The Social Security ripoff and other internet nonsense

2014

Below is the text of an e-mail finding its way around the internet. Like so many before it, it is pure nonsense and plain garbage.

Be careful what you pass along.

First, Congress does not have free health insurance, Congress does not have outrageous pensions and yes, Congress does pay Social Security taxes so forget that babble by uniformed people.

Most important, Social Security is funded much like any pension plan. There are actuarial assumptions used to estimate the cost over time and the funding necessary. Some people will live for decades beyond the average life expectancy; others will live far less. It is the aggregate cost that matters. In addition, Social Security provides far more than a single life annuity. For example, there are survivor benefits for spouses and children, even for people who never paid a penny in taxes. There are disability benefits for younger workers. There is a COLA and more than one divorced spouse can collect monthly benefits on one workers earnings. All this is part of what your taxes must pay for.

Now, as to where the money goes, that’s very simple. Up until a few years ago incoming taxes were used to pay current benefits, the excess was used to buy special Treasury bonds that pay interest, much like when Americans buy US Savings Bonds. When the government sells any bonds it uses the proceeds to operate the government. That’s what it does when the Social Security Trust buys bonds. For those who object to this, where would you have the Trust money invested for a good return and virtual 100% security; the stock market?

Today, the benefits paid by Social Security are greater than the taxes collected and interest on the bonds is also used to pay benefits. In not so many years, incoming taxes plus interest will be insufficient and the Trust will be required to redeem the bonds. That’s when the Social Security system is in real trouble.

As for the notion you could get a better deal by keeping and investing the taxes paid … sure that’s theoretically possible … HOWEVER … what if your investments don’t earn 5%, what if there is a bear market in the years immediately before or after you retire, what if you are forced to retire early, what if you become disabled at age 40, what if you die at 50 with a family and have not had a chance to accumulate the total amount, how will you fund survivor benefits, what if you live well beyond your life expectancy, how will you cope with inflation in the years after you retire?

The fact is the taxes you paid during your working life paid for the benefits received by your parents and grandparents. One of the problems facing Social Security is the ratio of workers to retirees. The number of workers paying taxes relative to those collecting benefits is shrinking.

The problem with Social Security is that the benefits promised for the covered population are too generous in the aggregate to be funded by the current tax rates. Either future benefits must be adjusted or current workers must pay more in taxes which I’m sure comes as good news to young families trying to make ends meet.

What’s really sad is the uniformed people who make up this junk and other uninformed people pass it around.

🙈🙉🙊🙈🙉🙊🙈🙉🙊🙈🙉🙊🙈🙈🙉🙊🙈🙉🙊

Subject: Fw: Fwd: Who died before collecting Social Security?

KEEP PASSING THIS AROUND UNTIL EVERY ONE HAS HAD THE OPPORTUNITY TO READ IT…

THIS IS SURELY SOMETHING TO THINK ABOUT!!!!

THE ONLY THING WRONG WITH THE GOVERNMENT’S CALCULATION OF AVAILABLE SOCIAL SECURITY IS THAT THEY FORGOT TO FIGURE IN THE PEOPLE WHO DIED BEFORE THEY EVER COLLECTED A SOCIAL SECURITY CHECK!!!

WHERE DID THAT MONEY GO?
Remember, not only did you and I contribute to Social Security but your employer did, too.

It totaled 15% of your income before taxes.

If you averaged only $30K over your working life, that’s close to $220,500.

Read that again.

Did you see where the Government paid one single penny into it?

We are talking about the money you and your employer put in a Government bank to insure you and I that we would have a retirement check from the money we put in, not the Government.

Now they are calling the money we put in “AN ENTITLEMENT” when we reach the age to take it back.

If you calculate the future invested value of $4,500 per year (yours & your employer’s contribution) at a simple 5% interest (less than what the Government pays on the money that it borrows), after 49 years of working you’d have $892,919.98.

If you took out only 3% per year, you’d receive $26,787.60 per year and it would last better than 30 years (until you’re 95 if you retire at age 65) and that’s with no interest paid on that final amount on deposit!

If you bought an annuity and it paid 4% per year, you’d have a lifetime income of $2,976.40 per month.

A quote from a retired woman: “Another thing with me…. I have two deceased husbands who died in their 50’s, (one was 51 and the other one was 59 before one percent of their social security could be drawn.
I worked all my life and am drawing 100% on my own social security).
Their S.S. money will never have one cent drawn from what they paid into S.S. all their lives.”

THE FOLKS IN WASHINGTON HAVE PULLED OFF A BIGGER PONZI SCHEME THAN BERNIE MADOFF EVER DID.

Entitlement my foot, I paid cash for my social security insurance!
Just because they borrowed the money from it for other government spending, doesn’t make my benefits some kind of charity or handout!!

Remember Congressional benefits? — free healthcare, outrageous retirement packages, 67 paid holidays, three weeks paid vacation, unlimited paid sick days. Now that’s welfare, and they have the nerve to call my social security retirement payments entitlements?

We’re “broke” and we can’t help our own Seniors, Veterans, Orphans, or Homeless.

Yet in the last few months we have provided aid to Haiti , Chile and Turkey .
And now Pakistan ……home of Bin Laden. Literally, BILLIONS of DOLLARS!!!

And they can’t help our own citizens in New York and New Jersey?

They call Social Security and Medicare an entitlement even though most of us have been paying for it all our working lives, and now, when it’s time for us to collect, the government is running out of money.

Why did the government borrow from it in the first place? It was supposed to be in a locked box, not part of the general fund.

Sad isn’t it. 99% of people won’t have the guts to forward this.

I’m in the 1% — I just did.

Furthermore, I will forward this every time I receive it.