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PrintA recent survey showed young people wondered if Social Security would be around for their retirement. Today 4.3 million children receive survivor's benefits from a deceased parent's Social Security account. When today's young people get their Social Security number, if they die, their spouse, children and maybe their parents will receive survivors payments.
In 1939, dependent and survivor benefits were added to Social Security premiums to cover costs. Social Security is managed by a congressional committee which studies needs and makes suggestions to Congress and the president, who sets the premium for the next year. Social Security premiums have been changed each year since 1974. If no changes are made, Social Security can make full payments for the next 21 years, then payments will be 75 percent. I look for changes before 21 years.
You are or know someone who is now or has been aided by dependents' or survivors' benefits.
Harry R. Weitkemper is a Columbia resident.
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Another way of looking at the youth angle is that a retiree today will receive far more in SS benefits than he or she paid into the system over a lifetime. Someone who's a youth today can look forward to receiving far less in retirement than he or she paid in: 65 cents for every $1 paid, by some estimates.
And that's assuming that SS will still be around. The U.S. Supreme Court has ruled multiple times that Congress can reduce or eliminate benefits no matter how much or how long you've paid in. Contrary to popular belief, SS is NOT guaranteed.
I could probably take those mandatory payments for Social Security and do my kids a lot more good by buying cheap term life insurance, and save some money to boot. Now to dig up a paycheck stub and do the math...
Jimmy brings up some important points that everyone needs to understand: Social Security is not savings; it's a direct intergenerational transfer payment. It always has been, always will be. Everyone needs to understand that, instead of imagining it works like a savings account.
The implementation of Social Security changed the poverty rates of the elderly from over 60%, to under 20%. It is extremely successful in reducing poverty among the elderly. But, to accomplish that, it actually has to transfer wealth from the younger working population, to the older retired population.
The question isn't, "What can I do for my kids?" It's "How do we care for our elderly?" That's what Social Security and Medicare are doing now, via direct transfer payments.
"it actually has to transfer wealth from the younger working population, to the older retired population."
Why not mention that everyone who works legitimately in the U.S. pays into the fund, from the time they start, until they stop working?
Oh, yeah. Your premise, "it's a direct intergenerational transfer payment" becomes really hard to sell when the omitted facts are included. Give us a break!
frank christian wrote:
"Why not mention that everyone who works legitimately in the U.S. pays into the fund, from the time they start, until they stop working?"
Yes, that's true. But unlike a defined benefit pension plan or 401(k), you never "vest" in Social Security. Your payments are taxes, which means they do not necessarily go toward anything that benefits you. You have no legal right to Social Security no matter how much you pay in. That's why SS is not a retirement plan. It's more like welfare, and it can be changed or eliminated just like welfare can.
DK
Yes, that's true, but how does it, then become a "a direct intergenerational transfer payment"?
"it can be changed or eliminated just like welfare can." "can", but will Not, as long as a Democrat controlled Congress has access to the money!
I would think the "intergenerational" thing would be obvious - younger generations of workers pay taxes to support retired older generation folks.
One of the fastest ways for a politician to doom his election chances is to suggest eliminating Social Security. It's a very popular program, and we need to plan for the future with that in mind. I'm all for letting people opt out of it and invest on their own, but I doubt a lot of people would be willing to do that in these boom-and-bust times.
DK
Mark F. - "I would think the "intergenerational" thing would be obvious - younger generations of workers pay taxes to support retired older generation folks."
"Why not mention that everyone who works legitimately in the U.S. pays into the fund, from the time they start, until they stop working?"
You know, of course, that even elderly SS recipients,whom continue to work have fica payments deducted from their checks! This is my last dance on the "intergenerational thing".