High earners/savers: How do you feel about social security?

[Anonymous]

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Anonymous wrote:I would like to benefit from SS in a few years. I spent many years scraping by as a journalist, always paying into the system. Spouse and I are now pretty well set financially, but the thousands each month to which we will be entitled is not just chump change--it will pay for groceries, gas, home repairs, etc. It may even allow our investments to grow untouched, which is important because at least one of us will likely need assisted living.

And you like everyone who has paid in should be entitled to what they earned for sS. It's a program everyone pays into.
Just because you manage to save for retirement doesn't change that.

You paid in to support current retirees. Future workers will pay in to support you as a retiree.

How many times does this need to be repeated.

I get that. But just because we were high earners and saved does not mean we shouldn't get our "SS support payout" for our retirement. Fact is everyone is entitled to their SS even if they were a higher earner

I agree with this. I think the math should be straightforward. You put in x/you get y without any other commentary.

Maybe there should be an option for those who wish to forgo their SS and a plan for how it could be used for the most needy. But that would be ripe for trouble and a hot mess.

The math on your federal income, property and state tax (if applicable) isn’t straightforward in terms of how it is spent. Why should it be for this?

I think what needs to be reiterated is that SS exists primarily to keep elderly people out of poverty, which is what the plan was designed for.

There is a calculator on the SS website. It should be the same for all. There are other programs that are poverty based.

Don’t even know what you are saying. SS is by far the largest income contributor for poor elderly people.

Are you saying everyone should receive the same amount of SS? Thats one idea put forth.

SS is based on an algorithm. We contribute, our employers contribute, and we receive the contributions based on math. Everyone is entitled to their SS.

For those who can’t survive on SS as calculated, there is SSI.

It’s not that easy. My Dad’s SS is about $1500/month. His housing alone is 1000. He does not qualify for SSI. He doesn’t even qualify for heating assistance etc. because he has some equity in a cheap house (not here) that would be dumb to sell because rent on a 1br apartment would cost more than his mortgage.

That’s really hard. But it also should not have been a surprise. We are repeatedly told what our benefits will be. I hope that isn’t his only source of income.

DP. Some people worked to the maximum their health and abilities allowed and saved the max they could and ended up relying on SS.. It doesn't mean they were lazy or made poor financial decisions. Divorces, health issues, disabilities and other misfortunes often derail plans.

I didn’t allude to any of those things. I didn’t even intend to convey by subtext. Sh$t happens. I said it shouldn’t have been a surprise. But the adult child of this elder said they weren’t financially literate and didn’t finish high school.

I said they didn’t attend college. They finished HS and my mom did some community college.

And I wasn’t asking anyone to feel sorry for him. It was just replying to a poster that said they just “get SSI” if they have low income. It has to be REALLY low. Like REALLY. At some point we will need to sell the house, move him to an apartment and start spending down the equity. It won’t last long.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I would like to benefit from SS in a few years. I spent many years scraping by as a journalist, always paying into the system. Spouse and I are now pretty well set financially, but the thousands each month to which we will be entitled is not just chump change--it will pay for groceries, gas, home repairs, etc. It may even allow our investments to grow untouched, which is important because at least one of us will likely need assisted living.

And you like everyone who has paid in should be entitled to what they earned for sS. It's a program everyone pays into.
Just because you manage to save for retirement doesn't change that.

You paid in to support current retirees. Future workers will pay in to support you as a retiree.

How many times does this need to be repeated.

I get that. But just because we were high earners and saved does not mean we shouldn't get our "SS support payout" for our retirement. Fact is everyone is entitled to their SS even if they were a higher earner

I agree with this. I think the math should be straightforward. You put in x/you get y without any other commentary.

Maybe there should be an option for those who wish to forgo their SS and a plan for how it could be used for the most needy. But that would be ripe for trouble and a hot mess.

The math on your federal income, property and state tax (if applicable) isn’t straightforward in terms of how it is spent. Why should it be for this?

I think what needs to be reiterated is that SS exists primarily to keep elderly people out of poverty, which is what the plan was designed for.

Then needs to be rolled into a more generalized government revenue source. The way it is currently a line-item payroll deduction is never going to sit well with people if you try to tell them it’s not for them.

It is for you. But you need to think of it for you in the same way that unemployment benefits are you. You pay into the system for those, also. And if you are fortunate, you never get that money back. But if you get laid off, it's there.

SS is even better because you will definitely get some of that money back no matter what. But you will only *need* it if you are either unlucky or dumb (and being dumb with money is a form of bad luck -- some people just have no common sense, who knows why). If you reach retirement and your SS is just a nice to have, great, you win at life. But if you reach retirement age and it's a necessity, well thank goodness it's there. Just like unemployment benefits -- you don't want to be in the position of needing them, but if you are in that position, thank goodness you can get them.

Do you get it?

But I don't personally pay into unemployment---my employer does. So it doesn't reduce my income every 2 weeks

SS also pays disability and survivorship benefits for people of any age. It also has an explicit insurance aspect to it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I would like to benefit from SS in a few years. I spent many years scraping by as a journalist, always paying into the system. Spouse and I are now pretty well set financially, but the thousands each month to which we will be entitled is not just chump change--it will pay for groceries, gas, home repairs, etc. It may even allow our investments to grow untouched, which is important because at least one of us will likely need assisted living.

And you like everyone who has paid in should be entitled to what they earned for sS. It's a program everyone pays into.
Just because you manage to save for retirement doesn't change that.

You paid in to support current retirees. Future workers will pay in to support you as a retiree.

How many times does this need to be repeated.

I get that. But just because we were high earners and saved does not mean we shouldn't get our "SS support payout" for our retirement. Fact is everyone is entitled to their SS even if they were a higher earner

I agree with this. I think the math should be straightforward. You put in x/you get y without any other commentary.

Maybe there should be an option for those who wish to forgo their SS and a plan for how it could be used for the most needy. But that would be ripe for trouble and a hot mess.

The math on your federal income, property and state tax (if applicable) isn’t straightforward in terms of how it is spent. Why should it be for this?

I think what needs to be reiterated is that SS exists primarily to keep elderly people out of poverty, which is what the plan was designed for.

There is a calculator on the SS website. It should be the same for all. There are other programs that are poverty based.

Don’t even know what you are saying. SS is by far the largest income contributor for poor elderly people.

Are you saying everyone should receive the same amount of SS? Thats one idea put forth.

SS is based on an algorithm. We contribute, our employers contribute, and we receive the contributions based on math. Everyone is entitled to their SS.

For those who can’t survive on SS as calculated, there is SSI.

It’s not that easy. My Dad’s SS is about $1500/month. His housing alone is 1000. He does not qualify for SSI. He doesn’t even qualify for heating assistance etc. because he has some equity in a cheap house (not here) that would be dumb to sell because rent on a 1br apartment would cost more than his mortgage.

That’s really hard. But it also should not have been a surprise. We are repeatedly told what our benefits will be. I hope that isn’t his only source of income.

DP. Some people worked to the maximum their health and abilities allowed and saved the max they could and ended up relying on SS.. It doesn't mean they were lazy or made poor financial decisions. Divorces, health issues, disabilities and other misfortunes often derail plans.

I didn’t allude to any of those things. I didn’t even intend to convey by subtext. Sh$t happens. I said it shouldn’t have been a surprise. But the adult child of this elder said they weren’t financially literate and didn’t finish high school.

I said they didn’t attend college. They finished HS and my mom did some community college.

And I wasn’t asking anyone to feel sorry for him. It was just replying to a poster that said they just “get SSI” if they have low income. It has to be REALLY low. Like REALLY. At some point we will need to sell the house, move him to an apartment and start spending down the equity. It won’t last long.

You made a good point. And even if they didn’t finish high school (instead of college), no shade either way. People have their own paths.

[Anonymous]

Anonymous wrote:We should have enough without. I don't understand why they have a wage cap. Just take it from all wages and that will solve the insolvency problems pretty quick.

I wish they would just tax all earnings instead of having a cap there - that would also solve the problem!

[Anonymous]

Anonymous wrote:

Anonymous wrote:We should have enough without. I don't understand why they have a wage cap. Just take it from all wages and that will solve the insolvency problems pretty quick.

I wish they would just tax all earnings instead of having a cap there - that would also solve the problem!

Will it though (serious question)?

The ultra high net worth and above folks derive far more from investments and capital gains that aren’t subject to SS taxes.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We should have enough without. I don't understand why they have a wage cap. Just take it from all wages and that will solve the insolvency problems pretty quick.

I wish they would just tax all earnings instead of having a cap there - that would also solve the problem!

Will it though (serious question)?

The ultra high net worth and above folks derive far more from investments and capital gains that aren’t subject to SS taxes.

So charge cap gains and carried interest tax the same as earned income. Why should they get a discount? Done.

[Anonymous]

Make the program optional if you make over a certain amount

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We should have enough without. I don't understand why they have a wage cap. Just take it from all wages and that will solve the insolvency problems pretty quick.

I wish they would just tax all earnings instead of having a cap there - that would also solve the problem!

Will it though (serious question)?

The ultra high net worth and above folks derive far more from investments and capital gains that aren’t subject to SS taxes.

So charge cap gains and carried interest tax the same as earned income. Why should they get a discount? Done.

That’s a complete overhaul of the tax code. Increasing on W2 earnings is a far easier thing to pass and somewhat realistic.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I would like to benefit from SS in a few years. I spent many years scraping by as a journalist, always paying into the system. Spouse and I are now pretty well set financially, but the thousands each month to which we will be entitled is not just chump change--it will pay for groceries, gas, home repairs, etc. It may even allow our investments to grow untouched, which is important because at least one of us will likely need assisted living.

And you like everyone who has paid in should be entitled to what they earned for sS. It's a program everyone pays into.
Just because you manage to save for retirement doesn't change that.

You paid in to support current retirees. Future workers will pay in to support you as a retiree.

How many times does this need to be repeated.

I get that. But just because we were high earners and saved does not mean we shouldn't get our "SS support payout" for our retirement. Fact is everyone is entitled to their SS even if they were a higher earner

I agree with this. I think the math should be straightforward. You put in x/you get y without any other commentary.

Maybe there should be an option for those who wish to forgo their SS and a plan for how it could be used for the most needy. But that would be ripe for trouble and a hot mess.

The math on your federal income, property and state tax (if applicable) isn’t straightforward in terms of how it is spent. Why should it be for this?

I think what needs to be reiterated is that SS exists primarily to keep elderly people out of poverty, which is what the plan was designed for.

There is a calculator on the SS website. It should be the same for all. There are other programs that are poverty based.

Don’t even know what you are saying. SS is by far the largest income contributor for poor elderly people.

Are you saying everyone should receive the same amount of SS? Thats one idea put forth.

SS is based on an algorithm. We contribute, our employers contribute, and we receive the contributions based on math. Everyone is entitled to their SS.

For those who can’t survive on SS as calculated, there is SSI.

It’s not that easy. My Dad’s SS is about $1500/month. His housing alone is 1000. He does not qualify for SSI. He doesn’t even qualify for heating assistance etc. because he has some equity in a cheap house (not here) that would be dumb to sell because rent on a 1br apartment would cost more than his mortgage.

But that is why you shouldn't retire until you have a place to live. Stop taking loans against your home to fund other things. Work your ass off to pay off the house before you hit 60.

But, also, if he's been low income all his life then retirement is bare bones. There shouldn't be some expectation of living a better life in retirement.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I would like to benefit from SS in a few years. I spent many years scraping by as a journalist, always paying into the system. Spouse and I are now pretty well set financially, but the thousands each month to which we will be entitled is not just chump change--it will pay for groceries, gas, home repairs, etc. It may even allow our investments to grow untouched, which is important because at least one of us will likely need assisted living.

And you like everyone who has paid in should be entitled to what they earned for sS. It's a program everyone pays into.
Just because you manage to save for retirement doesn't change that.

You paid in to support current retirees. Future workers will pay in to support you as a retiree.

How many times does this need to be repeated.

I get that. But just because we were high earners and saved does not mean we shouldn't get our "SS support payout" for our retirement. Fact is everyone is entitled to their SS even if they were a higher earner

I agree with this. I think the math should be straightforward. You put in x/you get y without any other commentary.

Maybe there should be an option for those who wish to forgo their SS and a plan for how it could be used for the most needy. But that would be ripe for trouble and a hot mess.

The math on your federal income, property and state tax (if applicable) isn’t straightforward in terms of how it is spent. Why should it be for this?

I think what needs to be reiterated is that SS exists primarily to keep elderly people out of poverty, which is what the plan was designed for.

There is a calculator on the SS website. It should be the same for all. There are other programs that are poverty based.

Don’t even know what you are saying. SS is by far the largest income contributor for poor elderly people.

Are you saying everyone should receive the same amount of SS? Thats one idea put forth.

SS is based on an algorithm. We contribute, our employers contribute, and we receive the contributions based on math. Everyone is entitled to their SS.

For those who can’t survive on SS as calculated, there is SSI.

It’s not that easy. My Dad’s SS is about $1500/month. His housing alone is 1000. He does not qualify for SSI. He doesn’t even qualify for heating assistance etc. because he has some equity in a cheap house (not here) that would be dumb to sell because rent on a 1br apartment would cost more than his mortgage.

That’s really hard. But it also should not have been a surprise. We are repeatedly told what our benefits will be. I hope that isn’t his only source of income.

DP. Some people worked to the maximum their health and abilities allowed and saved the max they could and ended up relying on SS.. It doesn't mean they were lazy or made poor financial decisions. Divorces, health issues, disabilities and other misfortunes often derail plans.

But plenty end up their thru poor choices. At some point, it is not the responsibility of everyone else to fix their poor choices. Like how do you "own a home for 30+ years" and not have the mortgage paid off when you retire? It's a bad financial choice to not work towards paying it off and to borrow against it.
If you choose not to do that, well then retirement/final years might not be that nice for living....but you had a choice

[Anonymous]

Just fix it. Pay on all income. Continue to pay out larger percentage for lower income earners and have a means tested cap that is inflation adjusted for those with $500K or more annual income from other sources outside social security.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We should have enough without. I don't understand why they have a wage cap. Just take it from all wages and that will solve the insolvency problems pretty quick.

I wish they would just tax all earnings instead of having a cap there - that would also solve the problem!

Will it though (serious question)?

The ultra high net worth and above folks derive far more from investments and capital gains that aren’t subject to SS taxes.

So charge cap gains and carried interest tax the same as earned income. Why should they get a discount? Done.

That’s a complete overhaul of the tax code. Increasing on W2 earnings is a far easier thing to pass and somewhat realistic.

Collecting a tax for a benefit you have no plans to pay out in full is also defacto overhauling the tax code. The medicare tax does not even have a cap and in fact imposes a surgecharge for couples making over $250k despite the fact that those same people will have to pay higher premiums to access medicare in retirement due to means testing. It's utter BS.

[Anonymous]

Anonymous wrote:Just fix it. Pay on all income. Continue to pay out larger percentage for lower income earners and have a means tested cap that is inflation adjusted for those with $500K or more annual income from other sources outside social security.

Something like this, except the means tested cap idea seems overly complicated. You can just give those people their money.

So many people don't even know there is a point where wages aren't subject to social security and if you eliminate that it solves like 3/4 of the funding deficit.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Just fix it. Pay on all income. Continue to pay out larger percentage for lower income earners and have a means tested cap that is inflation adjusted for those with $500K or more annual income from other sources outside social security.

Something like this, except the means tested cap idea seems overly complicated. You can just give those people their money.

So many people don't even know there is a point where wages aren't subject to social security and if you eliminate that it solves like 3/4 of the funding deficit.

The current max payout for retiring at 70 is about $62k per year. The social security tax is 12.4% (half paid by employer.) If you remove the cap, the government will collect as much money on someone making $500k in today's dollars as they will pay out in 30+ year future dollars.

You can't remove the cap on the tax while maintaining the cap on the future payout. As it is, the benefit is taxed at a much higher rate for people collecting the max or near the max, especially if married.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I would like to benefit from SS in a few years. I spent many years scraping by as a journalist, always paying into the system. Spouse and I are now pretty well set financially, but the thousands each month to which we will be entitled is not just chump change--it will pay for groceries, gas, home repairs, etc. It may even allow our investments to grow untouched, which is important because at least one of us will likely need assisted living.

And you like everyone who has paid in should be entitled to what they earned for sS. It's a program everyone pays into.
Just because you manage to save for retirement doesn't change that.

You paid in to support current retirees. Future workers will pay in to support you as a retiree.

How many times does this need to be repeated.

I get that. But just because we were high earners and saved does not mean we shouldn't get our "SS support payout" for our retirement. Fact is everyone is entitled to their SS even if they were a higher earner

I agree with this. I think the math should be straightforward. You put in x/you get y without any other commentary.

Maybe there should be an option for those who wish to forgo their SS and a plan for how it could be used for the most needy. But that would be ripe for trouble and a hot mess.

The math on your federal income, property and state tax (if applicable) isn’t straightforward in terms of how it is spent. Why should it be for this?

I think what needs to be reiterated is that SS exists primarily to keep elderly people out of poverty, which is what the plan was designed for.

There is a calculator on the SS website. It should be the same for all. There are other programs that are poverty based.

Don’t even know what you are saying. SS is by far the largest income contributor for poor elderly people.

Are you saying everyone should receive the same amount of SS? Thats one idea put forth.

SS is based on an algorithm. We contribute, our employers contribute, and we receive the contributions based on math. Everyone is entitled to their SS.

For those who can’t survive on SS as calculated, there is SSI.

It’s not that easy. My Dad’s SS is about $1500/month. His housing alone is 1000. He does not qualify for SSI. He doesn’t even qualify for heating assistance etc. because he has some equity in a cheap house (not here) that would be dumb to sell because rent on a 1br apartment would cost more than his mortgage.

That’s really hard. But it also should not have been a surprise. We are repeatedly told what our benefits will be. I hope that isn’t his only source of income.

DP. Some people worked to the maximum their health and abilities allowed and saved the max they could and ended up relying on SS.. It doesn't mean they were lazy or made poor financial decisions. Divorces, health issues, disabilities and other misfortunes often derail plans.

But plenty end up their thru poor choices. At some point, it is not the responsibility of everyone else to fix their poor choices. Like how do you "own a home for 30+ years" and not have the mortgage paid off when you retire? It's a bad financial choice to not work towards paying it off and to borrow against it.
If you choose not to do that, well then retirement/final years might not be that nice for living....but you had a choice

But all welfare payments fix “poor choices”. Why would anyone single out SS?

I mean, I have zero tolerance for giving farmer bailouts when they vote for someone who tells them he will destroy their business…and then he does…and then they cry for a bailout.