Pretending Social Security is an annuity and calculating a base for it???

[Tahoe Ray]

Social Security works more like a Ponzi scheme.

I agree.

 

[Deborah Armstrong]

Troll.

Let me explain why I said it is more like a Ponzi Scheme.

Charles Ponzi used new investors' money to pay older investors. Younger workers paying Social Security tax known as FICA is used to pay recipients of Social Security.

The boomer generation outnumbers other generations. We are in a conundrum and social security is at risk. Younger generations are concerned that they will not see Social Security benefits by the time they retire and they are paying into a system they may not ever receive.

Social Security is set to run out by 2035. How would you feel if you invested in a system that promised to pay you when you retire and you never received anything from that investment? That is what Charles Ponzi promised and that is what Social Security promised.

 

[LostDollar]

https://www.ncpssm.org/documents/so...papers/social-security-is-not-a-ponzi-scheme/

There is no credible comparison between Social Security and a Ponzi scheme. Social Security has fulfilled its promise to workers since the first benefits were paid in January 1940. With the support of the American people, the President and the Congress, there is no reason to believe that Social Security will not keep its promise to future generations and continue to pay benefits for years to come.

 

[adjusterjack]

Social Security is set to run out by 2035. How would you feel if you invested in a system that promised to pay you when you retire and you never received anything from that investment? That is what Charles Ponzi promised and that is what Social Security promised.

One is either a fool or a troll to make that kind of statement.

The fallacy in your argument is that the government will eventually inject funds into Social Security to fulfill that promise, just like it pumps money into everything else when there is a crisis.

 

[tikibarrister]

Social Security is set to run out by 2035.

For at least the last 50 years, Social Security has always been "set to run out in 20 years".

I know because that's as far back as I can remember hearing that.

 

[Tahoe Ray]

Benefit age should be drastically increased.

The can can only be kicked down the road for so long and unfortunately the people making these decisions aren't going to even be around to see the consequences.

 

[rmhaire]

the government will eventually inject funds into Social Security to fulfill that promise

They'll either steal more or print more. SS ain't going nowhere.

For at least the last 50 years, Social Security has always been "set to run out in 20 years".

Me too. At least 50 and maybe more.

The can can only be kicked down the road

When that happens they'll just go out and get a new can.

Younger generations are concerned that they will not see Social Security benefits by the time they retire

Then you need to speed it up and catch up to us old farts. Your money is right here waiting for you.

 

[PrivClientSG]

Let me explain why I said it is more like a Ponzi Scheme.

Charles Ponzi used new investors' money to pay older investors. Younger workers paying Social Security tax known as FICA is used to pay recipients of Social Security.

The boomer generation outnumbers other generations. We are in a conundrum and social security is at risk. Younger generations are concerned that they will not see Social Security benefits by the time they retire and they are paying into a system they may not ever receive.

Social Security is set to run out by 2035. How would you feel if you invested in a system that promised to pay you when you retire and you never received anything from that investment? That is what Charles Ponzi promised and that is what Social Security promised.

First, I promised myself I wouldn't respond to such foolishness, but I decided to break my promise to myself. Second, the people who sell fear and panic in and around Social Security are either fools, uninformed, or simply using fear and panic to further or solidify some self-serving position. Third, Social Security is not set to "run out" by 2035 -- the current allocation funding will be unfunded by 2035, if and only if the Government went to sleep, made no changes between now and 2035, and never added another dollar to the current funding allocation. Fourth, Social Security has not "promised" what Charles Ponzi proved. The United States Government and Social Security have not claimed they will not pay people. Not at all. Thank you.

 

[PrivClientSG]

For at least the last 50 years, Social Security has always been "set to run out in 20 years".

I know because that's as far back as I can remember hearing that.

That's true. It's been a "rolling" approximate 20 years since the early to mid 70's.

 

[PrivClientSG]

(Caveat, not an agent.)

For retirement asset allocation purposes:

If one wanted to pretend Social Security is an annuity and make some lifespan assumptions:

How would they compute a $ basis for the annuity payment in order to do asset allocation %'s with other retirement assets?

Thank you.

For me, I would not count it as "an asset" or as a "capital pool" -- as there is no lump sum accessibility, and it "disappears" at death (so to speak, excluding a spousal step up or continuation). As an annuity, vis a vis the income -- I would certainly count it -- and I would count it as a "guaranteed" income. If need be, I would say it's origin is a "fixed income" source and attach the percentage of income to it, however, I wouldn't allow that to give me permission to alter my asset allocation, simply because I had this "fixed income" asset class. You don't. You have an income stream -- not an asset class.

The taxability is going to be case by case.