Boomer Social Security Drain Begins

[Orville Wrong]

http://www.usatoday.com/news/washington/2007-10-08-boomers_N.htm?loc=interstitialskip

When Kathleen Casey-Kirschling signs up for Social Security benefits Monday, it will represent one small step for her, one giant leap for her baby boom generation — and a symbolic jump toward the retirement system's looming bankruptcy.

Casey-Kirschling — generally recognized as the nation's first boomer (born in Philadelphia on Jan. 1, 1946, at 12:00:01 a.m.) — won't bankrupt the Social Security system by taking early retirement at 62. But after her, the deluge: 80 million Americans born from 1946 to 1964 who could qualify for Social Security and Medicare during the next 22 years.

Love the chart with the "trust fund," glibly pretending there is one, rather than a stack of IOUs dating back to the Johnson administration.

[Slar]

http://winterlong.files.wordpress.com/2007/02/whirlpool.jpg

[ICONOCLAST420]

http://img292.imageshack.us/img292/6744/socialiststupidity6cj.jpg

I would gladly forfeit any claims to SS benefits in exchange for being able to opt out and keep my withholdings and invest it in a private retirement fund that won't be bankrupt in 2041.

[BigSugar]

soylent green anyone?? :)

[tobedawg]

The Social Security system is indeed in crisis.. The question now is though, what should be done to fix the problem? Should the system be privatized?

What angers me about the state of Social Security is that some folks that I have talked to receive SSI when they are perfectly capable of working and holding down a job, but because of some "obscure" illness or injury, they are entitled to a monthly check..

If you have paid into the system during your lifetime and are retiring and want benefits.. that's fine, if you are legitamitely disabled to where you cannot work (and I'm NOT talking a little spinal injury that WOULDN'T hinder one from doing a desk job) then fine, but Social Security as an alternative welfare plan for those that want to exploit it should be stopped and this also goes for members of Congress who can draw social security but also get nice cushy pensions, sponsored by us, The Taxpayers..

[noonan]

I'm just so glad she doesn't have to sell that boat to pay for food and healthcare.

[Measure Up!]

My off-the-top of my head three point plan to fix Social Security

1. Give incentives to boomers to work longer so that they contribute to SS rather than draw from it. Tax breaks, free viagra, whatever it takes.

2. Grandfather out the current system. Instead, have government insured savings plan. Have private banks bid to hold the deposits. Money can be transferred to others (spouses, partners, etc.) tax-free upon death. Treat account(s) as shared assets in divorce situations.

3. While grandfathering out old way, raise maximum income from which SS tax is paid.

[classicgrrl]

http://img292.imageshack.us/img292/6744/socialiststupidity6cj.jpg

I would gladly forfeit any claims to SS benefits in exchange for being able to opt out and keep my withholdings and invest it in a private retirement fund that won't be bankrupt in 2041.

precisely why I am fucking determined to get into government or university for a job. NO SS!

[The Sheck]

Makes me glad I work for the government, now.

[classicgrrl]

Makes me glad I work for the government, now.

I could have bought and paid off a house by now with the money that is stolen from my paycheck every two weeks.

and that is how it feels to me...stealing.

[Orville Wrong]

It should be privatized on a voluntary basis only into IRA accounts with special big tax penalties on early redemption by idiots to supply the public fund.

[classicgrrl]

It should be privatized on a voluntary basis only into IRA accounts with special big tax penalties on early redemption by idiots to supply the public fund.

this idiot needed a early redemption to recover from her divorce to be able to move out on her own.

:rolleyes:

[mishka77]

precisely why I am fucking determined to get into government or university for a job. NO SS!

Gov't workers now pay into SS as part of the "retirement" plan - there are now 3 parts, SS, a small percentage of your salary is saved from your check, and then there is a voluntary 401K-like part you can contribute to and move your money around and invest in different portfolios. Gov't retirement ain't what it used to be, which is part of the reason gov't can't attract new hires like it used to, either. They changed the rules for gov't workers in the 80's, when Congress decided the old retirement plan was too generous and gov't workers could help bail out SS by forcing them to pay into it too. It will be a very long time before I retire, since I expect they will raise the minimum retirement age before I am 62, which is the earliest I can hope to retire at this point.

[ICONOCLAST420]

The Social Security system is indeed in crisis.. The question now is though, what should be done to fix the problem? Should the system be privatized?
Absolutely 100%, everyone needs their own account with their name on it that can be part of their willable estate if they die with money left over. The "gimme generation" is receiveing the largest intergenerational wealth transfer in U.S. History and even expect their viagra for free. The senior citizens who have to choose between food and medicine are few and far between, the majority of senior citizens are the richest segment of the population who spend more eating out, playing slots in Las Vegas, or buying a new Buick every year than what they spend on medication.



What angers me about the state of Social Security is that some folks that I have talked to receive SSI when they are perfectly capable of working and holding down a job, but because of some "obscure" illness or injury, they are entitled to a monthly check.
I know a lot of people like this, their "obscure" illness just happens to be chronic lazyness.

[Marlowe]

my father worked for the gov'mint most of his career, so he only gets a tiny SS payment from when he worked pre-career and post-retirement from the military.

my mother died a few years ago, and due to some obscure provision in the tax code, her entire beneficiary benefit that is supposed to go to surviving spouse, was zero'd out. why? because my father worked for the government. in other words, because some asshole in congress got a 'brilliant' idea to do a sleight-of-hand to make budget numbers look better, my mother's contributions over her 40 year working career were just taken away. no one can give any sort of explanation of how that makes sense other than to say, "that's what the rule is".

that's the kind of shit that makes me wanna hurt someone. you wonder why i am so anti-government? well this travesty is a great example.

[Duemellon]

Privatization of SS withholdings is further corporatization of our lives. I understand there's debate between many different forms of investing available, I see this meaning our tax money is going straight to Merryll Lynch or JD Power.

I don't like the government mismanaging my money. I definetly don't like private businesses working with them to mismanage it.

[Sushi]

Gov't workers now pay into SS as part of the "retirement" plan - there are now 3 parts, SS, a small percentage of your salary is saved from your check, and then there is a voluntary 401K-like part you can contribute to and move your money around and invest in different portfolios. Gov't retirement ain't what it used to be, which is part of the reason gov't can't attract new hires like it used to, either. They changed the rules for gov't workers in the 80's, when Congress decided the old retirement plan was too generous and gov't workers could help bail out SS by forcing them to pay into it too. It will be a very long time before I retire, since I expect they will raise the minimum retirement age before I am 62, which is the earliest I can hope to retire at this point.
I'm a state employee, so I pay into Ohio PERS instead of SS. I have a feeling that PERS will be more solvent than SS when I decide to retire, should I retire while a public employee. That sounds great, but there are scads of problems with being a public employee. Probably the biggest is that your PERS benefits are cut if you also receive SS after retirement (thank you, Ronald Reagan). It's rare to spend your entire 40/45-year working life only in the public sector. I worked in the private sector for a while and may end up back there because there's a good chance I could get laid off in the near future (don't ask). So let's say I end up with 10 years in the public system and 25 years total paying into SS. My PERS benefits will be cut if I take SS--it's as if those 10 years of employment weren't worth as much. I think it's extremely unfair.

Another problem I'm discovering is with private retirement accounts. I tried to roll my 401k from my last job into a 403b (which is the 401k equivalent for the public sector/education). Couldn't do it. I had to roll it into a Roth IRA. Now guess what? If it turns out I have to leave this job, there's a good chance that I would again have to roll the 403b into something else and start a new 401k from scratch (so no real benefits from the miracle of compound interest). I'm finally getting the 403b to a respectable figure. There is no good reason why where you work should determine what type of private retirement account you're allowed to have. I always read pieces by financial analysts lamenting that Americans don't save enough and aren't saving enough for retirement, but the regulations governing retirement savings are contradictory and unnecessarily obtuse.

[the_birds]

I've got a good deal with my government job. We have a 457 deferred compensation plan with a mandatory 7% contribution. And we still contribute to SS. I don't know about you guys, but I can retire when I'm 55, but I'll wait probably 2 years and basically continue to receive my salary at that time until death, or slightly less if I want my wife (don't have one) to receive it until her death. If there is anything left in SS, I'll be eligible for that at 62.

Here's a good rule, you never want to have a job that doesn't contribute to SS. Its just never worth it. There has been a big deal here in Texas, because teachers were getting screwed that didn't contribute to SS.

I just had this great idea.

If (when) there is nothing left in SS for us, they should just let us deduct the entire amount we would have received from SS from our taxes. That should ease some pain. Essentially, we would get a huge tax refund every year...

[clonE]

Privatization of SS withholdings is further corporatization of our lives. I understand there's debate between many different forms of investing available, I see this meaning our tax money is going straight to Merryll Lynch or JD Power.

I don't like the government mismanaging my money. I definetly don't like private businesses working with them to mismanage it.

Exactly!

A great way to at least postpone the 'crisis' would be to finally raise the cap on SS payments. Currently anything you earn over something like 95 or 105K is SS-tax free.

To Marlowe's point, I do also agree that some of the rules need fixing. I don't know what that answer is though.

[markalot]

I've got a good deal with my government job. We have a 457 deferred compensation plan with a mandatory 7% contribution. And we still contribute to SS. I don't know about you guys, but I can retire when I'm 55

If you're only saving 7% plus SS then I would make sure to run the numbers and factor in inflation before I would be convinced retirement at 55 is wise. For one thing you'll need to assume your SS check will only be half of what you think it should be.

Government workers piss me off, no wonder we clash so much ... loser. :)

[the_birds]

Government workers piss me off, no wonder we clash so much ... loser. :)

This will piss you off even more...

The match to our 7% contribution is 225%.

I would never retire without knowing what I'm getting into. They just started this new thing last year, where you can retire for 6 months, keep receiving retirement, and start back up. Then you can get 2 checks, if you're into that kind of thing...

[the happy prole]

SSN will always be a stupid plan as long as people expect to get more out of it than they put in (plus interest). You can semi-privatize it, but when the government throws large sums of money into stocks, it distorts the market. Plus, people would rather just invest themselves.

The waste in social security comes from paying healthy upper and middle class people. Cut the program in half (at least) and restore it to its original purpose as a welfare program for the old and needy.

[Sushi]

SSN will always be a stupid plan as long as people expect to get more out of it than they put in (plus interest). You can semi-privatize it, but when the government throws large sums of money into stocks, it distorts the market. Plus, people would rather just invest themselves.

The waste in social security comes from paying healthy upper and middle class people. Cut the program in half (at least) and restore it to its original purpose as a welfare program for the old and needy.
I agree it should be restored to its original purpose of making sure old folks weren't living on cat food and tap water. At the same time, the regulations surrounding private retirement accounts (401k, 403b, etc.) need to be massively simplified so that workers can easily bring their nest egg with them from job to job (as noted in my previous post). The rules seem to have been constructed under the assumption that people will remain in one sector or industry for their entire working career and/or will only work for a handful of employers. The reality is that employment is much more fluid than it was even 20 years ago. People change jobs more frequently (and not because they're fickle) than they used to. The idea of staying with one company and working your way up throughout your entire career just isn't realistic, but the regulations seem to assume that you will. The money you save in your own account should be more portable than it is. Make it easier for individuals to save on their own, and there will be less dependency on SS.

[clonE]

Are you saying that 401k/403b monies aren't (easily) portable? I've consolidated a few accounts because of job changes and never run into problems. Simply fill out a few forms and the money moves over, no penalties. I have a portfolio that the current company account is rolled into whenever I change employers. Its worked so far...

[Sushi]

Are you saying that 401k/403b monies aren't (easily) portable? I've consolidated a few accounts because of job changes and never run into problems. Simply fill out a few forms and the money moves over, no penalties. I have a portfolio that the current company account is rolled into whenever I change employers. Its worked so far...
Going from one to the other has proven problematic (at least for me). You can't always roll a 401k over into a 403b (or vice versa). When I started this job, I had to roll the 401k over into a Roth IRA and then start a 403b from scratch. I don't see why there has to be two different types of accounts in the first place depending on where you work. I've spoken with other people who've had the same/similar problems.

[clonE]

Well, the 401k/403b difference is rather arbitrary, it depends on if your employer is for profit/not for profit. I suppose I could've run into the problems you had if I had moved my previous IRA into the new employers plan rather than starting a separate IRA.

So that's one more silly rule that needs to be fixed, as far as I know the only difference between those 2 types of acocunts is the profit status of the employer.

Now moving the k/b into a Roth is another matter, since no tax is paid on the k/b and Roth is after tax...

[Measure Up!]

I'm pretty sure the k/b's should be rolled into a Traditional IRA, not a Roth. You can have both.

[Sushi]

Well, the 401k/403b difference is rather arbitrary, it depends on if your employer is for profit/not for profit.
Exactly my point. The inability to roll one into the other makes the process of saving for retirement that much more convoluted. I can see no good reason for that rule.

[markalot]

This will piss you off even more...

The match to our 7% contribution is 225%.

I would never retire without knowing what I'm getting into. They just started this new thing last year, where you can retire for 6 months, keep receiving retirement, and start back up. Then you can get 2 checks, if you're into that kind of thing...

Well from this point on I vow to completely ignore any viewpoint you might have where the government is concerned. I want to cut your ass off and leave you scrounging for food on some street corner.

Can you feel the love? This is a prime example of why tax CUTS are so important. I want my money back.

[the_birds]

Can you feel the love? This is a prime example of why tax CUTS are so important. I want my money back.

And this is a prime example of you not knowing what you are talking about when you talk about government, nearly all of the time. The same people who want the government to run well, want it to do perform better than a private firm, pay people half the money to get it done and then want a tax cut on top of it.

If you people were any more delusionary, you would need anti-psychotic drugs!

[dannyboy]

Show me one person anywhere, that does anything, that does not think they are paid/compensated enough for what they do.

[the happy prole]

Yeah, I would think that good benefits/crappy pay arrangement would suit the average tax-payer.

You're essentially paying me very little and only rewarding me after I put in 25 years of (ostensibly) good work and retire. In private industry, I'd need less because you'd be paying me a shit-ton more right now and I'd invest it.

If I make it to retirement and live long enough after that, you have to make up what you owe me. In my case, it won't come even remotely close to breaking even. Like possibly not seven figures close. And if I suck and get fired or I bite the bullet early, you win big-time. Social Security is almost all pass-through funds. It's not going broke because of staff overhead.

I do get to work under less pressure and I get some non-financial benefits, so it's not like I'm complaining. But the problem with government is definitely not with the salaries. If anything, it's filled with too many people who don't care about money and would rather work less hard for $50k a year than work harder for $100k.