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It’s my body, not the governments
Replies
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Aaron_K123 wrote: »Bry_Fitness70 wrote: »tbright1965 wrote: »MeanderingMammal wrote: »tbright1965 wrote: »
No, my point is contrary to the post quoted, I found the 401(k) to be superior to Social Security and that there was not incentive for the military to lower costs. Even when contracted out, unless the branch spending the money has an incentive to spend less, they will spend every dollar allocated, even if the goods or services are not needed.MeanderingMammal wrote: »tbright1965 wrote: »When I was in the military, people are rated based on the size of their kingdom. If an organization had money left over at the end of the fiscal year, they didn't return it for others to use. They spent it so they would get as much if not more the next fiscal year.
I'm not entirely clear on your point here. Are you suggesting that the delivery of military effect is something that should be provided by the private sector?
So the issue isn't with the delivery of military effect being a government function?
I'd agree that the behaviours that incremental budgeting encourages are unhelpful, but that's an issue with the budgeting technique rather than public services.
Zero based budgeting encourages its own bad behaviours, although in truth I think it's a more comprehensive approach to it.
The issue is blind belief that either government or private sector is the best.
Why not give people the choice? I.E. if one believes Social Security is better than a 401(k) let them VOLUNTARILY put their money in Social Security and live with the outcome. If others believe a 401(k) is the better option, instead of making them be part of Social Security (all or just the income security portion of FICA taxes) let them choose. Maybe they choose 0-100% of the 6.2% portion of their FICA taxes to go into SS and a similar choice for the employer's matching 6.2% "contribution."
But just passing a law saying you must be part of this great plan we've developed may not be the best for all involved.
I know I could be retired in my mid-50s had I had control of the 12.4% taken each year and immediately spent instead of modestly invested in index funds.
That's a high-tech job that could be filled by another instead of me, if I had control over those funds.
Instead, I'm forced into SS where not only must I contribute, but I'll only see 30% of my indexed monthly income s a benefit vs the worker who paid closer to the minimum who will get 90% of his indexed monthly income at full retirement age.
It's a bad deal all the way around for me.
The basic point I am making is that, in a complex, modern society of 330 million people, it doesn’t always get to be about you. (Or me, or any single individual for that matter). The design of something like SSI and the issues involved are a lot more complex than just saying “I want my 12.4%, because I want it”. (And what makes you think for even an instant that the company you work for would be willing to turn over that 6.2% if they weren’t “forced” to by the government? They would be crying “freedom” more quickly, more loudly, and more effectively than you).
And, as recent years have shown, there is no guarantee that you could invest your money that successfully, or that other factors over which you have no control wouldn’t intervene. Then the rest of society would have to pitch in and support you. A society has to take the long view of what is the best fit for everyone. I understand your point, but I think you are making the common mistake of seeing things only from the point of view of your narrow self-interest (not meant as criticism). The track record of the “voluntary” system you favor overall is not encouraging. We are going to be facing a crisis in the future because the vast majority of people in 401K plans have done a pretty poor job of investing—partly because they haven’t been able to invest much, partly because they aren’t very good at investing, and partly because their earnings are sharply reduced by fees that are charged (401K plans are in large part government-sponsored welfare programs for banks).
Obviously, you think you are the outlier. And you very well could be. And so from your perspective, it seems unfair that you are “forced” into a system that you think puts you at a disadvantage. And that could very well be true. My feeling is that society cannot risk having millions of elderly, impoverished citizens, just so that a special few (like you and me) can do better. IMO, that might suck, but that’s the price you pay for living in a modern nation with all the benefits that America has to offer. Overall, it’s not such a bad deal.
I didn’t read all of it, but this site seemed to be a honest attempt to lay out the pros and cons:
https://socialsecurity.procon.org/
The problem with SSI is 1) if I could have taken that 12.4% and invested it myself in the same portfolio as my 401k I would have a very good return and benefits far exceeding what I will draw from SSI some day. 2) I can start withdrawing from my 401k at 59.5 years old, while I have to wait until I'm 67 to get my full SSI benefit. So by being locked into a non-customizable SSI program, I get less money and I get it later.
I get that many people do not want to invest their own SSI - for those, they can opt for the old system and have a static benefit available. For the rest of us - it is our benefit that we are paying into, so let us have some control over it.
Again....SS doesn't exist for you or me or people who have enough money and work in a professional career to invest in a matched 401k. It isn't there so that I can retire and get a boat instead of not being able to get a boat. Yeah our ROI putting into SS isn't as good as putting into a 401k. That is because all we put into a 401k goes to us...not all we put into SS goes to us, some of it goes to other people who need it....like truly need it.
If you and I pay into SS then SS has enough funds to take care of the sewer maintenance worker who worked every day of their life until 60 when their knees were failing and they could work no more but still lived to the age of 85. To make sure they had at least enough for a plate of rice and beans and a roof over there head.
If you and I instead took that money and put it into a 401k that 401k isn't going to be giving anything to that sewer maintenance worker at all...we are just going to be able to afford that boat. So what system is in place to make sure that person, who worked dutifully and provided a service that we all benefit from, doesn't die destitute in a ditch somewhere?
The only answer people seem to have for that is "Charity". But honestly if there was a Charity that was large enough and distributed enough to do what the government does with social security then how exactly would it not have the same logistical and financial issues and need for everyone to contribute?
The sewer maintenance worker and everyone else benefits when the SSI dollars collected are permitted to be invested responsibly. A minimum benefit level can still be established for those that fall short, but having money that gathers dust and doesn’t grow is extremely irresponsible and wasteful and benefits no one.
If the SSI funds were allowed to be invested individually and the sewer worker’s lifetime contributions and growth did not reach a minimum benefit threshold (I think the max right now is around$2,600), I’m all for the government bridging that gap so the guy still gets his $2,600 per month. Meanwhile, if I had been able to invest my own SSI contributions in the same funds as my 401k all of these years, I would be able to at least double my benefit when I retire. This is not to “buy a boat”, this is to achieve an income and lifestyle that is ballpark what I live on today, which I don’t think is unreasonable after working hard my entire adult life.
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I don't mind. The government is there to control people to a point because lets face it, people don't make the smart decisions. They think "I won't get addicted, I"LL be stronger than that" and guess what? They aren't, they get addicted, they cause issues for society as whole. What junkie starts out thinking "YES, can't wait to be a drain on society and start fights and pimp myself out for my next fix!"? It's generally, "just this once to relax/calm down/hit that deadline/etc."
And if people really want 'my body my rules' then stop breathing the clean air that's regulated by the gov't, driving your car on roads maintained by the gov't, drinking clean water that is regulated by the gov't, and sending your kids to gov't regulated schools. In a modern society, you have to have rules for the good of the society as whole.4 -
Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »tbright1965 wrote: »MeanderingMammal wrote: »tbright1965 wrote: »
No, my point is contrary to the post quoted, I found the 401(k) to be superior to Social Security and that there was not incentive for the military to lower costs. Even when contracted out, unless the branch spending the money has an incentive to spend less, they will spend every dollar allocated, even if the goods or services are not needed.MeanderingMammal wrote: »tbright1965 wrote: »When I was in the military, people are rated based on the size of their kingdom. If an organization had money left over at the end of the fiscal year, they didn't return it for others to use. They spent it so they would get as much if not more the next fiscal year.
I'm not entirely clear on your point here. Are you suggesting that the delivery of military effect is something that should be provided by the private sector?
So the issue isn't with the delivery of military effect being a government function?
I'd agree that the behaviours that incremental budgeting encourages are unhelpful, but that's an issue with the budgeting technique rather than public services.
Zero based budgeting encourages its own bad behaviours, although in truth I think it's a more comprehensive approach to it.
The issue is blind belief that either government or private sector is the best.
Why not give people the choice? I.E. if one believes Social Security is better than a 401(k) let them VOLUNTARILY put their money in Social Security and live with the outcome. If others believe a 401(k) is the better option, instead of making them be part of Social Security (all or just the income security portion of FICA taxes) let them choose. Maybe they choose 0-100% of the 6.2% portion of their FICA taxes to go into SS and a similar choice for the employer's matching 6.2% "contribution."
But just passing a law saying you must be part of this great plan we've developed may not be the best for all involved.
I know I could be retired in my mid-50s had I had control of the 12.4% taken each year and immediately spent instead of modestly invested in index funds.
That's a high-tech job that could be filled by another instead of me, if I had control over those funds.
Instead, I'm forced into SS where not only must I contribute, but I'll only see 30% of my indexed monthly income s a benefit vs the worker who paid closer to the minimum who will get 90% of his indexed monthly income at full retirement age.
It's a bad deal all the way around for me.
The basic point I am making is that, in a complex, modern society of 330 million people, it doesn’t always get to be about you. (Or me, or any single individual for that matter). The design of something like SSI and the issues involved are a lot more complex than just saying “I want my 12.4%, because I want it”. (And what makes you think for even an instant that the company you work for would be willing to turn over that 6.2% if they weren’t “forced” to by the government? They would be crying “freedom” more quickly, more loudly, and more effectively than you).
And, as recent years have shown, there is no guarantee that you could invest your money that successfully, or that other factors over which you have no control wouldn’t intervene. Then the rest of society would have to pitch in and support you. A society has to take the long view of what is the best fit for everyone. I understand your point, but I think you are making the common mistake of seeing things only from the point of view of your narrow self-interest (not meant as criticism). The track record of the “voluntary” system you favor overall is not encouraging. We are going to be facing a crisis in the future because the vast majority of people in 401K plans have done a pretty poor job of investing—partly because they haven’t been able to invest much, partly because they aren’t very good at investing, and partly because their earnings are sharply reduced by fees that are charged (401K plans are in large part government-sponsored welfare programs for banks).
Obviously, you think you are the outlier. And you very well could be. And so from your perspective, it seems unfair that you are “forced” into a system that you think puts you at a disadvantage. And that could very well be true. My feeling is that society cannot risk having millions of elderly, impoverished citizens, just so that a special few (like you and me) can do better. IMO, that might suck, but that’s the price you pay for living in a modern nation with all the benefits that America has to offer. Overall, it’s not such a bad deal.
I didn’t read all of it, but this site seemed to be a honest attempt to lay out the pros and cons:
https://socialsecurity.procon.org/
The problem with SSI is 1) if I could have taken that 12.4% and invested it myself in the same portfolio as my 401k I would have a very good return and benefits far exceeding what I will draw from SSI some day. 2) I can start withdrawing from my 401k at 59.5 years old, while I have to wait until I'm 67 to get my full SSI benefit. So by being locked into a non-customizable SSI program, I get less money and I get it later.
I get that many people do not want to invest their own SSI - for those, they can opt for the old system and have a static benefit available. For the rest of us - it is our benefit that we are paying into, so let us have some control over it.
Again....SS doesn't exist for you or me or people who have enough money and work in a professional career to invest in a matched 401k. It isn't there so that I can retire and get a boat instead of not being able to get a boat. Yeah our ROI putting into SS isn't as good as putting into a 401k. That is because all we put into a 401k goes to us...not all we put into SS goes to us, some of it goes to other people who need it....like truly need it.
If you and I pay into SS then SS has enough funds to take care of the sewer maintenance worker who worked every day of their life until 60 when their knees were failing and they could work no more but still lived to the age of 85. To make sure they had at least enough for a plate of rice and beans and a roof over there head.
If you and I instead took that money and put it into a 401k that 401k isn't going to be giving anything to that sewer maintenance worker at all...we are just going to be able to afford that boat. So what system is in place to make sure that person, who worked dutifully and provided a service that we all benefit from, doesn't die destitute in a ditch somewhere?
The only answer people seem to have for that is "Charity". But honestly if there was a Charity that was large enough and distributed enough to do what the government does with social security then how exactly would it not have the same logistical and financial issues and need for everyone to contribute?
The sewer maintenance worker and everyone else benefits when the SSI dollars collected are permitted to be invested responsibly. A minimum benefit level can still be established for those that fall short, but having money that gathers dust and doesn’t grow is extremely irresponsible and wasteful and benefits no one.
If the SSI funds were allowed to be invested individually and the sewer worker’s lifetime contributions and growth did not reach a minimum benefit threshold (I think the max right now is around$2,600), I’m all for the government bridging that gap so the guy still gets his $2,600 per month. Meanwhile, if I had been able to invest my own SSI contributions in the same funds as my 401k all of these years, I would be able to at least double my benefit when I retire. This is not to “buy a boat”, this is to achieve an income and lifestyle that is ballpark what I live on today, which I don’t think is unreasonable after working hard my entire adult life.
So your assumption is that the government does not invest or utilize SS funds or that they invest them in a sub-optimal way? Can you back that up with something showing where SS funds are going or are you just assuming that?
In order to bring that gap up to $2600 a month the government would require funds, they would get those funds from a tax...they might call that tax something, like social security. You basically just described what social security tax is.I’m all for the government bridging that gap so the guy still gets his $2,600 per month.
That is assuming that the goverment wasn't using SSI contributions to "bridge the gap" for those who are in poverty....which is the point of SSI. I think that the return on investment for SS is worse than for a 401k in your experience because your SS dollars are in part going to bridge gaps of poverty while your 401k dollars aren't...that doesn't mean that SS dollars aren't invested. If you were allowed to put all your SS dollars into a 401k instead then where is the money to bridge those gaps?Meanwhile, if I had been able to invest my own SSI contributions in the same funds as my 401k all of these years, I would be able to at least double my benefit when I retire.4 -
tbright1965 wrote: »janejellyroll wrote: »tbright1965 wrote: »
Don't even need the hypothetical, I do so now. I've worked mission projects in the US and abroad, helping others. I make cash and other donations to organizations that help others. I've even been known to buy a meal or a coat for the guy on the street who is down and out.janejellyroll wrote: »tbright1965 wrote: »
I was asked what I'd do, and I answered it.
It's not my place to put a value on the life of another. I don't want that responsibility. If you feel responsible, then pony up. But don't feel obligated to support me. I'd rather people NOT try to keep me around if I cannot support myself.
If others feel otherwise, make plans. Just don't sign me up for your values and expect me to provide my time, talent and treasure to support your vision of the greater good just because those are your values.
I appreciate you answering the question and if my response conveyed otherwise, I'm sorry for that. I was asking you further questions to continue the conversation not to indicate that your answers to date didn't satisfy me.
We all place values on the lives of others through our daily decision making process.
If there was no governmental safety net, are there circumstances in which you would give your personal time, talent, and treasure to support those who are unable to work? Or do you consider those who do concerns (at least some) of the lives of the unable to work as having values other than yours? That's what I am picking up from your use of the term "your values."
Now, I don't like handing out cash on the street because that may go for some habit that is not helping that person. But I will buy a meal, fill a gas tank, etc. If I've been played, at least I was played willingly. Usually, if someone really needs a tank of gas to get to Chicago, they'll let me fill their tank. If they are just hustling some cash to support a habit, their need for gas turns into just give me some cash...
So I've donated my time, talent and treasure to help others. Those are my values.
However, it's not my place to impose my values on others. If you don't wish to donate as I do, or even at all, that's your right.janejellyroll wrote: »
That you wish to die in certain circumstances doesn't mean that others wouldn't value their lives in that same situation. There are people who would want to die if they were disabled in a certain way, but not all of them insist that those who are disabled in that way should be executed. When it comes to the individual choice of life or death, we don't have to insist others must make the same choice we would.
Who said anything about executing someone?
I'm glad you said we don't have to insist others make the same choice, because that's what welfare through taxation does. You are forced to "make" the "choice" where it comes to helping others. Those values, voted into law are now "your" values by legislative fiat.
My view is exactly as you describe, not wishing to impose my values on another. If someone else wants to freely give more or less, even to zero, that is totally their right. If they want to live, let them live. If they want to die, let them die. If they want to help others, let them. If they want to be part of a big government apparatus, let them. Let those who don't wish to belong stay out of it.
Freedom, it really is that simple.
If one assumes that others should live or die based on their individual preferences if found in another individual's situation, then execution would almost certainly be involved (I understand that isn't your position, but there is where execution comes into it).
A society safety net doesn't insist that anyone die in a situation where I would choose death. People can always choose death or suicide if that is their preference. A society safety net ensures that an individual that prefers to continue living can continue living, even if they are unable to work. Just saying "let them live" isn't sufficient to ensure continued life, there has to be some sort of action to accompany it. I understand you feel that action should always be that of a private individual.
No one is saying don't craft a social safety net. I'm simply saying do it without forcing others to "contribute."
The theft of freedom isn't the net, it's the notion that everyone who is able must contribute.
Have your net. Just do it with volunteered time, talent and treasure. Don't use resources taxed from others.
That way, the freedom of everyone is preserved.
Has this ever been accomplished anywhere? It doesn't seem like a very practical proposal.8 -
Aaron_K123 wrote: »Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »tbright1965 wrote: »MeanderingMammal wrote: »tbright1965 wrote: »
No, my point is contrary to the post quoted, I found the 401(k) to be superior to Social Security and that there was not incentive for the military to lower costs. Even when contracted out, unless the branch spending the money has an incentive to spend less, they will spend every dollar allocated, even if the goods or services are not needed.MeanderingMammal wrote: »tbright1965 wrote: »When I was in the military, people are rated based on the size of their kingdom. If an organization had money left over at the end of the fiscal year, they didn't return it for others to use. They spent it so they would get as much if not more the next fiscal year.
I'm not entirely clear on your point here. Are you suggesting that the delivery of military effect is something that should be provided by the private sector?
So the issue isn't with the delivery of military effect being a government function?
I'd agree that the behaviours that incremental budgeting encourages are unhelpful, but that's an issue with the budgeting technique rather than public services.
Zero based budgeting encourages its own bad behaviours, although in truth I think it's a more comprehensive approach to it.
The issue is blind belief that either government or private sector is the best.
Why not give people the choice? I.E. if one believes Social Security is better than a 401(k) let them VOLUNTARILY put their money in Social Security and live with the outcome. If others believe a 401(k) is the better option, instead of making them be part of Social Security (all or just the income security portion of FICA taxes) let them choose. Maybe they choose 0-100% of the 6.2% portion of their FICA taxes to go into SS and a similar choice for the employer's matching 6.2% "contribution."
But just passing a law saying you must be part of this great plan we've developed may not be the best for all involved.
I know I could be retired in my mid-50s had I had control of the 12.4% taken each year and immediately spent instead of modestly invested in index funds.
That's a high-tech job that could be filled by another instead of me, if I had control over those funds.
Instead, I'm forced into SS where not only must I contribute, but I'll only see 30% of my indexed monthly income s a benefit vs the worker who paid closer to the minimum who will get 90% of his indexed monthly income at full retirement age.
It's a bad deal all the way around for me.
The basic point I am making is that, in a complex, modern society of 330 million people, it doesn’t always get to be about you. (Or me, or any single individual for that matter). The design of something like SSI and the issues involved are a lot more complex than just saying “I want my 12.4%, because I want it”. (And what makes you think for even an instant that the company you work for would be willing to turn over that 6.2% if they weren’t “forced” to by the government? They would be crying “freedom” more quickly, more loudly, and more effectively than you).
And, as recent years have shown, there is no guarantee that you could invest your money that successfully, or that other factors over which you have no control wouldn’t intervene. Then the rest of society would have to pitch in and support you. A society has to take the long view of what is the best fit for everyone. I understand your point, but I think you are making the common mistake of seeing things only from the point of view of your narrow self-interest (not meant as criticism). The track record of the “voluntary” system you favor overall is not encouraging. We are going to be facing a crisis in the future because the vast majority of people in 401K plans have done a pretty poor job of investing—partly because they haven’t been able to invest much, partly because they aren’t very good at investing, and partly because their earnings are sharply reduced by fees that are charged (401K plans are in large part government-sponsored welfare programs for banks).
Obviously, you think you are the outlier. And you very well could be. And so from your perspective, it seems unfair that you are “forced” into a system that you think puts you at a disadvantage. And that could very well be true. My feeling is that society cannot risk having millions of elderly, impoverished citizens, just so that a special few (like you and me) can do better. IMO, that might suck, but that’s the price you pay for living in a modern nation with all the benefits that America has to offer. Overall, it’s not such a bad deal.
I didn’t read all of it, but this site seemed to be a honest attempt to lay out the pros and cons:
https://socialsecurity.procon.org/
The problem with SSI is 1) if I could have taken that 12.4% and invested it myself in the same portfolio as my 401k I would have a very good return and benefits far exceeding what I will draw from SSI some day. 2) I can start withdrawing from my 401k at 59.5 years old, while I have to wait until I'm 67 to get my full SSI benefit. So by being locked into a non-customizable SSI program, I get less money and I get it later.
I get that many people do not want to invest their own SSI - for those, they can opt for the old system and have a static benefit available. For the rest of us - it is our benefit that we are paying into, so let us have some control over it.
Again....SS doesn't exist for you or me or people who have enough money and work in a professional career to invest in a matched 401k. It isn't there so that I can retire and get a boat instead of not being able to get a boat. Yeah our ROI putting into SS isn't as good as putting into a 401k. That is because all we put into a 401k goes to us...not all we put into SS goes to us, some of it goes to other people who need it....like truly need it.
If you and I pay into SS then SS has enough funds to take care of the sewer maintenance worker who worked every day of their life until 60 when their knees were failing and they could work no more but still lived to the age of 85. To make sure they had at least enough for a plate of rice and beans and a roof over there head.
If you and I instead took that money and put it into a 401k that 401k isn't going to be giving anything to that sewer maintenance worker at all...we are just going to be able to afford that boat. So what system is in place to make sure that person, who worked dutifully and provided a service that we all benefit from, doesn't die destitute in a ditch somewhere?
The only answer people seem to have for that is "Charity". But honestly if there was a Charity that was large enough and distributed enough to do what the government does with social security then how exactly would it not have the same logistical and financial issues and need for everyone to contribute?
The sewer maintenance worker and everyone else benefits when the SSI dollars collected are permitted to be invested responsibly. A minimum benefit level can still be established for those that fall short, but having money that gathers dust and doesn’t grow is extremely irresponsible and wasteful and benefits no one.
If the SSI funds were allowed to be invested individually and the sewer worker’s lifetime contributions and growth did not reach a minimum benefit threshold (I think the max right now is around$2,600), I’m all for the government bridging that gap so the guy still gets his $2,600 per month. Meanwhile, if I had been able to invest my own SSI contributions in the same funds as my 401k all of these years, I would be able to at least double my benefit when I retire. This is not to “buy a boat”, this is to achieve an income and lifestyle that is ballpark what I live on today, which I don’t think is unreasonable after working hard my entire adult life.
So your assumption is that the government does not invest or utilize SS funds or that they invest them in a sub-optimal way? Can you back that up with something showing where SS funds are going or are you just assuming that?
No assumptions. (This is data you could have looked up independent of me).
This chart is the interest earned by the OASDI (SS trust fund) - care to put your own funds into this? Meanwhile, the stock market is making record gains.
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Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »tbright1965 wrote: »MeanderingMammal wrote: »tbright1965 wrote: »
No, my point is contrary to the post quoted, I found the 401(k) to be superior to Social Security and that there was not incentive for the military to lower costs. Even when contracted out, unless the branch spending the money has an incentive to spend less, they will spend every dollar allocated, even if the goods or services are not needed.MeanderingMammal wrote: »tbright1965 wrote: »When I was in the military, people are rated based on the size of their kingdom. If an organization had money left over at the end of the fiscal year, they didn't return it for others to use. They spent it so they would get as much if not more the next fiscal year.
I'm not entirely clear on your point here. Are you suggesting that the delivery of military effect is something that should be provided by the private sector?
So the issue isn't with the delivery of military effect being a government function?
I'd agree that the behaviours that incremental budgeting encourages are unhelpful, but that's an issue with the budgeting technique rather than public services.
Zero based budgeting encourages its own bad behaviours, although in truth I think it's a more comprehensive approach to it.
The issue is blind belief that either government or private sector is the best.
Why not give people the choice? I.E. if one believes Social Security is better than a 401(k) let them VOLUNTARILY put their money in Social Security and live with the outcome. If others believe a 401(k) is the better option, instead of making them be part of Social Security (all or just the income security portion of FICA taxes) let them choose. Maybe they choose 0-100% of the 6.2% portion of their FICA taxes to go into SS and a similar choice for the employer's matching 6.2% "contribution."
But just passing a law saying you must be part of this great plan we've developed may not be the best for all involved.
I know I could be retired in my mid-50s had I had control of the 12.4% taken each year and immediately spent instead of modestly invested in index funds.
That's a high-tech job that could be filled by another instead of me, if I had control over those funds.
Instead, I'm forced into SS where not only must I contribute, but I'll only see 30% of my indexed monthly income s a benefit vs the worker who paid closer to the minimum who will get 90% of his indexed monthly income at full retirement age.
It's a bad deal all the way around for me.
The basic point I am making is that, in a complex, modern society of 330 million people, it doesn’t always get to be about you. (Or me, or any single individual for that matter). The design of something like SSI and the issues involved are a lot more complex than just saying “I want my 12.4%, because I want it”. (And what makes you think for even an instant that the company you work for would be willing to turn over that 6.2% if they weren’t “forced” to by the government? They would be crying “freedom” more quickly, more loudly, and more effectively than you).
And, as recent years have shown, there is no guarantee that you could invest your money that successfully, or that other factors over which you have no control wouldn’t intervene. Then the rest of society would have to pitch in and support you. A society has to take the long view of what is the best fit for everyone. I understand your point, but I think you are making the common mistake of seeing things only from the point of view of your narrow self-interest (not meant as criticism). The track record of the “voluntary” system you favor overall is not encouraging. We are going to be facing a crisis in the future because the vast majority of people in 401K plans have done a pretty poor job of investing—partly because they haven’t been able to invest much, partly because they aren’t very good at investing, and partly because their earnings are sharply reduced by fees that are charged (401K plans are in large part government-sponsored welfare programs for banks).
Obviously, you think you are the outlier. And you very well could be. And so from your perspective, it seems unfair that you are “forced” into a system that you think puts you at a disadvantage. And that could very well be true. My feeling is that society cannot risk having millions of elderly, impoverished citizens, just so that a special few (like you and me) can do better. IMO, that might suck, but that’s the price you pay for living in a modern nation with all the benefits that America has to offer. Overall, it’s not such a bad deal.
I didn’t read all of it, but this site seemed to be a honest attempt to lay out the pros and cons:
https://socialsecurity.procon.org/
The problem with SSI is 1) if I could have taken that 12.4% and invested it myself in the same portfolio as my 401k I would have a very good return and benefits far exceeding what I will draw from SSI some day. 2) I can start withdrawing from my 401k at 59.5 years old, while I have to wait until I'm 67 to get my full SSI benefit. So by being locked into a non-customizable SSI program, I get less money and I get it later.
I get that many people do not want to invest their own SSI - for those, they can opt for the old system and have a static benefit available. For the rest of us - it is our benefit that we are paying into, so let us have some control over it.
Again....SS doesn't exist for you or me or people who have enough money and work in a professional career to invest in a matched 401k. It isn't there so that I can retire and get a boat instead of not being able to get a boat. Yeah our ROI putting into SS isn't as good as putting into a 401k. That is because all we put into a 401k goes to us...not all we put into SS goes to us, some of it goes to other people who need it....like truly need it.
If you and I pay into SS then SS has enough funds to take care of the sewer maintenance worker who worked every day of their life until 60 when their knees were failing and they could work no more but still lived to the age of 85. To make sure they had at least enough for a plate of rice and beans and a roof over there head.
If you and I instead took that money and put it into a 401k that 401k isn't going to be giving anything to that sewer maintenance worker at all...we are just going to be able to afford that boat. So what system is in place to make sure that person, who worked dutifully and provided a service that we all benefit from, doesn't die destitute in a ditch somewhere?
The only answer people seem to have for that is "Charity". But honestly if there was a Charity that was large enough and distributed enough to do what the government does with social security then how exactly would it not have the same logistical and financial issues and need for everyone to contribute?
The sewer maintenance worker and everyone else benefits when the SSI dollars collected are permitted to be invested responsibly. A minimum benefit level can still be established for those that fall short, but having money that gathers dust and doesn’t grow is extremely irresponsible and wasteful and benefits no one.
If the SSI funds were allowed to be invested individually and the sewer worker’s lifetime contributions and growth did not reach a minimum benefit threshold (I think the max right now is around$2,600), I’m all for the government bridging that gap so the guy still gets his $2,600 per month. Meanwhile, if I had been able to invest my own SSI contributions in the same funds as my 401k all of these years, I would be able to at least double my benefit when I retire. This is not to “buy a boat”, this is to achieve an income and lifestyle that is ballpark what I live on today, which I don’t think is unreasonable after working hard my entire adult life.
So your assumption is that the government does not invest or utilize SS funds or that they invest them in a sub-optimal way? Can you back that up with something showing where SS funds are going or are you just assuming that?
No assumptions. (This is data you could have looked up independent of me).
This chart is the interest earned by the OASDI (SS trust fund) - care to put your own funds into this? Meanwhile, the stock market is making record gains.
You are comparing a 401k when you are still working to social security which is paying out to people as we speak. A 401k you put money into, you don't touch it until retirement. It makes sense to put money into a more volatile stock-heavy fund when you are younger and then transition that into a more secure bond-based fund when you are older and getting closer to pulling money out. When it is stock heavy the returns (and the loses) are larger. By the time you are pulling money out that 401k would be invested into a fund that does not "boom" when the stock market booms because it would be in bonds. The real comparison would be between social security funds and 401k funds that are paying out. The fact that social security has an interest return means that it is being invested, not "sitting on a shelf collecting dust". So, what is the interest a typical 401k returns when you are 65 and recieving payouts?
Social security is constantly in a state of paying out...maybe not to you personally right now, but to millions of people. It is therefore wise to have that money invested into a stable fund much like your 401k will be when you are retiring. If the government put that money into stocks and the market crashed then sewer worker wouldn't be getting his check anymore.
Again, if you agree that the sewer worker should have a minimum retirement benefit paid out by the government and obviously the government gets its money through taxes what exactly should we call that tax if it isn't called social security and how would that tax be any different that what social security tax currently is which is an income based tax put into bond style funds to payout to people who are at retirement age?
To answer your question for myself personally and for my own money I would put my money into a 401k that invests in stocks because I am 39 years old. If I agreed we should have funding to keep people in poverty able to eat and have housing after retirement and that I should contribute to that then I would want to put that contribution into a stable bond-style fund so that it was stable and can be used day to day to make payouts to people who are currently retired.1 -
Aaron_K123 wrote: »Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »tbright1965 wrote: »MeanderingMammal wrote: »tbright1965 wrote: »
No, my point is contrary to the post quoted, I found the 401(k) to be superior to Social Security and that there was not incentive for the military to lower costs. Even when contracted out, unless the branch spending the money has an incentive to spend less, they will spend every dollar allocated, even if the goods or services are not needed.MeanderingMammal wrote: »tbright1965 wrote: »When I was in the military, people are rated based on the size of their kingdom. If an organization had money left over at the end of the fiscal year, they didn't return it for others to use. They spent it so they would get as much if not more the next fiscal year.
I'm not entirely clear on your point here. Are you suggesting that the delivery of military effect is something that should be provided by the private sector?
So the issue isn't with the delivery of military effect being a government function?
I'd agree that the behaviours that incremental budgeting encourages are unhelpful, but that's an issue with the budgeting technique rather than public services.
Zero based budgeting encourages its own bad behaviours, although in truth I think it's a more comprehensive approach to it.
The issue is blind belief that either government or private sector is the best.
Why not give people the choice? I.E. if one believes Social Security is better than a 401(k) let them VOLUNTARILY put their money in Social Security and live with the outcome. If others believe a 401(k) is the better option, instead of making them be part of Social Security (all or just the income security portion of FICA taxes) let them choose. Maybe they choose 0-100% of the 6.2% portion of their FICA taxes to go into SS and a similar choice for the employer's matching 6.2% "contribution."
But just passing a law saying you must be part of this great plan we've developed may not be the best for all involved.
I know I could be retired in my mid-50s had I had control of the 12.4% taken each year and immediately spent instead of modestly invested in index funds.
That's a high-tech job that could be filled by another instead of me, if I had control over those funds.
Instead, I'm forced into SS where not only must I contribute, but I'll only see 30% of my indexed monthly income s a benefit vs the worker who paid closer to the minimum who will get 90% of his indexed monthly income at full retirement age.
It's a bad deal all the way around for me.
The basic point I am making is that, in a complex, modern society of 330 million people, it doesn’t always get to be about you. (Or me, or any single individual for that matter). The design of something like SSI and the issues involved are a lot more complex than just saying “I want my 12.4%, because I want it”. (And what makes you think for even an instant that the company you work for would be willing to turn over that 6.2% if they weren’t “forced” to by the government? They would be crying “freedom” more quickly, more loudly, and more effectively than you).
And, as recent years have shown, there is no guarantee that you could invest your money that successfully, or that other factors over which you have no control wouldn’t intervene. Then the rest of society would have to pitch in and support you. A society has to take the long view of what is the best fit for everyone. I understand your point, but I think you are making the common mistake of seeing things only from the point of view of your narrow self-interest (not meant as criticism). The track record of the “voluntary” system you favor overall is not encouraging. We are going to be facing a crisis in the future because the vast majority of people in 401K plans have done a pretty poor job of investing—partly because they haven’t been able to invest much, partly because they aren’t very good at investing, and partly because their earnings are sharply reduced by fees that are charged (401K plans are in large part government-sponsored welfare programs for banks).
Obviously, you think you are the outlier. And you very well could be. And so from your perspective, it seems unfair that you are “forced” into a system that you think puts you at a disadvantage. And that could very well be true. My feeling is that society cannot risk having millions of elderly, impoverished citizens, just so that a special few (like you and me) can do better. IMO, that might suck, but that’s the price you pay for living in a modern nation with all the benefits that America has to offer. Overall, it’s not such a bad deal.
I didn’t read all of it, but this site seemed to be a honest attempt to lay out the pros and cons:
https://socialsecurity.procon.org/
The problem with SSI is 1) if I could have taken that 12.4% and invested it myself in the same portfolio as my 401k I would have a very good return and benefits far exceeding what I will draw from SSI some day. 2) I can start withdrawing from my 401k at 59.5 years old, while I have to wait until I'm 67 to get my full SSI benefit. So by being locked into a non-customizable SSI program, I get less money and I get it later.
I get that many people do not want to invest their own SSI - for those, they can opt for the old system and have a static benefit available. For the rest of us - it is our benefit that we are paying into, so let us have some control over it.
Again....SS doesn't exist for you or me or people who have enough money and work in a professional career to invest in a matched 401k. It isn't there so that I can retire and get a boat instead of not being able to get a boat. Yeah our ROI putting into SS isn't as good as putting into a 401k. That is because all we put into a 401k goes to us...not all we put into SS goes to us, some of it goes to other people who need it....like truly need it.
If you and I pay into SS then SS has enough funds to take care of the sewer maintenance worker who worked every day of their life until 60 when their knees were failing and they could work no more but still lived to the age of 85. To make sure they had at least enough for a plate of rice and beans and a roof over there head.
If you and I instead took that money and put it into a 401k that 401k isn't going to be giving anything to that sewer maintenance worker at all...we are just going to be able to afford that boat. So what system is in place to make sure that person, who worked dutifully and provided a service that we all benefit from, doesn't die destitute in a ditch somewhere?
The only answer people seem to have for that is "Charity". But honestly if there was a Charity that was large enough and distributed enough to do what the government does with social security then how exactly would it not have the same logistical and financial issues and need for everyone to contribute?
The sewer maintenance worker and everyone else benefits when the SSI dollars collected are permitted to be invested responsibly. A minimum benefit level can still be established for those that fall short, but having money that gathers dust and doesn’t grow is extremely irresponsible and wasteful and benefits no one.
If the SSI funds were allowed to be invested individually and the sewer worker’s lifetime contributions and growth did not reach a minimum benefit threshold (I think the max right now is around$2,600), I’m all for the government bridging that gap so the guy still gets his $2,600 per month. Meanwhile, if I had been able to invest my own SSI contributions in the same funds as my 401k all of these years, I would be able to at least double my benefit when I retire. This is not to “buy a boat”, this is to achieve an income and lifestyle that is ballpark what I live on today, which I don’t think is unreasonable after working hard my entire adult life.
So your assumption is that the government does not invest or utilize SS funds or that they invest them in a sub-optimal way? Can you back that up with something showing where SS funds are going or are you just assuming that?
No assumptions. (This is data you could have looked up independent of me).
This chart is the interest earned by the OASDI (SS trust fund) - care to put your own funds into this? Meanwhile, the stock market is making record gains.
You are comparing a 401k when you are still working to social security which is paying out to people as we speak. A 401k you put money into, you don't touch it until retirement. It makes sense to put money into a more volatile stock-heavy fund when you are younger and then transition that into a more secure bond-based fund when you are older and getting closer to pulling money out. When it is stock heavy the returns (and the loses) are larger. By the time you are pulling money out that 401k would be invested into a fund that does not "boom" when the stock market booms because it would be in bonds. The real comparison would be between social security funds and 401k funds that are paying out. The fact that social security has an interest return means that it is being invested, not "sitting on a shelf collecting dust". So, what is the interest a typical 401k returns when you are 65 and recieving payouts?
Social security is constantly in a state of paying out...maybe not to you personally right now, but to millions of people. It is therefore wise to have that money invested into a stable fund much like your 401k will be when you are retiring. If the government put that money into stocks and the market crashed then sewer worker wouldn't be getting his check anymore.
Again, if you agree that the sewer worker should have a minimum retirement benefit paid out by the government and obviously the government gets its money through taxes what exactly should we call that tax if it isn't called social security and how would that tax be any different that what social security tax currently is which is an income based tax put into bond style funds to payout to people who are at retirement age?
To answer your question for myself personally and for my own money I would put my money into a 401k that invests in stocks because I am 39 years old. If I agreed we should have funding to keep people in poverty able to eat and have housing after retirement and that I should contribute to that then I would want to put that contribution into a stable bond-style fund so that it was stable and can be used day to day to make payouts to people who are currently retired.
Yes, the OASDI does pay out funds, but that has nothing to do with the rate of return realized, that effects the absolute earnings in dollars.
I'm not saying that we should be able to invest our SS withholdings into something volatile and risky like Bitcoin, but there are safe index funds (similar to what federal government employees use for their 401k) that run circles around what the OASDI fund earns.0 -
Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »tbright1965 wrote: »MeanderingMammal wrote: »tbright1965 wrote: »
No, my point is contrary to the post quoted, I found the 401(k) to be superior to Social Security and that there was not incentive for the military to lower costs. Even when contracted out, unless the branch spending the money has an incentive to spend less, they will spend every dollar allocated, even if the goods or services are not needed.MeanderingMammal wrote: »tbright1965 wrote: »When I was in the military, people are rated based on the size of their kingdom. If an organization had money left over at the end of the fiscal year, they didn't return it for others to use. They spent it so they would get as much if not more the next fiscal year.
I'm not entirely clear on your point here. Are you suggesting that the delivery of military effect is something that should be provided by the private sector?
So the issue isn't with the delivery of military effect being a government function?
I'd agree that the behaviours that incremental budgeting encourages are unhelpful, but that's an issue with the budgeting technique rather than public services.
Zero based budgeting encourages its own bad behaviours, although in truth I think it's a more comprehensive approach to it.
The issue is blind belief that either government or private sector is the best.
Why not give people the choice? I.E. if one believes Social Security is better than a 401(k) let them VOLUNTARILY put their money in Social Security and live with the outcome. If others believe a 401(k) is the better option, instead of making them be part of Social Security (all or just the income security portion of FICA taxes) let them choose. Maybe they choose 0-100% of the 6.2% portion of their FICA taxes to go into SS and a similar choice for the employer's matching 6.2% "contribution."
But just passing a law saying you must be part of this great plan we've developed may not be the best for all involved.
I know I could be retired in my mid-50s had I had control of the 12.4% taken each year and immediately spent instead of modestly invested in index funds.
That's a high-tech job that could be filled by another instead of me, if I had control over those funds.
Instead, I'm forced into SS where not only must I contribute, but I'll only see 30% of my indexed monthly income s a benefit vs the worker who paid closer to the minimum who will get 90% of his indexed monthly income at full retirement age.
It's a bad deal all the way around for me.
The basic point I am making is that, in a complex, modern society of 330 million people, it doesn’t always get to be about you. (Or me, or any single individual for that matter). The design of something like SSI and the issues involved are a lot more complex than just saying “I want my 12.4%, because I want it”. (And what makes you think for even an instant that the company you work for would be willing to turn over that 6.2% if they weren’t “forced” to by the government? They would be crying “freedom” more quickly, more loudly, and more effectively than you).
And, as recent years have shown, there is no guarantee that you could invest your money that successfully, or that other factors over which you have no control wouldn’t intervene. Then the rest of society would have to pitch in and support you. A society has to take the long view of what is the best fit for everyone. I understand your point, but I think you are making the common mistake of seeing things only from the point of view of your narrow self-interest (not meant as criticism). The track record of the “voluntary” system you favor overall is not encouraging. We are going to be facing a crisis in the future because the vast majority of people in 401K plans have done a pretty poor job of investing—partly because they haven’t been able to invest much, partly because they aren’t very good at investing, and partly because their earnings are sharply reduced by fees that are charged (401K plans are in large part government-sponsored welfare programs for banks).
Obviously, you think you are the outlier. And you very well could be. And so from your perspective, it seems unfair that you are “forced” into a system that you think puts you at a disadvantage. And that could very well be true. My feeling is that society cannot risk having millions of elderly, impoverished citizens, just so that a special few (like you and me) can do better. IMO, that might suck, but that’s the price you pay for living in a modern nation with all the benefits that America has to offer. Overall, it’s not such a bad deal.
I didn’t read all of it, but this site seemed to be a honest attempt to lay out the pros and cons:
https://socialsecurity.procon.org/
The problem with SSI is 1) if I could have taken that 12.4% and invested it myself in the same portfolio as my 401k I would have a very good return and benefits far exceeding what I will draw from SSI some day. 2) I can start withdrawing from my 401k at 59.5 years old, while I have to wait until I'm 67 to get my full SSI benefit. So by being locked into a non-customizable SSI program, I get less money and I get it later.
I get that many people do not want to invest their own SSI - for those, they can opt for the old system and have a static benefit available. For the rest of us - it is our benefit that we are paying into, so let us have some control over it.
Again....SS doesn't exist for you or me or people who have enough money and work in a professional career to invest in a matched 401k. It isn't there so that I can retire and get a boat instead of not being able to get a boat. Yeah our ROI putting into SS isn't as good as putting into a 401k. That is because all we put into a 401k goes to us...not all we put into SS goes to us, some of it goes to other people who need it....like truly need it.
If you and I pay into SS then SS has enough funds to take care of the sewer maintenance worker who worked every day of their life until 60 when their knees were failing and they could work no more but still lived to the age of 85. To make sure they had at least enough for a plate of rice and beans and a roof over there head.
If you and I instead took that money and put it into a 401k that 401k isn't going to be giving anything to that sewer maintenance worker at all...we are just going to be able to afford that boat. So what system is in place to make sure that person, who worked dutifully and provided a service that we all benefit from, doesn't die destitute in a ditch somewhere?
The only answer people seem to have for that is "Charity". But honestly if there was a Charity that was large enough and distributed enough to do what the government does with social security then how exactly would it not have the same logistical and financial issues and need for everyone to contribute?
The sewer maintenance worker and everyone else benefits when the SSI dollars collected are permitted to be invested responsibly. A minimum benefit level can still be established for those that fall short, but having money that gathers dust and doesn’t grow is extremely irresponsible and wasteful and benefits no one.
If the SSI funds were allowed to be invested individually and the sewer worker’s lifetime contributions and growth did not reach a minimum benefit threshold (I think the max right now is around$2,600), I’m all for the government bridging that gap so the guy still gets his $2,600 per month. Meanwhile, if I had been able to invest my own SSI contributions in the same funds as my 401k all of these years, I would be able to at least double my benefit when I retire. This is not to “buy a boat”, this is to achieve an income and lifestyle that is ballpark what I live on today, which I don’t think is unreasonable after working hard my entire adult life.
So your assumption is that the government does not invest or utilize SS funds or that they invest them in a sub-optimal way? Can you back that up with something showing where SS funds are going or are you just assuming that?
No assumptions. (This is data you could have looked up independent of me).
This chart is the interest earned by the OASDI (SS trust fund) - care to put your own funds into this? Meanwhile, the stock market is making record gains.
You are comparing a 401k when you are still working to social security which is paying out to people as we speak. A 401k you put money into, you don't touch it until retirement. It makes sense to put money into a more volatile stock-heavy fund when you are younger and then transition that into a more secure bond-based fund when you are older and getting closer to pulling money out. When it is stock heavy the returns (and the loses) are larger. By the time you are pulling money out that 401k would be invested into a fund that does not "boom" when the stock market booms because it would be in bonds. The real comparison would be between social security funds and 401k funds that are paying out. The fact that social security has an interest return means that it is being invested, not "sitting on a shelf collecting dust". So, what is the interest a typical 401k returns when you are 65 and recieving payouts?
Social security is constantly in a state of paying out...maybe not to you personally right now, but to millions of people. It is therefore wise to have that money invested into a stable fund much like your 401k will be when you are retiring. If the government put that money into stocks and the market crashed then sewer worker wouldn't be getting his check anymore.
Again, if you agree that the sewer worker should have a minimum retirement benefit paid out by the government and obviously the government gets its money through taxes what exactly should we call that tax if it isn't called social security and how would that tax be any different that what social security tax currently is which is an income based tax put into bond style funds to payout to people who are at retirement age?
To answer your question for myself personally and for my own money I would put my money into a 401k that invests in stocks because I am 39 years old. If I agreed we should have funding to keep people in poverty able to eat and have housing after retirement and that I should contribute to that then I would want to put that contribution into a stable bond-style fund so that it was stable and can be used day to day to make payouts to people who are currently retired.
Yes, the OASDI does pay out funds, but that has nothing to do with the rate of return realized, that effects the absolute earnings in dollars.
I'm not saying that we should be able to invest our SS withholdings into something volatile and risky like Bitcoin, but there are safe index funds (similar to what federal government employees use for their 401k) that run circles around what the OASDI fund earns.
Well I don't know that that is for sure true but if it were true that the government could increase the holdings in SS simply by moving the investment to another holding and that that holding would be just as stable and that there was no reason not to other than corruption or laziness or bureaucracy then yeah that would be a problem that needs to be addressed. Clearly I have no interest (no pun intended) in waste or frivolity when it comes to my money....I just do believe there should be a government funded social safety net for retirement that is funded through an income based tax. How that money is invested I leave to economists and other people more knowledgeable than myself. Perhaps you consider me a fool to place that trust in which case so be it. I do respect your opinion here and I don't think it is ridiculous to be concerned about how our tax dollars are allocated so I can understand where you are coming from. I'd just say the battlefront is on how to invest, allocate and distribute SS funds not on whether or not SS should exist in some form.2 -
Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »tbright1965 wrote: »MeanderingMammal wrote: »tbright1965 wrote: »
No, my point is contrary to the post quoted, I found the 401(k) to be superior to Social Security and that there was not incentive for the military to lower costs. Even when contracted out, unless the branch spending the money has an incentive to spend less, they will spend every dollar allocated, even if the goods or services are not needed.MeanderingMammal wrote: »tbright1965 wrote: »When I was in the military, people are rated based on the size of their kingdom. If an organization had money left over at the end of the fiscal year, they didn't return it for others to use. They spent it so they would get as much if not more the next fiscal year.
I'm not entirely clear on your point here. Are you suggesting that the delivery of military effect is something that should be provided by the private sector?
So the issue isn't with the delivery of military effect being a government function?
I'd agree that the behaviours that incremental budgeting encourages are unhelpful, but that's an issue with the budgeting technique rather than public services.
Zero based budgeting encourages its own bad behaviours, although in truth I think it's a more comprehensive approach to it.
The issue is blind belief that either government or private sector is the best.
Why not give people the choice? I.E. if one believes Social Security is better than a 401(k) let them VOLUNTARILY put their money in Social Security and live with the outcome. If others believe a 401(k) is the better option, instead of making them be part of Social Security (all or just the income security portion of FICA taxes) let them choose. Maybe they choose 0-100% of the 6.2% portion of their FICA taxes to go into SS and a similar choice for the employer's matching 6.2% "contribution."
But just passing a law saying you must be part of this great plan we've developed may not be the best for all involved.
I know I could be retired in my mid-50s had I had control of the 12.4% taken each year and immediately spent instead of modestly invested in index funds.
That's a high-tech job that could be filled by another instead of me, if I had control over those funds.
Instead, I'm forced into SS where not only must I contribute, but I'll only see 30% of my indexed monthly income s a benefit vs the worker who paid closer to the minimum who will get 90% of his indexed monthly income at full retirement age.
It's a bad deal all the way around for me.
The basic point I am making is that, in a complex, modern society of 330 million people, it doesn’t always get to be about you. (Or me, or any single individual for that matter). The design of something like SSI and the issues involved are a lot more complex than just saying “I want my 12.4%, because I want it”. (And what makes you think for even an instant that the company you work for would be willing to turn over that 6.2% if they weren’t “forced” to by the government? They would be crying “freedom” more quickly, more loudly, and more effectively than you).
And, as recent years have shown, there is no guarantee that you could invest your money that successfully, or that other factors over which you have no control wouldn’t intervene. Then the rest of society would have to pitch in and support you. A society has to take the long view of what is the best fit for everyone. I understand your point, but I think you are making the common mistake of seeing things only from the point of view of your narrow self-interest (not meant as criticism). The track record of the “voluntary” system you favor overall is not encouraging. We are going to be facing a crisis in the future because the vast majority of people in 401K plans have done a pretty poor job of investing—partly because they haven’t been able to invest much, partly because they aren’t very good at investing, and partly because their earnings are sharply reduced by fees that are charged (401K plans are in large part government-sponsored welfare programs for banks).
Obviously, you think you are the outlier. And you very well could be. And so from your perspective, it seems unfair that you are “forced” into a system that you think puts you at a disadvantage. And that could very well be true. My feeling is that society cannot risk having millions of elderly, impoverished citizens, just so that a special few (like you and me) can do better. IMO, that might suck, but that’s the price you pay for living in a modern nation with all the benefits that America has to offer. Overall, it’s not such a bad deal.
I didn’t read all of it, but this site seemed to be a honest attempt to lay out the pros and cons:
https://socialsecurity.procon.org/
The problem with SSI is 1) if I could have taken that 12.4% and invested it myself in the same portfolio as my 401k I would have a very good return and benefits far exceeding what I will draw from SSI some day. 2) I can start withdrawing from my 401k at 59.5 years old, while I have to wait until I'm 67 to get my full SSI benefit. So by being locked into a non-customizable SSI program, I get less money and I get it later.
I get that many people do not want to invest their own SSI - for those, they can opt for the old system and have a static benefit available. For the rest of us - it is our benefit that we are paying into, so let us have some control over it.
Again....SS doesn't exist for you or me or people who have enough money and work in a professional career to invest in a matched 401k. It isn't there so that I can retire and get a boat instead of not being able to get a boat. Yeah our ROI putting into SS isn't as good as putting into a 401k. That is because all we put into a 401k goes to us...not all we put into SS goes to us, some of it goes to other people who need it....like truly need it.
If you and I pay into SS then SS has enough funds to take care of the sewer maintenance worker who worked every day of their life until 60 when their knees were failing and they could work no more but still lived to the age of 85. To make sure they had at least enough for a plate of rice and beans and a roof over there head.
If you and I instead took that money and put it into a 401k that 401k isn't going to be giving anything to that sewer maintenance worker at all...we are just going to be able to afford that boat. So what system is in place to make sure that person, who worked dutifully and provided a service that we all benefit from, doesn't die destitute in a ditch somewhere?
The only answer people seem to have for that is "Charity". But honestly if there was a Charity that was large enough and distributed enough to do what the government does with social security then how exactly would it not have the same logistical and financial issues and need for everyone to contribute?
The sewer maintenance worker and everyone else benefits when the SSI dollars collected are permitted to be invested responsibly. A minimum benefit level can still be established for those that fall short, but having money that gathers dust and doesn’t grow is extremely irresponsible and wasteful and benefits no one.
If the SSI funds were allowed to be invested individually and the sewer worker’s lifetime contributions and growth did not reach a minimum benefit threshold (I think the max right now is around$2,600), I’m all for the government bridging that gap so the guy still gets his $2,600 per month. Meanwhile, if I had been able to invest my own SSI contributions in the same funds as my 401k all of these years, I would be able to at least double my benefit when I retire. This is not to “buy a boat”, this is to achieve an income and lifestyle that is ballpark what I live on today, which I don’t think is unreasonable after working hard my entire adult life.
So your assumption is that the government does not invest or utilize SS funds or that they invest them in a sub-optimal way? Can you back that up with something showing where SS funds are going or are you just assuming that?
No assumptions. (This is data you could have looked up independent of me).
This chart is the interest earned by the OASDI (SS trust fund) - care to put your own funds into this? Meanwhile, the stock market is making record gains.
Given the nature of the fund, I'd expect the objective to be primarily stability - near-maximum risk reduction. There is no risk-free rate of return, but the 3-month T-bill rate is sometimes used as the closest actual proxy. Just by eyeballing a few points, the OASDI return appears generally to track slightly above the 3-month T-bill historic rates. (
Wonder why that is - LOL!)Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »tbright1965 wrote: »MeanderingMammal wrote: »tbright1965 wrote: »
No, my point is contrary to the post quoted, I found the 401(k) to be superior to Social Security and that there was not incentive for the military to lower costs. Even when contracted out, unless the branch spending the money has an incentive to spend less, they will spend every dollar allocated, even if the goods or services are not needed.MeanderingMammal wrote: »tbright1965 wrote: »When I was in the military, people are rated based on the size of their kingdom. If an organization had money left over at the end of the fiscal year, they didn't return it for others to use. They spent it so they would get as much if not more the next fiscal year.
I'm not entirely clear on your point here. Are you suggesting that the delivery of military effect is something that should be provided by the private sector?
So the issue isn't with the delivery of military effect being a government function?
I'd agree that the behaviours that incremental budgeting encourages are unhelpful, but that's an issue with the budgeting technique rather than public services.
Zero based budgeting encourages its own bad behaviours, although in truth I think it's a more comprehensive approach to it.
The issue is blind belief that either government or private sector is the best.
Why not give people the choice? I.E. if one believes Social Security is better than a 401(k) let them VOLUNTARILY put their money in Social Security and live with the outcome. If others believe a 401(k) is the better option, instead of making them be part of Social Security (all or just the income security portion of FICA taxes) let them choose. Maybe they choose 0-100% of the 6.2% portion of their FICA taxes to go into SS and a similar choice for the employer's matching 6.2% "contribution."
But just passing a law saying you must be part of this great plan we've developed may not be the best for all involved.
I know I could be retired in my mid-50s had I had control of the 12.4% taken each year and immediately spent instead of modestly invested in index funds.
That's a high-tech job that could be filled by another instead of me, if I had control over those funds.
Instead, I'm forced into SS where not only must I contribute, but I'll only see 30% of my indexed monthly income s a benefit vs the worker who paid closer to the minimum who will get 90% of his indexed monthly income at full retirement age.
It's a bad deal all the way around for me.
The basic point I am making is that, in a complex, modern society of 330 million people, it doesn’t always get to be about you. (Or me, or any single individual for that matter). The design of something like SSI and the issues involved are a lot more complex than just saying “I want my 12.4%, because I want it”. (And what makes you think for even an instant that the company you work for would be willing to turn over that 6.2% if they weren’t “forced” to by the government? They would be crying “freedom” more quickly, more loudly, and more effectively than you).
And, as recent years have shown, there is no guarantee that you could invest your money that successfully, or that other factors over which you have no control wouldn’t intervene. Then the rest of society would have to pitch in and support you. A society has to take the long view of what is the best fit for everyone. I understand your point, but I think you are making the common mistake of seeing things only from the point of view of your narrow self-interest (not meant as criticism). The track record of the “voluntary” system you favor overall is not encouraging. We are going to be facing a crisis in the future because the vast majority of people in 401K plans have done a pretty poor job of investing—partly because they haven’t been able to invest much, partly because they aren’t very good at investing, and partly because their earnings are sharply reduced by fees that are charged (401K plans are in large part government-sponsored welfare programs for banks).
Obviously, you think you are the outlier. And you very well could be. And so from your perspective, it seems unfair that you are “forced” into a system that you think puts you at a disadvantage. And that could very well be true. My feeling is that society cannot risk having millions of elderly, impoverished citizens, just so that a special few (like you and me) can do better. IMO, that might suck, but that’s the price you pay for living in a modern nation with all the benefits that America has to offer. Overall, it’s not such a bad deal.
I didn’t read all of it, but this site seemed to be a honest attempt to lay out the pros and cons:
https://socialsecurity.procon.org/
The problem with SSI is 1) if I could have taken that 12.4% and invested it myself in the same portfolio as my 401k I would have a very good return and benefits far exceeding what I will draw from SSI some day. 2) I can start withdrawing from my 401k at 59.5 years old, while I have to wait until I'm 67 to get my full SSI benefit. So by being locked into a non-customizable SSI program, I get less money and I get it later.
I get that many people do not want to invest their own SSI - for those, they can opt for the old system and have a static benefit available. For the rest of us - it is our benefit that we are paying into, so let us have some control over it.
Again....SS doesn't exist for you or me or people who have enough money and work in a professional career to invest in a matched 401k. It isn't there so that I can retire and get a boat instead of not being able to get a boat. Yeah our ROI putting into SS isn't as good as putting into a 401k. That is because all we put into a 401k goes to us...not all we put into SS goes to us, some of it goes to other people who need it....like truly need it.
If you and I pay into SS then SS has enough funds to take care of the sewer maintenance worker who worked every day of their life until 60 when their knees were failing and they could work no more but still lived to the age of 85. To make sure they had at least enough for a plate of rice and beans and a roof over there head.
If you and I instead took that money and put it into a 401k that 401k isn't going to be giving anything to that sewer maintenance worker at all...we are just going to be able to afford that boat. So what system is in place to make sure that person, who worked dutifully and provided a service that we all benefit from, doesn't die destitute in a ditch somewhere?
The only answer people seem to have for that is "Charity". But honestly if there was a Charity that was large enough and distributed enough to do what the government does with social security then how exactly would it not have the same logistical and financial issues and need for everyone to contribute?
The sewer maintenance worker and everyone else benefits when the SSI dollars collected are permitted to be invested responsibly. A minimum benefit level can still be established for those that fall short, but having money that gathers dust and doesn’t grow is extremely irresponsible and wasteful and benefits no one.
If the SSI funds were allowed to be invested individually and the sewer worker’s lifetime contributions and growth did not reach a minimum benefit threshold (I think the max right now is around$2,600), I’m all for the government bridging that gap so the guy still gets his $2,600 per month. Meanwhile, if I had been able to invest my own SSI contributions in the same funds as my 401k all of these years, I would be able to at least double my benefit when I retire. This is not to “buy a boat”, this is to achieve an income and lifestyle that is ballpark what I live on today, which I don’t think is unreasonable after working hard my entire adult life.
So your assumption is that the government does not invest or utilize SS funds or that they invest them in a sub-optimal way? Can you back that up with something showing where SS funds are going or are you just assuming that?
No assumptions. (This is data you could have looked up independent of me).
This chart is the interest earned by the OASDI (SS trust fund) - care to put your own funds into this? Meanwhile, the stock market is making record gains.
You are comparing a 401k when you are still working to social security which is paying out to people as we speak. A 401k you put money into, you don't touch it until retirement. It makes sense to put money into a more volatile stock-heavy fund when you are younger and then transition that into a more secure bond-based fund when you are older and getting closer to pulling money out. When it is stock heavy the returns (and the loses) are larger. By the time you are pulling money out that 401k would be invested into a fund that does not "boom" when the stock market booms because it would be in bonds. The real comparison would be between social security funds and 401k funds that are paying out. The fact that social security has an interest return means that it is being invested, not "sitting on a shelf collecting dust". So, what is the interest a typical 401k returns when you are 65 and recieving payouts?
Social security is constantly in a state of paying out...maybe not to you personally right now, but to millions of people. It is therefore wise to have that money invested into a stable fund much like your 401k will be when you are retiring. If the government put that money into stocks and the market crashed then sewer worker wouldn't be getting his check anymore.
Again, if you agree that the sewer worker should have a minimum retirement benefit paid out by the government and obviously the government gets its money through taxes what exactly should we call that tax if it isn't called social security and how would that tax be any different that what social security tax currently is which is an income based tax put into bond style funds to payout to people who are at retirement age?
To answer your question for myself personally and for my own money I would put my money into a 401k that invests in stocks because I am 39 years old. If I agreed we should have funding to keep people in poverty able to eat and have housing after retirement and that I should contribute to that then I would want to put that contribution into a stable bond-style fund so that it was stable and can be used day to day to make payouts to people who are currently retired.
Yes, the OASDI does pay out funds, but that has nothing to do with the rate of return realized, that effects the absolute earnings in dollars.
I'm not saying that we should be able to invest our SS withholdings into something volatile and risky like Bitcoin, but there are safe index funds (similar to what federal government employees use for their 401k) that run circles around what the OASDI fund earns.
"Safe Index Fund" is an oxymoron. Some are safer than others (underlying investments in stable companies, well-diversified, etc.). They're still built on market investments, and they still have risk of various types. (Yes, I know some mutual funds trade in things other than market investments. Those are less common types . . . and they're commonly riskier, not less risky, than those built on market investments.)3 -
Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »tbright1965 wrote: »MeanderingMammal wrote: »tbright1965 wrote: »
No, my point is contrary to the post quoted, I found the 401(k) to be superior to Social Security and that there was not incentive for the military to lower costs. Even when contracted out, unless the branch spending the money has an incentive to spend less, they will spend every dollar allocated, even if the goods or services are not needed.MeanderingMammal wrote: »tbright1965 wrote: »When I was in the military, people are rated based on the size of their kingdom. If an organization had money left over at the end of the fiscal year, they didn't return it for others to use. They spent it so they would get as much if not more the next fiscal year.
I'm not entirely clear on your point here. Are you suggesting that the delivery of military effect is something that should be provided by the private sector?
So the issue isn't with the delivery of military effect being a government function?
I'd agree that the behaviours that incremental budgeting encourages are unhelpful, but that's an issue with the budgeting technique rather than public services.
Zero based budgeting encourages its own bad behaviours, although in truth I think it's a more comprehensive approach to it.
The issue is blind belief that either government or private sector is the best.
Why not give people the choice? I.E. if one believes Social Security is better than a 401(k) let them VOLUNTARILY put their money in Social Security and live with the outcome. If others believe a 401(k) is the better option, instead of making them be part of Social Security (all or just the income security portion of FICA taxes) let them choose. Maybe they choose 0-100% of the 6.2% portion of their FICA taxes to go into SS and a similar choice for the employer's matching 6.2% "contribution."
But just passing a law saying you must be part of this great plan we've developed may not be the best for all involved.
I know I could be retired in my mid-50s had I had control of the 12.4% taken each year and immediately spent instead of modestly invested in index funds.
That's a high-tech job that could be filled by another instead of me, if I had control over those funds.
Instead, I'm forced into SS where not only must I contribute, but I'll only see 30% of my indexed monthly income s a benefit vs the worker who paid closer to the minimum who will get 90% of his indexed monthly income at full retirement age.
It's a bad deal all the way around for me.
The basic point I am making is that, in a complex, modern society of 330 million people, it doesn’t always get to be about you. (Or me, or any single individual for that matter). The design of something like SSI and the issues involved are a lot more complex than just saying “I want my 12.4%, because I want it”. (And what makes you think for even an instant that the company you work for would be willing to turn over that 6.2% if they weren’t “forced” to by the government? They would be crying “freedom” more quickly, more loudly, and more effectively than you).
And, as recent years have shown, there is no guarantee that you could invest your money that successfully, or that other factors over which you have no control wouldn’t intervene. Then the rest of society would have to pitch in and support you. A society has to take the long view of what is the best fit for everyone. I understand your point, but I think you are making the common mistake of seeing things only from the point of view of your narrow self-interest (not meant as criticism). The track record of the “voluntary” system you favor overall is not encouraging. We are going to be facing a crisis in the future because the vast majority of people in 401K plans have done a pretty poor job of investing—partly because they haven’t been able to invest much, partly because they aren’t very good at investing, and partly because their earnings are sharply reduced by fees that are charged (401K plans are in large part government-sponsored welfare programs for banks).
Obviously, you think you are the outlier. And you very well could be. And so from your perspective, it seems unfair that you are “forced” into a system that you think puts you at a disadvantage. And that could very well be true. My feeling is that society cannot risk having millions of elderly, impoverished citizens, just so that a special few (like you and me) can do better. IMO, that might suck, but that’s the price you pay for living in a modern nation with all the benefits that America has to offer. Overall, it’s not such a bad deal.
I didn’t read all of it, but this site seemed to be a honest attempt to lay out the pros and cons:
https://socialsecurity.procon.org/
The problem with SSI is 1) if I could have taken that 12.4% and invested it myself in the same portfolio as my 401k I would have a very good return and benefits far exceeding what I will draw from SSI some day. 2) I can start withdrawing from my 401k at 59.5 years old, while I have to wait until I'm 67 to get my full SSI benefit. So by being locked into a non-customizable SSI program, I get less money and I get it later.
I get that many people do not want to invest their own SSI - for those, they can opt for the old system and have a static benefit available. For the rest of us - it is our benefit that we are paying into, so let us have some control over it.
Again....SS doesn't exist for you or me or people who have enough money and work in a professional career to invest in a matched 401k. It isn't there so that I can retire and get a boat instead of not being able to get a boat. Yeah our ROI putting into SS isn't as good as putting into a 401k. That is because all we put into a 401k goes to us...not all we put into SS goes to us, some of it goes to other people who need it....like truly need it.
If you and I pay into SS then SS has enough funds to take care of the sewer maintenance worker who worked every day of their life until 60 when their knees were failing and they could work no more but still lived to the age of 85. To make sure they had at least enough for a plate of rice and beans and a roof over there head.
If you and I instead took that money and put it into a 401k that 401k isn't going to be giving anything to that sewer maintenance worker at all...we are just going to be able to afford that boat. So what system is in place to make sure that person, who worked dutifully and provided a service that we all benefit from, doesn't die destitute in a ditch somewhere?
The only answer people seem to have for that is "Charity". But honestly if there was a Charity that was large enough and distributed enough to do what the government does with social security then how exactly would it not have the same logistical and financial issues and need for everyone to contribute?
The sewer maintenance worker and everyone else benefits when the SSI dollars collected are permitted to be invested responsibly. A minimum benefit level can still be established for those that fall short, but having money that gathers dust and doesn’t grow is extremely irresponsible and wasteful and benefits no one.
If the SSI funds were allowed to be invested individually and the sewer worker’s lifetime contributions and growth did not reach a minimum benefit threshold (I think the max right now is around$2,600), I’m all for the government bridging that gap so the guy still gets his $2,600 per month. Meanwhile, if I had been able to invest my own SSI contributions in the same funds as my 401k all of these years, I would be able to at least double my benefit when I retire. This is not to “buy a boat”, this is to achieve an income and lifestyle that is ballpark what I live on today, which I don’t think is unreasonable after working hard my entire adult life.
So your assumption is that the government does not invest or utilize SS funds or that they invest them in a sub-optimal way? Can you back that up with something showing where SS funds are going or are you just assuming that?
No assumptions. (This is data you could have looked up independent of me).
This chart is the interest earned by the OASDI (SS trust fund) - care to put your own funds into this? Meanwhile, the stock market is making record gains.
Given the nature of the fund, I'd expect the objective to be primarily stability - near-maximum risk reduction. There is no risk-free rate of return, but the 3-month T-bill rate is sometimes used as the closest actual proxy. Just by eyeballing a few points, the OASDI return appears generally to track slightly above the 3-month T-bill historic rates. ( Wonder why that is - LOL!)Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »Aaron_K123 wrote: »Bry_Fitness70 wrote: »tbright1965 wrote: »MeanderingMammal wrote: »tbright1965 wrote: »
No, my point is contrary to the post quoted, I found the 401(k) to be superior to Social Security and that there was not incentive for the military to lower costs. Even when contracted out, unless the branch spending the money has an incentive to spend less, they will spend every dollar allocated, even if the goods or services are not needed.MeanderingMammal wrote: »tbright1965 wrote: »When I was in the military, people are rated based on the size of their kingdom. If an organization had money left over at the end of the fiscal year, they didn't return it for others to use. They spent it so they would get as much if not more the next fiscal year.
I'm not entirely clear on your point here. Are you suggesting that the delivery of military effect is something that should be provided by the private sector?
So the issue isn't with the delivery of military effect being a government function?
I'd agree that the behaviours that incremental budgeting encourages are unhelpful, but that's an issue with the budgeting technique rather than public services.
Zero based budgeting encourages its own bad behaviours, although in truth I think it's a more comprehensive approach to it.
The issue is blind belief that either government or private sector is the best.
Why not give people the choice? I.E. if one believes Social Security is better than a 401(k) let them VOLUNTARILY put their money in Social Security and live with the outcome. If others believe a 401(k) is the better option, instead of making them be part of Social Security (all or just the income security portion of FICA taxes) let them choose. Maybe they choose 0-100% of the 6.2% portion of their FICA taxes to go into SS and a similar choice for the employer's matching 6.2% "contribution."
But just passing a law saying you must be part of this great plan we've developed may not be the best for all involved.
I know I could be retired in my mid-50s had I had control of the 12.4% taken each year and immediately spent instead of modestly invested in index funds.
That's a high-tech job that could be filled by another instead of me, if I had control over those funds.
Instead, I'm forced into SS where not only must I contribute, but I'll only see 30% of my indexed monthly income s a benefit vs the worker who paid closer to the minimum who will get 90% of his indexed monthly income at full retirement age.
It's a bad deal all the way around for me.
The basic point I am making is that, in a complex, modern society of 330 million people, it doesn’t always get to be about you. (Or me, or any single individual for that matter). The design of something like SSI and the issues involved are a lot more complex than just saying “I want my 12.4%, because I want it”. (And what makes you think for even an instant that the company you work for would be willing to turn over that 6.2% if they weren’t “forced” to by the government? They would be crying “freedom” more quickly, more loudly, and more effectively than you).
And, as recent years have shown, there is no guarantee that you could invest your money that successfully, or that other factors over which you have no control wouldn’t intervene. Then the rest of society would have to pitch in and support you. A society has to take the long view of what is the best fit for everyone. I understand your point, but I think you are making the common mistake of seeing things only from the point of view of your narrow self-interest (not meant as criticism). The track record of the “voluntary” system you favor overall is not encouraging. We are going to be facing a crisis in the future because the vast majority of people in 401K plans have done a pretty poor job of investing—partly because they haven’t been able to invest much, partly because they aren’t very good at investing, and partly because their earnings are sharply reduced by fees that are charged (401K plans are in large part government-sponsored welfare programs for banks).
Obviously, you think you are the outlier. And you very well could be. And so from your perspective, it seems unfair that you are “forced” into a system that you think puts you at a disadvantage. And that could very well be true. My feeling is that society cannot risk having millions of elderly, impoverished citizens, just so that a special few (like you and me) can do better. IMO, that might suck, but that’s the price you pay for living in a modern nation with all the benefits that America has to offer. Overall, it’s not such a bad deal.
I didn’t read all of it, but this site seemed to be a honest attempt to lay out the pros and cons:
https://socialsecurity.procon.org/
The problem with SSI is 1) if I could have taken that 12.4% and invested it myself in the same portfolio as my 401k I would have a very good return and benefits far exceeding what I will draw from SSI some day. 2) I can start withdrawing from my 401k at 59.5 years old, while I have to wait until I'm 67 to get my full SSI benefit. So by being locked into a non-customizable SSI program, I get less money and I get it later.
I get that many people do not want to invest their own SSI - for those, they can opt for the old system and have a static benefit available. For the rest of us - it is our benefit that we are paying into, so let us have some control over it.
Again....SS doesn't exist for you or me or people who have enough money and work in a professional career to invest in a matched 401k. It isn't there so that I can retire and get a boat instead of not being able to get a boat. Yeah our ROI putting into SS isn't as good as putting into a 401k. That is because all we put into a 401k goes to us...not all we put into SS goes to us, some of it goes to other people who need it....like truly need it.
If you and I pay into SS then SS has enough funds to take care of the sewer maintenance worker who worked every day of their life until 60 when their knees were failing and they could work no more but still lived to the age of 85. To make sure they had at least enough for a plate of rice and beans and a roof over there head.
If you and I instead took that money and put it into a 401k that 401k isn't going to be giving anything to that sewer maintenance worker at all...we are just going to be able to afford that boat. So what system is in place to make sure that person, who worked dutifully and provided a service that we all benefit from, doesn't die destitute in a ditch somewhere?
The only answer people seem to have for that is "Charity". But honestly if there was a Charity that was large enough and distributed enough to do what the government does with social security then how exactly would it not have the same logistical and financial issues and need for everyone to contribute?
The sewer maintenance worker and everyone else benefits when the SSI dollars collected are permitted to be invested responsibly. A minimum benefit level can still be established for those that fall short, but having money that gathers dust and doesn’t grow is extremely irresponsible and wasteful and benefits no one.
If the SSI funds were allowed to be invested individually and the sewer worker’s lifetime contributions and growth did not reach a minimum benefit threshold (I think the max right now is around$2,600), I’m all for the government bridging that gap so the guy still gets his $2,600 per month. Meanwhile, if I had been able to invest my own SSI contributions in the same funds as my 401k all of these years, I would be able to at least double my benefit when I retire. This is not to “buy a boat”, this is to achieve an income and lifestyle that is ballpark what I live on today, which I don’t think is unreasonable after working hard my entire adult life.
So your assumption is that the government does not invest or utilize SS funds or that they invest them in a sub-optimal way? Can you back that up with something showing where SS funds are going or are you just assuming that?
No assumptions. (This is data you could have looked up independent of me).
This chart is the interest earned by the OASDI (SS trust fund) - care to put your own funds into this? Meanwhile, the stock market is making record gains.
You are comparing a 401k when you are still working to social security which is paying out to people as we speak. A 401k you put money into, you don't touch it until retirement. It makes sense to put money into a more volatile stock-heavy fund when you are younger and then transition that into a more secure bond-based fund when you are older and getting closer to pulling money out. When it is stock heavy the returns (and the loses) are larger. By the time you are pulling money out that 401k would be invested into a fund that does not "boom" when the stock market booms because it would be in bonds. The real comparison would be between social security funds and 401k funds that are paying out. The fact that social security has an interest return means that it is being invested, not "sitting on a shelf collecting dust". So, what is the interest a typical 401k returns when you are 65 and recieving payouts?
Social security is constantly in a state of paying out...maybe not to you personally right now, but to millions of people. It is therefore wise to have that money invested into a stable fund much like your 401k will be when you are retiring. If the government put that money into stocks and the market crashed then sewer worker wouldn't be getting his check anymore.
Again, if you agree that the sewer worker should have a minimum retirement benefit paid out by the government and obviously the government gets its money through taxes what exactly should we call that tax if it isn't called social security and how would that tax be any different that what social security tax currently is which is an income based tax put into bond style funds to payout to people who are at retirement age?
To answer your question for myself personally and for my own money I would put my money into a 401k that invests in stocks because I am 39 years old. If I agreed we should have funding to keep people in poverty able to eat and have housing after retirement and that I should contribute to that then I would want to put that contribution into a stable bond-style fund so that it was stable and can be used day to day to make payouts to people who are currently retired.
Yes, the OASDI does pay out funds, but that has nothing to do with the rate of return realized, that effects the absolute earnings in dollars.
I'm not saying that we should be able to invest our SS withholdings into something volatile and risky like Bitcoin, but there are safe index funds (similar to what federal government employees use for their 401k) that run circles around what the OASDI fund earns.
"Safe Index Fund" is an oxymoron. Some are safer than others (underlying investments in stable companies, well-diversified, etc.). They're still built on market investments, and they still have risk of various types. (Yes, I know some mutual funds trade in things other than market investments. Those are less common types . . . and they're commonly riskier, not less risky, than those built on market investments.)
Safe is a relative term. Any time you invest money there is an element of risk involved. In the context of investing, there are index funds that are much lower risk than playing the market and buying and selling individual stocks, so comparatively, they are safe.1 -
There is more than one sort of risk.
Not losing your principle, but failing to keep up with inflation is a form of risk.
If the money is going out at a fast enough rate, you have to do more than just keep pace with inflation, you must drastically beat it to keep paying benefits.
If the number of those contributing keeps dropping, as we see happening with labor participation rates, you face even more than just inflation risk here.
But the bottom line is the first point, inflation is also a risk, which means even losing ZERO of your principle can put one in a risky position.2 -
tbright1965 wrote: »There is more than one sort of risk.
Not losing your principle, but failing to keep up with inflation is a form of risk.
If the money is going out at a fast enough rate, you have to do more than just keep pace with inflation, you must drastically beat it to keep paying benefits.
If the number of those contributing keeps dropping, as we see happening with labor participation rates, you face even more than just inflation risk here.
But the bottom line is the first point, inflation is also a risk, which means even losing ZERO of your principle can put one in a risky position.
Oh I mean I'd agree that SS as it current is implemented is at definate risk of faliure. That is just the nature of birth rates declining, people having children at older and older ages and the increase in life expectancy. Essentially fewer and fewer people making money to support an larger and larger retired population.
I think there are problems with the system, I just don't consider burning it to the ground to be a solution.6 -
Aaron_K123 wrote: »tbright1965 wrote: »There is more than one sort of risk.
Not losing your principle, but failing to keep up with inflation is a form of risk.
If the money is going out at a fast enough rate, you have to do more than just keep pace with inflation, you must drastically beat it to keep paying benefits.
If the number of those contributing keeps dropping, as we see happening with labor participation rates, you face even more than just inflation risk here.
But the bottom line is the first point, inflation is also a risk, which means even losing ZERO of your principle can put one in a risky position.
Oh I mean I'd agree that SS as it current is implemented is at definate risk of faliure. That is just the nature of birth rates declining, people having children at older and older ages and the increase in life expectancy. Essentially fewer and fewer people making money to support an larger and larger retired population.
I think there are problems with the system, I just don't consider burning it to the ground to be a solution.
I'm not either. I'm just saying give people the freedom to choose the system or not.
If there isn't a captive set of taxpayers funding it, but it has to compete with the lure of NOT being in the system, there is great incentive to fix it so it is appealing on the merits of participating.
So don't burn it down. But don't lock everyone into it. Let people choose.6 -
Efficiency and Economy. A best practice implemented at universities across North America is to require all students to buy a bus pass. There was some protest by students here in town who never intended to use their pass but it went through anyways.
Collectively the pass was deeply discounted. Transit ridership went up. Less use of vehicles/parking, and fewer emissions.
An enforced collectivism resulted in savings overall and an incentive to use a formerly underutilized service.
Social Security could not work based on an opt-in system.4 -
Aaron_K123 wrote: »tbright1965 wrote: »There is more than one sort of risk.
Not losing your principle, but failing to keep up with inflation is a form of risk.
If the money is going out at a fast enough rate, you have to do more than just keep pace with inflation, you must drastically beat it to keep paying benefits.
If the number of those contributing keeps dropping, as we see happening with labor participation rates, you face even more than just inflation risk here.
But the bottom line is the first point, inflation is also a risk, which means even losing ZERO of your principle can put one in a risky position.
Oh I mean I'd agree that SS as it current is implemented is at definate risk of faliure. That is just the nature of birth rates, people having children at older and older ages and the increase in life expectancy. Essentially fewer and fewer people making money to support an larger and larger retired population.
I think there are problems with the system, I just don't consider burning it to the ground to be a solution.
But there are two different topics in play here: Investment risk (which is related to investment return), sort of an investment technical term - whether OASDI is doing the right thing with "investing" those tax dollars; and the risk that the SS system will fail, which is using the term "risk" in the normal conversational sense.
OASDI is probably going for what would be classically considered low-risk investment strategies (to the extent you can say the money is invested in any normal sense); this "low risk" investment strategy could arguably help to increase its risk of system failure (because of inflation, in a context of breakdown of the historic assumption of population growth, life expectancy, etc.)
Regular humans sometimes fail at retirement investment by selecting investments that are too "low risk" - T-bills, CDs, money markets, etc. Fear of investment risk tends to limit investment return, historically, and leave one subject to inflation risk (a different technical term ). But "past performance is no guarantee of future results", as the prospectuses warn. 0 -
Efficiency and Economy. A best practice implemented at universities across North America is to require all students to buy a bus pass. There was some protest by students here in town who never intended to use their pass but it went through anyways.
Collectively the pass was deeply discounted. Transit ridership went up. Less use of vehicles/parking, and fewer emissions.
An enforced collectivism resulted in savings overall and an incentive to use a formerly underutilized service.
Social Security could not work based on an opt-in system.
If Social Security could not work based on an opt-in system, that indicates there is a major flaw in its structure. If something must be forced, then what is wrong with it that people would not freely choose it?
If you have to force someone to participate, then ask yourself what is so broken that it doesn't stand on the merits?8 -
tbright1965 wrote: »Efficiency and Economy. A best practice implemented at universities across North America is to require all students to buy a bus pass. There was some protest by students here in town who never intended to use their pass but it went through anyways.
Collectively the pass was deeply discounted. Transit ridership went up. Less use of vehicles/parking, and fewer emissions.
An enforced collectivism resulted in savings overall and an incentive to use a formerly underutilized service.
Social Security could not work based on an opt-in system.
If Social Security could not work based on an opt-in system, that indicates there is a major flaw in its structure. If something must be forced, then what is wrong with it that people would not freely choose it?
If you have to force someone to participate, then ask yourself what is so broken that it doesn't stand on the merits?tbright1965 wrote: »Efficiency and Economy. A best practice implemented at universities across North America is to require all students to buy a bus pass. There was some protest by students here in town who never intended to use their pass but it went through anyways.
Collectively the pass was deeply discounted. Transit ridership went up. Less use of vehicles/parking, and fewer emissions.
An enforced collectivism resulted in savings overall and an incentive to use a formerly underutilized service.
Social Security could not work based on an opt-in system.
If Social Security could not work based on an opt-in system, that indicates there is a major flaw in its structure. If something must be forced, then what is wrong with it that people would not freely choose it?
If you have to force someone to participate, then ask yourself what is so broken that it doesn't stand on the merits?
By that rationale, all taxes should be voluntary.
Also car insurance, drivers licenses, etc
6 -
tbright1965 wrote: »Efficiency and Economy. A best practice implemented at universities across North America is to require all students to buy a bus pass. There was some protest by students here in town who never intended to use their pass but it went through anyways.
Collectively the pass was deeply discounted. Transit ridership went up. Less use of vehicles/parking, and fewer emissions.
An enforced collectivism resulted in savings overall and an incentive to use a formerly underutilized service.
Social Security could not work based on an opt-in system.
If Social Security could not work based on an opt-in system, that indicates there is a major flaw in its structure. If something must be forced, then what is wrong with it that people would not freely choose it?
If you have to force someone to participate, then ask yourself what is so broken that it doesn't stand on the merits?
So why do we need police to enforce the law? Is that an indication that law is flawed?8 -
The electrical grid is a collective system that is only economical if everyone opts in. Just because it is communal does not make it flawed.
The same with sewer systems and freeways.7 -
And education.1
-
I do think the overall education quality has gone down in North America with the allowance of charter schools. That abusive couple in California (13 children!) escaped detection for decades. The dad registered his home as a charter school.
Not that rigid, uniform education is always best. Both my husband and I (at different ends of the IQ spectrum) suffered under the public school system. Neither of us fit the average.6 -
Aaron_K123 wrote: »tbright1965 wrote: »Efficiency and Economy. A best practice implemented at universities across North America is to require all students to buy a bus pass. There was some protest by students here in town who never intended to use their pass but it went through anyways.
Collectively the pass was deeply discounted. Transit ridership went up. Less use of vehicles/parking, and fewer emissions.
An enforced collectivism resulted in savings overall and an incentive to use a formerly underutilized service.
Social Security could not work based on an opt-in system.
If Social Security could not work based on an opt-in system, that indicates there is a major flaw in its structure. If something must be forced, then what is wrong with it that people would not freely choose it?
If you have to force someone to participate, then ask yourself what is so broken that it doesn't stand on the merits?
So why do we need police to enforce the law? Is that an indication that law is flawed?
No, you simply enforce the consequences.
The flaw isn't with the law, it's with those who choose to break it.
The way I view SS, it's little different from those who would break the law by robbing others.
We don't lock up the victims for what the criminals do. So why do we "lock up" taxpayers in a system that doesn't benefit them?
Social Security is the equivalent of locking up the victims of a robbery.8 -
johnslater461 wrote: »tbright1965 wrote: »Efficiency and Economy. A best practice implemented at universities across North America is to require all students to buy a bus pass. There was some protest by students here in town who never intended to use their pass but it went through anyways.
Collectively the pass was deeply discounted. Transit ridership went up. Less use of vehicles/parking, and fewer emissions.
An enforced collectivism resulted in savings overall and an incentive to use a formerly underutilized service.
Social Security could not work based on an opt-in system.
If Social Security could not work based on an opt-in system, that indicates there is a major flaw in its structure. If something must be forced, then what is wrong with it that people would not freely choose it?
If you have to force someone to participate, then ask yourself what is so broken that it doesn't stand on the merits?tbright1965 wrote: »Efficiency and Economy. A best practice implemented at universities across North America is to require all students to buy a bus pass. There was some protest by students here in town who never intended to use their pass but it went through anyways.
Collectively the pass was deeply discounted. Transit ridership went up. Less use of vehicles/parking, and fewer emissions.
An enforced collectivism resulted in savings overall and an incentive to use a formerly underutilized service.
Social Security could not work based on an opt-in system.
If Social Security could not work based on an opt-in system, that indicates there is a major flaw in its structure. If something must be forced, then what is wrong with it that people would not freely choose it?
If you have to force someone to participate, then ask yourself what is so broken that it doesn't stand on the merits?
By that rationale, all taxes should be voluntary.
Also car insurance, drivers licenses, etc
You are doing an apples to oranges comparison. In no way did I say I was against public works projects such as building roads, bridges, etc.
I can be in favor of that and be against the institutional theft known as Social Security.8 -
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tbright1965 wrote: »johnslater461 wrote: »tbright1965 wrote: »Efficiency and Economy. A best practice implemented at universities across North America is to require all students to buy a bus pass. There was some protest by students here in town who never intended to use their pass but it went through anyways.
Collectively the pass was deeply discounted. Transit ridership went up. Less use of vehicles/parking, and fewer emissions.
An enforced collectivism resulted in savings overall and an incentive to use a formerly underutilized service.
Social Security could not work based on an opt-in system.
If Social Security could not work based on an opt-in system, that indicates there is a major flaw in its structure. If something must be forced, then what is wrong with it that people would not freely choose it?
If you have to force someone to participate, then ask yourself what is so broken that it doesn't stand on the merits?tbright1965 wrote: »Efficiency and Economy. A best practice implemented at universities across North America is to require all students to buy a bus pass. There was some protest by students here in town who never intended to use their pass but it went through anyways.
Collectively the pass was deeply discounted. Transit ridership went up. Less use of vehicles/parking, and fewer emissions.
An enforced collectivism resulted in savings overall and an incentive to use a formerly underutilized service.
Social Security could not work based on an opt-in system.
If Social Security could not work based on an opt-in system, that indicates there is a major flaw in its structure. If something must be forced, then what is wrong with it that people would not freely choose it?
If you have to force someone to participate, then ask yourself what is so broken that it doesn't stand on the merits?
By that rationale, all taxes should be voluntary.
Also car insurance, drivers licenses, etc
You are doing an apples to oranges comparison. In no way did I say I was against public works projects such as building roads, bridges, etc.
I can be in favor of that and be against the institutional theft known as Social Security.
There are people who consider things like public roads (and things such as public schools) to be institutional theft as well. What argument would you make that we need roads in a way that entitles the government to use force (if necessary) to take money for them that wouldn't apply to a public good like, say, ensuring that children have food or learn to read?4 -
janejellyroll wrote: »
There are people who consider things like public roads (and things such as public schools) to be institutional theft as well. What argument would you make that we need roads in a way that entitles the government to use force (if necessary) to take money for them that wouldn't apply to a public good like, say, ensuring that children have food or learn to read?
Why should government use force to build the roads?
Tax motor fuels (we do) and use those taxes only for building and maintaining the roads. If you drive more miles, or carry heavier loads, you'll use more fuel and pay more taxes.
Those using the roads the most pay the most. Those using the roads the least, either by fewer miles or lighter vehicles that do less damage, pay less.
If you want public transit, build the rails like you would the roads, and pay for the vehicles (buses and trains) and the staff the same way commuters pay for their cars, by charging enough to cover the costs of those aspects.
No special deals for large corporations, college students, seniors, or whomever. The infrastructure costs the same regardless your circumstance in life.
Ditto for things like the FAA (now we are at the federal level, most of the above can and is covered at the state and local level) pay for it with fees charged to users and airlines. Those who fly themselves or cargo are the ones paying for the necessary services. No need to tax grandma for an airport initiative. If she gets FedEx next day packages, the costs are baked into the price of the package shipping, not some special tax collection.
I say the same about local governments who want to use TIFs and public money to build a sports stadium or what not. If the stadium is such a great deal for the local economy, let the local business leaders and investors put up their treasure and reap the rewards for the project. No need for taxpayers to be placed on the hook for such a venture.
My view is that if you treat different people differently, such as taxing one group at a 10% marginal rate and another at 28% you are stealing from those who are asked to pay 3x as much. Likewise with Social Security, if you are giving one recipient 90% of his indexed income in retirement benefits, but only pay 15% on indexed wages earned by another, you are stealing from the person getting the 15% benefit.
Much like if you give one business a tax break, but not all of them, that too is theft from those not getting the break.4 -
tbright1965 wrote: »janejellyroll wrote: »
There are people who consider things like public roads (and things such as public schools) to be institutional theft as well. What argument would you make that we need roads in a way that entitles the government to use force (if necessary) to take money for them that wouldn't apply to a public good like, say, ensuring that children have food or learn to read?
Why should government use force to build the roads?
Tax motor fuels (we do) and use those taxes only for building and maintaining the roads. If you drive more miles, or carry heavier loads, you'll use more fuel and pay more taxes.
Those using the roads the most pay the most. Those using the roads the least, either by fewer miles or lighter vehicles that do less damage, pay less.
If you want public transit, build the rails like you would the roads, and pay for the vehicles (buses and trains) and the staff the same way commuters pay for their cars, by charging enough to cover the costs of those aspects.
No special deals for large corporations, college students, seniors, or whomever. The infrastructure costs the same regardless your circumstance in life.
Ditto for things like the FAA (now we are at the federal level, most of the above can and is covered at the state and local level) pay for it with fees charged to users and airlines. Those who fly themselves or cargo are the ones paying for the necessary services. No need to tax grandma for an airport initiative. If she gets FedEx next day packages, the costs are baked into the price of the package shipping, not some special tax collection.
I say the same about local governments who want to use TIFs and public money to build a sports stadium or what not. If the stadium is such a great deal for the local economy, let the local business leaders and investors put up their treasure and reap the rewards for the project. No need for taxpayers to be placed on the hook for such a venture.
My view is that if you treat different people differently, such as taxing one group at a 10% marginal rate and another at 28% you are stealing from those who are asked to pay 3x as much. Likewise with Social Security, if you are giving one recipient 90% of his indexed income in retirement benefits, but only pay 15% on indexed wages earned by another, you are stealing from the person getting the 15% benefit.
Much like if you give one business a tax break, but not all of them, that too is theft from those not getting the break.
So you would eliminate income taxes and pay for everything with fees on specific purchases (like fuel taxes, airline taxes, etc)?
2 -
janejellyroll wrote: »So you would eliminate income taxes and pay for everything with fees on specific purchases (like fuel taxes, airline taxes, etc)?
I would eliminate the so-called progressive taxes. A nation founded in freedom is not making progress if it taxes different citizens at differing rates.
Our Federal government spends roughly 20% of GDP, so no dollar earned should face more than 20% in Federal taxes when both payroll and income taxes are considered.
So a worker paying 7.65% FICA taxes should never pay more than 12.35% income tax on those dollars earned.
Now, if we were really living my fantasy, we would not have the taxes deducted from our pay. Instead, you would have to pay your representative in Congress. After all, according to the Constitution, Congress has the power of the purse and makes the laws that result in both our taxation and spending. So instead of having the "painless" process of the IRS leaning on employers to pay up, those elected to Congress would be responsible for leaning on their constituents, collecting the money from them in a less automatic, more transparent way. Taxes would be paid little differently from paying rent, utilities, etc.
I suspect people would take a closer look at what their representatives in Congress were doing if they had to cut a check to their office every month.
But it will never happen. Politicians like to pit one group against another and they like to take money from one group and buy the votes of another.
Just look at the outcry during the last tax cuts. Some sold the notion that taxpayers would keep more of what they earned as stealing from other people.
How is keeping more of what you earn ever stealing from another? Yet we had politicians bleating such nonsense at a mere 3% cut in marginal rates.
5 -
tbright1965 wrote: »janejellyroll wrote: »So you would eliminate income taxes and pay for everything with fees on specific purchases (like fuel taxes, airline taxes, etc)?
I would eliminate the so-called progressive taxes. A nation founded in freedom is not making progress if it taxes different citizens at differing rates.
Our Federal government spends roughly 20% of GDP, so no dollar earned should face more than 20% in Federal taxes when both payroll and income taxes are considered.
So a worker paying 7.65% FICA taxes should never pay more than 12.35% income tax on those dollars earned.
Now, if we were really living my fantasy, we would not have the taxes deducted from our pay. Instead, you would have to pay your representative in Congress. After all, according to the Constitution, Congress has the power of the purse and makes the laws that result in both our taxation and spending. So instead of having the "painless" process of the IRS leaning on employers to pay up, those elected to Congress would be responsible for leaning on their constituents, collecting the money from them in a less automatic, more transparent way. Taxes would be paid little differently from paying rent, utilities, etc.
I suspect people would take a closer look at what their representatives in Congress were doing if they had to cut a check to their office every month.
But it will never happen. Politicians like to pit one group against another and they like to take money from one group and buy the votes of another.
Just look at the outcry during the last tax cuts. Some sold the notion that taxpayers would keep more of what they earned as stealing from other people.
How is keeping more of what you earn ever stealing from another? Yet we had politicians bleating such nonsense at a mere 3% cut in marginal rates.
So taxes on income would still be collected, the force of law would still be behind them even if one was writing a check to a congressional representative rather than the Department of the Treasury, correct?
So if I considered those "institutional theft," what would you tell me?
(Do you think it might be possible to have this conversation without using terms like "bleating nonsense" to characterize the statements of those who hold different opinions? If not, that's fine, I just find it's not that conducive to serious discussion).
4 -
janejellyroll wrote: »
So taxes on income would still be collected, the force of law would still be behind them even if one was writing a check to a congressional representative rather than the Department of the Treasury, correct?
So if I considered those "institutional theft," what would you tell me?
I thought I said this already, my view of the institutional theft is the different treatment. So if you are paying a marginal rate of 10% and I'm paying 28% marginal rates, the nearly 3x taxation on my marginal dollar is what I consider theft.
If we are both paying 10% we may have a debate about if its being used well, but I'm paying the same fair share as you, 1 out of every 10 dollars earned.
Ditto for the Social Security program. I believe I posted a link to the benefits formula. So the person getting 90% of his indexed income wasn't robbed. But those who reach the bend points of 32% and 15% benefits, but had to pay the same 6.2% FICA taxes plus either another 6.2% funded by self or the employer depending on how they earned their income, that person is being robbed when every dollar of indexed income does not result in the same 90% benefit.
That's the institutional robbery, treating one person differently than the other.
All should pay the same rate and get the same return. Do it differently and you have to rob one to pay the other a greater portion.3
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