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From: amdx on 15 Jun 2010 07:13 >> Liberals will say" but they pay payroll taxes, these are > >> social security and medicare. First SS is a retirement/disability > >> program that they will most likely get more dollars back than they > >> ever pay in, and Medicare is a medical insurance program > >> while they will be collecting during retirement/disability. > >> This has nothing to do with federal income taxes. >Yes, but if they paid in say $50,000 over 40 years, the investment >would double every 10 years at a 7% return. So, figuring the average >amount of $25,000 doubling every 10 years for 40 years you get >$400,000 and maybe 15k benefit which is less than a 5% return. Should >last forever. >So, you probably won't get back what you paid in, unless you paid very >little in, in which case you win the game. -Bill That's a great arguement for allowing individuals to invest there own SS funds. Over the long term the stock market has returned well over 7%. I'm pretty sure the government didn't get 7%, since the system is broke. Your math is not right either, it would take me to long to hone on on it but a financial guy could do quickly. One of the errors has to do with the average ($25,000) The first 20 years you don't have much money in the fund earning interest. Upon further inspection, what I said about collecting multiples of what you paid into the system would certainly apply to me, especially if I were collecting now. It will be about 12 years before I can collect, I suspect there will be great changes in SS by then. I predict lower benefits and higher SS premiums. Also in the mix to fix the SS system, further increases of the retirement age, increases in the cap (now $106,000) and means testing for benefit calculations. And now some real world numbers, straight off my 2009 SS statement. In a strange coincidence, I have a 40 payment history. In those 40 years, my total paid into the SS system, drum roll please, $72,311 dollars. I'm sure others have paid much more. If I get the urge, I'll go back and find the percentage of SS for each of those years and then be able to do a better analyses. When I started paying the rate was 4.2%, now it is up to 6.2%. All very interesting :-) Mike
From: dagmargoodboat on 15 Jun 2010 09:54 On Jun 14, 11:48 pm, Bill Bowden <wrongaddr...(a)att.net> wrote: > On Jun 14, 7:51 pm, "amdx" <a...(a)knology.net> wrote: > > > Liberals will say "but they pay payroll taxes," these are > > social security and medicare. First SS is a retirement/disability > > program that they will most likely get more dollars back than they > > ever pay in, and Medicare is a medical insurance program > > while they will be collecting during retirement/disability. > > > This has nothing to do with federal income taxes. > > Yes, but if they paid in say $50,000 over 40 years, the investment > would double every 10 years at a 7% return. So, figuring the average > amount of $25,000 doubling every 10 years for 40 years you get > $400,000 and maybe 15k benefit which is less than a 5% return. Should > last forever. > > So, you probably won't get back what you paid in, unless you paid very > little in, in which case you win the game. > > -Bill Except that no one saves and invests your money, so those returns don't apply. It's not a savings plan when you send your money to the world's ultimate spendthrift. Uncle Sam sends it out the door to someone else the moment you send it in. So, there are no investment gains. An easy double-check is this--where is that big pile of people's accumulated contributions? It's with Santa Claus and the Easter Bunny--it never existed. It's gone. So, you're not getting your money back. You might get someone else's money, if you can elect a government to take it for you. It puzzles me that Washington's Gang of Three constantly points to Social Security as a giant accomplishment. It's a disaster, the world's 2nd biggest Ponzi scheme & largest unfunded pension plan. Fortunately, unlike real pension plans, the government can just change the terms and benefits of the plan whenever it wants. All this nuisance can be cured by simply raising the retirement age to 97. -- Cheers, James Arthur
From: amdx on 15 Jun 2010 10:02 <dagmargoodboat(a)yahoo.com> wrote in message news:a64fe0e4-b746-4e14-8b0d-c70da10cbe05(a)r27g2000yqb.googlegroups.com... On Jun 14, 11:48 pm, Bill Bowden <wrongaddr...(a)att.net> wrote: > On Jun 14, 7:51 pm, "amdx" <a...(a)knology.net> wrote: > > > Liberals will say "but they pay payroll taxes," these are > > social security and medicare. First SS is a retirement/disability > > program that they will most likely get more dollars back than they > > ever pay in, and Medicare is a medical insurance program > > while they will be collecting during retirement/disability. > > > This has nothing to do with federal income taxes. > > Yes, but if they paid in say $50,000 over 40 years, the investment > would double every 10 years at a 7% return. So, figuring the average > amount of $25,000 doubling every 10 years for 40 years you get > $400,000 and maybe 15k benefit which is less than a 5% return. Should > last forever. > > So, you probably won't get back what you paid in, unless you paid very > little in, in which case you win the game. > > -Bill Except that no one saves and invests your money, so those returns don't apply. It's not a savings plan when you send your money to the world's ultimate spendthrift. Uncle Sam sends it out the door to someone else the moment you send it in. So, there are no investment gains. An easy double-check is this--where is that big pile of people's accumulated contributions? It's with Santa Claus and the Easter Bunny--it never existed. It's gone. So, you're not getting your money back. You might get someone else's money, if you can elect a government to take it for you. It puzzles me that Washington's Gang of Three constantly points to Social Security as a giant accomplishment. It's a disaster, the world's 2nd biggest Ponzi scheme & largest unfunded pension plan. Fortunately, unlike real pension plans, the government can just change the terms and benefits of the plan whenever it wants. All this nuisance can be cured by simply raising the retirement age to 97. -- Cheers, James Arthur Ya , what James said! Mike
From: amdx on 15 Jun 2010 10:28 > And now some real world numbers, straight off my 2009 SS statement. > In a strange coincidence, I have a 40 payment history. > In those 40 years, my total paid into the SS system, drum roll please, > $72,311 dollars. I'm sure others have paid much more. > If I get the urge, I'll go back and find the percentage of SS for each of > those years and > then be able to do a better analyses. When I started paying the rate was > 4.2%, > now it is up to 6.2%. All very interesting :-) > Mike > I should have added, the SS administration has my benefit calculated at $1,623 per month, if I retire at 66 and 2 months. So... 12 x $1,623 = $19,476 payments received per year. $72,311 / $19,476 = 3.7 years. I will collect all the money I paid into SS in less than four years. If I live to be 81 yrs old I will collect 4 times more than I ever paid in. I know there is a thing called compound interest and it should be added into this equation, I'll do that as soon I find where they have put the interest earned on my deposits. Mike After figuring this I missed something. I still have 12 yrs of payments to add to my total deposits, so the picture is a little better than I have stated above. Also a man 55 years old today has a life expectancy of 77.2 yrs not 81, however these numbers were based on me and I think I'll make 81. If you become disabilled at an early age a person could collect 10 or 20 times what they paid in. Good for the individual, bad for the system.
From: Bill Bowden on 15 Jun 2010 20:10 On Jun 15, 6:54 am, dagmargoodb...(a)yahoo.com wrote: > On Jun 14, 11:48 pm, Bill Bowden <wrongaddr...(a)att.net> wrote: > > > > > On Jun 14, 7:51 pm, "amdx" <a...(a)knology.net> wrote: > > > > Liberals will say "but they pay payroll taxes," these are > > > social security and medicare. First SS is a retirement/disability > > > program that they will most likely get more dollars back than they > > > ever pay in, and Medicare is a medical insurance program > > > while they will be collecting during retirement/disability. > > > > This has nothing to do with federal income taxes. > > > Yes, but if they paid in say $50,000 over 40 years, the investment > > would double every 10 years at a 7% return. So, figuring the average > > amount of $25,000 doubling every 10 years for 40 years you get > > $400,000 and maybe 15k benefit which is less than a 5% return. Should > > last forever. > > > So, you probably won't get back what you paid in, unless you paid very > > little in, in which case you win the game. > > > -Bill > > Except that no one saves and invests your money, so those returns > don't apply. It's not a savings plan when you send your money to the > world's ultimate spendthrift. Uncle Sam sends it out the door to > someone else the moment you send it in. > > So, there are no investment gains. > > An easy double-check is this--where is that big pile of people's > accumulated contributions? It's with Santa Claus and the Easter > Bunny--it never existed. It's gone. So, you're not getting your > money back. You might get someone else's money, if you can elect a > government to take it for you. > > It puzzles me that Washington's Gang of Three constantly points to > Social Security as a giant accomplishment. It's a disaster, the > world's 2nd biggest Ponzi scheme & largest unfunded pension plan. > > Fortunately, unlike real pension plans, the government can just change > the terms and benefits of the plan whenever it wants. > > All this nuisance can be cured by simply raising the retirement age to > 97. > > -- > Cheers, > James Arthur Actually, the income from payroll taxes is credited to the SS trust fund in the form of "special-issue" securities", which are like Treasury bonds and earn interest the same as Treasury notes. Reference: http://www.socialsecurity.gov/OACT/ProgData/fundFAQ.html#n2 "Far from being "worthless IOUs," the investments held by the trust funds are backed by the full faith and credit of the U. S. Government. The government has always repaid Social Security, with interest. The special-issue securities are, therefore, just as safe as U.S. Savings Bonds or other financial instruments of the Federal government. " The only question is, when the SS fund runs out of money, who will get paid first? the Chinese holding treasury bonds, or the SS trust fund holding special-issue securities? The Chinese don't vote, and all the retired people do. So, I would imagine when things get tough, the politicians will know who to pay first, if they want to stay in office. -Bill
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