
  3. seagypsy Banned Banned

    Messages:
    1,153
    What equation do you use to figure it out?
     
  4. Google AdSense Guest Advertisement



    to hide all adverts.
  5. quadraphonics Bloodthirsty Barbarian Valued Senior Member

    Messages:
    9,391
    How long do you expect to live?

    I've already gotten every cent I've paid into payroll taxes back in spades. It came in the form of a society where the elderly are taken care of, rather than being a direct burden on myself and other workers. Who wants to have their parents live with them, or pay their medical bills? Not me. The fact that I myself also get an entitlement to be taken care of when I am elderly is simply gravy. Social Security is not an investment fund, but a transfer welfare system. So it's stupid to analyze it as if it were the former - in particular, by ignoring the direct benefits that taxpayers accrue every single day of their lives and instead focussing myopically on direct cash "returns" to individual taxpayers later in life. By the time you reach retirement, you're already wealthier for having enjoyed the benefits of those programs for your entire working life; quibbling about whether you get enough cash payments yourself is just greedy and small-minded.
     
  6. Google AdSense Guest Advertisement



    to hide all adverts.
  7. Michael 歌舞伎 Valued Senior Member

    Messages:
    20,285
    The elderly are being taken care of?

    Yeah, the North Koreans also 'take care' of their elderly - of course life there sucks because of it and all the other 'social welfare' programs they have.

    No, the elderly are watching as the State attempts it's best to steal their savings.
    Not to mention, that gravy you are enjoying, is made from the ground bones of the next generation of Americans who will have (do have) a much LESS prosperous life. Many live with their parents and can not find meaningful work, do not have a chance at all of starting a family without State 'help' (and will be well into their 40s when they do) are in debt from everything from student loans to mortgages they can't repay and you're telling them - that's OK, at least their grandparents get taken care of without (like them) of having to move in with their family members.



    Maybe you want to look out your palace window once in awhile?
     
  8. iceaura Valued Senior Member

    Messages:
    30,994
    The only money I would be looking to get "back" would be the overcharge I've been paying to cover my own SS as the demographic bulge works through - the deal Reagan worked out, to avoid expanding the SS income range or otherwise burdening rich people unduly.

    That was borrowed by the central government to cover shortfalls created by giving tax breaks to rich people, and was to be paid back by income taxes (then, a progressive setup burdening the rich) as the bonds came due. This effectively gave the wealthy a low interest loan, to be paid back later.

    It's later. So getting that money back - the money taxed from the boomers that was supposed to cover the boomers - is just a matter of taxing rich people at the expected rates as assumed by the Reagan SS deal.

    Otherwise, none of it comes "back" - it's handed over to old folks, and they don't owe it to me.
     
  9. Billy T Use Sugar Cane Alcohol car Fuel Valued Senior Member

    Messages:
    23,198
    "The graph below compares annual old-age benefits to lifetime payroll taxes for 23-year-olds who will work until the age of 67 while earning constant incomes."

    Please Register or Log in to view the hidden image!

    Quote and graph from: http://www.justfacts.com/socialsecurity.asp Graph is not terribly wrong if you life time average earnings is value shown on the graph.

    For example, if you earned slightly less than $80,000 annually for 67-23 = 44 working years, you would get back at 6% or all your contributions in about 12 years at age 79, should you live that long. Of course the dollars you collect may, probably will, have much less purchasing power than those you paid in. I.e. graph is in nominal dollars, not CPI corrected dollar as no one knows what future CPI corrections will be. Also assumed is that Congress does not cut the benefits or raise the "full benefit retirement" age from current 67 years before you begin to collect.

    Remember, please only comment if 58 or older - don´t vote.

    I retired early as I could afford to as I wanted to move to Brazil (to live with Brazilian lady I met in Mexico) but one minor factor was that the SS tax the next year was to jump from 3% to 6% (and I think the max annual collections went up greatly too, but don´t remember the data of that change.) Anyway a little analysis convenienced me I could not live long enough to get my purchasing power back on next year´s contributions if I paid in at 6% rate. You are paying more than twice that rate now, but current inflation rate is at least 4 times lower than when I decided to retire so your dollars are losing purchasing power more slowly, at least now!
     
  10. quadraphonics Bloodthirsty Barbarian Valued Senior Member

    Messages:
    9,391
    Everyone American who has paid a dime in payroll taxes has already gotten their money back - and more - in the form of a society that provides a safety net for its elderly. Even if I never get one red cent in retirement benefits myself, it will have been a good bargain. Having to house and feed my parents would be a much bigger drag on my finances and lifestyle than my payroll taxes have ever been. Multiply that by the benefit of my friends and co-workers being similarly unencumbered, and it's a sweetheart deal. The fact that I stand to get retirement payments when I'm old is simply icing on the cake.

    Of course, ex-pats who abandon the USA might not give a rat's ass about the state of American society and the burden of caring for the elderly on the current workforce, if they are of a selfish, small-minded outlook. In that case, such a craven sort might well go in for the fallacy of viewing a transfer welfare system as if it were his personal retirement investment fund.
     
  11. Billy T Use Sugar Cane Alcohol car Fuel Valued Senior Member

    Messages:
    23,198
    So you are claiming that it would have cost you more ("much bigger drag on my finances") if instead of SS making monthly payments making it possible for your parents to live in their own house and not "unencumber" you than if they lived in yours with you. If not that you are claiming that that what you have paid into the SS system has been a such wonderful financial investment (in purchasing power) that it is paying the extra cost of two separate houses, separate meals, etc. Either way its the old, but false, "two can live as cheaply as one" (or more accurately: 4 under one roof is more expensive than 2 + 2 under separate roofs) you are making.

    That is very hard to believe that maintaining two separate houses is cheaper than just maintain just one. Or that their buying food independently of you is some how cheaper than you buying food for your family plus more for them, despite two trash cans getting the food that was not needed / that one one wanted to eat when they live separately.

    I´m not saying that the modern (until recently)* idea of each generation living separately is without non-financial benefits - only that those personnel benefits are NOT more economical, as you claim.

    * Two or even three generations living under one roof is now an economic necessity for many, who never thought their college graduate "child" would be living with them, putting their feet under the table at meal time, borrowing their old car, etc. several years after graduation as his/her "Big Mac" job´s salary will not support a separate house and as far a marriage is concerned - that will just have-to wait.
     
  12. quadraphonics Bloodthirsty Barbarian Valued Senior Member

    Messages:
    9,391
    Not quite - you have to account for the mobility aspect in the "finances" section, and you seem to be ignoring the "lifestyle" category altogether.

    Not once you account for the fact that my parents live in a very cheap state far away, and I live in a very expensive area where the jobs are and frequently move around to take advantage of job opportunities. If I moved out there, the income my wife and I generate would drop dramatically. If they moved here, we'd be reduced to sharing a tiny living space with a huge commute to work. Either way, we'd all be worse off than we are now.

    Or, of course, once you factor in the lifestyle cost: I'd gladly pay a premium to not have to live with my parents, and they'd gladly pay a premium to have their own places. It might well cost somewhat less to share one house, but we'd all hate that lifestyle. And anyway it wouldn't work out even in purely financial terms because of the huge impact of mobility on my earnings and the very different balance of cost-of-living vs. availability of work that is appropriate for myself vs. my parents.

    The main financial consideration is not that it saves money on rent or mortgages directly, but that it enables younger people to move away from their parents and so pursue a wider range of job opportunities. That way, they end up making a lot more money over the course of their careers, and the economy itself is more competitive in the aggregate because employers have a wider, deeper pool of talent to draw on. Without Social Security, most workers - and especially, those in the lower-middle-class and below - will be stuck supporting their elderly parents and so unable to move off and pursue potentially-lucrative work elsewhere. Mobility is one of the major assets that younger workers have for investing in their long-term earnings growth, and Social Security enables that, particularly for the less-wealthy classes. This is doubly true these days in the era of globalization, where the whole "work for the factory for 40 years" career path is largely dead and gone. Take away that mobility, and you are taking a huge bite out of the lifetime earnings of the workers who will be stuck at home caring for their parents.

    Well, again, that is a strawman that you have invented, so I don't particularly care how hard or not you find it to believe.

    What I said is that it's a financial winner overall - due to mobility and cost of living issues, not the premise that two houses are cheaper than one - and in lifestyle terms. You can feel free to address that, if you expect me to care about how believable you find it.
     
  13. iceaura Valued Senior Member

    Messages:
    30,994
    It's complete bullshit, and you are far too intelligent not to know it.

    Aside from possibly - by stretching a bit - the Trust Fund, which is a matter of taxing rich people as planned, SS is not an investment, and does not "return" a nickel to anyone. It's an awkwardly set up, somewhat inefficient welfare arrangement for old people, and always has been. To ask people what "return" they expect is to deal in deception and sleight of hand. You might as well ask what return they expect on their contribution to Food Stamps.
     
  14. quadraphonics Bloodthirsty Barbarian Valued Senior Member

    Messages:
    9,391
    The hallmark of the bullshit artist is unconcern with the truth or falsity of statements, as such. The only factor that matters is whether it seems like it will serve the agenda and impress the audience. The goal of bullshit artistry is to carve out a social position from which one can issue pronouncements with total disregard for their truth values, and have these be accepted on authority. Neither the pursuit of careful, detailed analysis before the fact, nor the admission of error after the fact, have much place in such an agenda - they both imply an admission that the putative authority is a mere fallible mortal answerable to the same epistemic demands as everyone else.

    And to do so continuously, over the course of years, in the face of repeated, clear corrections, is a strong demonstration of both indifference to truth and refusal of accountability to the audience.
     
  15. Billy T Use Sugar Cane Alcohol car Fuel Valued Senior Member

    Messages:
    23,198
    Slightly modified end of post here: http://www.sciforums.com/showthread...Ponzi-Scheme&p=2993171&viewfull=1#post2993171

    SUMMARY: The difference between SS & food stamps, is in how the government´s own literature describes them. Food stamps are honestly described as welfare that a self respecting society must give, especially for the hungry children (like school lunch programs do too) BUT, as shown above, SS is dishonestly described as:
    "YOUR Social Security" and NEVER as program helping the currently old and needed live better. What you will collect from YOUR SS, like any other investment, is based on your pay in record.
     
  16. quadraphonics Bloodthirsty Barbarian Valued Senior Member

    Messages:
    9,391
    Your Social Security benefits are "yours." "You" do get an entitlement to receive benefits out of paying into the system. That doesn't render it an investment account, and none of the Social Security literature I've seen has described it as an investment vehicle. You have not posted any actual quotes of Social Security literature, so there is no substance behind your assertions about how it describes anything.

    Moreover, none of the people you are addressing here are under this putative misconception, so you are addressing another strawman and using more weasel words to do it. We are not accountable to this supposed mass misconception that you assert without any substantiation.

    Similarly, there are plenty of other programs where "what you receive" is "based on your pay-in record," but which are not investment vehicles. The size of my tax refund depends on "what I pay in, but that doesn't magically transform my tax withholdings into an "investment."

    From Wikipedia:

    In finance, investment is the commitment of funds through collateralized lending, or making a deposit into a secured institution.​

    That is the relevant definition of "investment." Things that do not meet that basic definition are not "investments," totally regardless of whatever other superficial qualities they might share with actual investments.

    The fact that you keep siezing onto ancillary properties of the terms used in your analogies - while studiously avoiding the salient definitions - is pretty damning evidence that you are arguing in bad faith. Looks like you just like the scare rhetoric of "SS is a bad investment!" and are just trying to avoid admitting that it's bullshit.
     

Share This Page